Haryana Real Estate Regulatory Authority (power) Bench, consisting of Sanjeev Kumar Arora (Member)), has directed the builder to refund the amount paid by the complainant for a unit in a commercial real estate project named Landmark Cyber Park, as the builder failed to pay the monthly refund of Rs. 46,000
Background facts
The complainant booked a 230 sq ft unit with Builders (Respondent) business plan, Landmark Cyber Park46,00,000 by entering into a Memorandum of Understanding with the Builder on 21.02.2012, situated at Sector 67, Gurgaon, paying a total sum of Rs.46,00,000 at one time.
As per Clause 4 of the Memorandum of Understanding (MOU), the builder promised to pay the complainant Rs. 46,000 as assured return/rent on a monthly basis, quarterly, till the date of possession or for three years, whichever is earlier.
However, the builder failed to pay any assured refund since November 2013. Aggrieved by the conduct of the builder, the complainant lodged a complaint with the authority for refund of the amount paid with interest.
Builder Disputes
The builder claimed that the complainant paid Rs. 46,00,000 towards the sale price as per the terms of the MOU. However, apart from this amount, the complainant was also required to make other payments such as External Development Charges (EDC)/Internal Development Charge (IDC), Interest Free Maintenance Security Charges (IFMS), and Advance Maintenance Charges.
The builder further claimed that, as per the MOU, it was specifically agreed that the builder would pay the complainant Rs. 46,000 per month as an assured return, payable quarterly till the date of possession or for three years, whichever comes first. However, no specific time limit was given in the MoU for handing over possession of the unit, as the unit was sold on an assured return plan.
Observed and directed by authority
Since there was no builder-buyer agreement (agreement for sale) between the complainant and the builder, the authority referred the case to the Supreme Court. Pioneer Urban Land & Infrastructure Ltd. vs. Govindan Raghavan Deciding the date of possession of the unit.
In this case, the court ruled that buyers should not wait indefinitely for possession and are entitled to a refund with compensation if there is no fixed delivery period. The Supreme Court held that if there is no sale agreement between the parties, three years is a reasonable time to complete.
Therefore, referring to PIONEER URBAN LAND AND INFRASTRUCTURE LIMITEDthe Authority determined that the date of possession would be three years from the signing of the MoU, i.e. 21.02.2015.
Further, the Authority observed that the unit was allotted vide an MOU dated 21.02.2012, with date of possession fixed as 21.02.2015. The possession certificate was received on 26.12.2018, and the complainants handed over the unit by filing a complaint on 18.02.2022.
Authority cited. Rule 11(5) of Haryana Real Estate Regulatory Authority Gurugram (Forfeiture of Earnings by Builder) Regulations 2018which says:
“Prior to the Real Estate (Regulations and Development) Act, 2016, the scenario was different. Frauds were practiced without fear as there was no law for it. Hon'ble National Consumer Disputes Redressal Commission and Hon'ble Supreme Court of India, the Authority is of the view that the amount of confiscation of the statement shall not exceed 10% of the consideration amount of the real estate i.e. apartment/plot/building, as the case may be, in all cases where unilaterally by the builder Cancellation of the Flat/Unit/Plot or the Purchaser purporting to withdraw from the Agreement shall be null and void and shall not be binding on the Purchaser.
So the authority directed the builder to refund the amount paid. 46,00,000 after deducting 10% of the sale consideration of Rs. 46,00,000 as a statement, with an interest rate of 10.85% p.a.
Case – Reena Devi and another vs. M/s Landmark Apartments Pvt
Reference – Complaint No. 465 of 2022