Can’t give flat on time, pay interest on amount paid: MahaRERA to builder

In a pathbreaking order the MahaRERA despite pendency of proceedings before the National Company Law Tribunal NCLT directed award of interest on delayed possession of a flat to its buyer in a project on MarolMaroshi Road AndherildquoSamual Andrews the complainant had paid 100 per cent for flat No 606 on the 6th floor of B Wing 725 sq ft mdash carpet along with a car park space in Empress Height now known as The Height It was originally being constructed by the KSL amp Industries Ltd on land belonging to the BEST Undertaking As per the Articles of Agreement dated January 20 2016 the possession of the flat was to be given to the complainant on or before December 31 2017 Since possession got delayed the complaint was filed before MahaRERA seeking interest on delayed possessionrdquo said Advocate Godfrey Pimenta who represented the complainantPimenta added that they later learnt that KSL had entered an agreement on June 23 2016 with Dhruvi Properties Pvt Ltd to complete the project ldquoSubsequently the original agreement was modified Dhruvi claimed that it is merely a contractor and also stated that proceedings were pending against KSL before the NCLT Ahmedabad Bench Thereafter the complainant was granted liberty by the chairperson MahaRERA on April 27 2021 to implead with the Interim Insolvency Resolution Professional appointed by NCLT Ahmedabad Benchrdquo Pimenta saidldquoDuring the hearing it was learnt that Dhruvi which has registered the project with MahaRERA had no rights to develop the property as revealed by a RTI reply The Interim Insolvency Resolution Professional IIRP had stated that as a resolution proceeding is on all other proceedings shall be barred and therefore we made him too a party to the MahaRERA case Since the liability of the developer has been crystallised the complainant has been advised to file his claim for interest on delayed possession before NCLTrdquo said PimentaAlso read Experts want free legal aid for litigants approaching MahaRERAThe other sideIn their argument the respondents stated ldquoThe present complaint is not maintainable as NCLT proceedings have been initiated against the Respondent No1 KSL amp Industries Limited and an Interim IRP has been appointed by the NCLT Ahmedabad by order dated September 6 2019 The agreement was between the complainant and Respondent No1 and there is no contract or agreement with the Respondent No2 Ms Dhruvi Properties Pvt Ltd The complainant can claim right if any only against Respondent No1 which is a subject matter of NCLT proceedingsrdquoMahaRERA observationAjoy Mehta MahaRERA chairman before passing his order on September 14 stated ldquoThe agreement was between the Respondent No1 and the complainant prior to the RERA coming into force in 2017 The project when registered with MahaRERA had the proposed completion date mentioned on its webpage as December 31 2019 In complaints where the agreement for sale AFS has been executed in ongoing projects before the commencement of RERA the date of possession as mentioned in the AFS should be sacrosanct and not as declared by the promoter on MahaRERA webpage In this regard note that the purpose of the said Act is to implement such agreements for sale in ongoing projects and not to rewrite those agreements and change the date of possession Thus there is a delay in handover of possession by the Respondent No1 and a clear violation of Section 18 of the Act Hence the liability to pay interest to the complainant for the delay caused on the amounts paid by him till the actual handover of possession with occupation certificate arisesrdquoldquoHowever since an IIRP has been appointed in the NCLT proceedings at Ahmedabad against the Respondent No1 it will definitely have an effect in the present case in terms of execution of the liability towards the complainant Also the IIRP has stated that as a resolution proceeding is on all other proceedings are barred But this Authority has only adjudicated the issue of entitlement of claim for interest for delay in handover of possession at this juncturerdquo Mehta observedAnother litigant saysIn February 2010 Thambi Johnson had also booked a flat of 625 sq ft carpet area in Empress Heights in his wifersquos name ldquoWithout intimation the builder changed the total floor plan layout and my allotted flat number at least 4 timesrdquo said Johnson He also said without informing them the initial developer transferred the development rights to Dhruvi Properties ldquoWe have paid them a total of Rs 3445139 till now which they acknowledgedrdquo said ThambiHe approached MahaRERA in August 2019 Maha RERA in its order dated February 20 2020 directed the builder to allot the flat to Johnson again ldquoIn response the builder vide its letter dated March 19 2020 stated lsquoAll the flats were sold out and only investors flats were availablersquo I have neither got a refund nor my flat The builder is not complying with the Maha RERA directiverdquo said Johnson