BEFORE THE MAHARASHTRA REAL ESTATE REGULATORY AUTHORITY, MUMBAI Virtual Hearing held through video conference as per MahaRERA Circular No.: 27/2020 COMPLAINT NO. CC006000000209592 BHARATI SARANGI …COMPLAINANT VS KARRM INFRASTRUCTURE PRIVATE LIMITED …RESPONDENT MAHARERA PROJECT REGISTRATION NO. P51700008284 Order September 22, 2022 (Date of hearing -21.03.2022 matter was reserved for order) Coram: Shri. Ajoy Mehta, Chairperson, MahaRERA Advocate Pankaj Bajaj for the Complainant Advocate T. R. Tipre for the Respondent 1. The Complainant is home buyers and Allottees within the meaning of Section 2 (d) of the Real Estate (Regulation and Development) Act, 2016 (hereinafter referred to as the “said Act”) of Real Estate Regulatory Authority (hereinafter referred to as the “RERA”) and the Respondent is the Promoter/Developer within the meaning of Section 2 (zk) of the said Act. The Respondent is registered as the Promoter of the Project namely “KARRM GARDENS - 1” under section 5 of the said Act bearing MAHARERA Project Registration No. P51700008284 (hereinafter referred to as the “said Project”). On the MahaRERA Project registration webpage the proposed completion date of the said Project is mentioned as 31.12.2014, revised proposed completion date is mentioned as 31.05.2019 and the extended date of completion is 30.11.2020. The said Project is lapsed project. 2. The Complainant is seeking the following reliefs: Page 1 of 6 QUOTE 1. Refund of Rs 79,64,880 along with SBI's MCLR + 2 % Interest Rate from Respondent Promoter from the Date of Proposed Possession as mentioned in the Sale Agreement until realization of this Refund of Rs 79,64,880 under Sec 18 (1) (a) & (b) of RERA Act, 2016 by Complainant. 2. Compensation for Mental Harrasment and as an Exemplary Punishment to Respondent Promoter, as the MAHA RERA Authority may deem fit. 3. Litigation Expenses which will be incurred to get the Decree in favor of Complainant and to get it executed before MAHA RERA & its appellate forums. UNQUOTE 3. The complaint was heard on 21.03.2022 wherein the following roznama was passed by this Authority: “It is noted with concern that Advocate for the Complainant was not prepared. He then sought time to argue the matter on a different date. The Complainant to file and serve written submissions together with statement of account and reliefs sought by the 31.03.2022. The Respondent to file and serve their written submissions by the 07.04.2022, subsequent to which the matter will be Reserved for orders.” 4. The brief facts in the complaints are as follows: a. Vide a registered agreement for sale dated 13.08.2013 the Complainants purchased a flat No. 406 on the 4th floor in Building No. 2 of the said Project for a total consideration of Rs. 34,44,084/- (hereinafter referred to as “said agreement” and “said apartment” respectively). Date of possession mentioned in said agreement is 31.12.2014 (ref: mentioned by the Complainant in the complaint, no Agreement copy uploaded). b. The Complainant seeks refund of amounts along with interest and compensation. 5. The Advocate for Respondent was present on the hearing dated 21.03.2022. However, the Respondent has failed to filed any written submission. Further, The Advocate for Respondent during the hearing dated 21.03.2022 had submitted that they are now in the process of seeking the extension of the said Project as the said Project had lapsed. But till date the Respondent has failed to seek any such extension and the said Project still remains as lapsed. Page 2 of 6 6. From the facts and the submissions, the only issue that needs to be considered is Whether the Complainant is allowed to exit from the said Project and claim refund of the amounts paid together with interest and compensation, if any under section 18 of the Act? 7. In order to answer the issue hereinabove, it is pertinent to examine “possession” as contemplated under section 18 of the said Act: “18. (1) If the promoter fails to complete or is unable to give possession of an apartment, plot or building,— (a) in accordance with the terms of the agreement for sale or, as the case may be, duly completed by the date specified therein; or (b) due to discontinuance of his business as a developer on account of suspension or revocation of the registration under this Act or for any other reason, he shall be liable on demand to the allottees, in case the allottee wishes to withdraw from the project, without prejudice to any other remedy available, to return the amount received by him in respect of that apartment, plot, building, as the case may be, with interest at such rate as may be prescribed in this behalf including compensation in the manner as provided under this Act: Provided that where an allottee does not intend to withdraw from the project, he shall be paid, by the promoter, interest for every month of delay, till the handing over of the possession, at such rate as may be prescribed.” From the plain reading of section 18 it is very clear that if the Promoter (Respondent herein) fails to handover possession as per the terms of the agreement for sale by the specified date therein, the Allotees (the Complainant herein) have a choice either to withdraw from the said Project or stay with the Project. Further, in case the Allottees (the Complainant herein) chooses to withdraw from the said Project, they are entitled to claim interest including compensation from the Promoter (Respondent herein) at such rate as may be prescribed. 8. Thus, it is admittedly clear that there is a delay on part of the Respondent with regard to the handover of possession with Occupation Certificate (OC). In this regard it is also important to note that the Complainant had executed agreement for sale before the commencement of RERA. It is also pertinent to note that Complainant have not uploaded the agreement for sale thus, the specific date of possession for the complaint shall be the proposed completion date mentioned on the MahaRERA project registration webpage i.e. 31.12.2014. Page 3 of 6 9. Further it is also pertinent that MahaRERA came into effect on 01.05.2017 on this date the pre-RERA agreement with its covenants binding upon the Complainant and the Respondent were in existence. With these binding preRERA agreement, the Parties have now stepped into the era of RERA. At this juncture none of the Parties can use RERA as an instrument to open up and rewrite contracts which have come into effect pre-RERA. This Authority cannot re-write a contract which was executed before the commencement of MahaRERA and that which was entered into between the Parties with complete awareness. The said Act does not envisage that the contracts / agreements entered into by the Parties prior to the commencement of MahaRERA shall be deemed to have been re-written as per the said Act nor does the said Act envisage fresh contracts be drawn up. 10. Thus, to sum it up the complaint where the agreements for sale were signed prior to advent of RERA the date of possession specified in the agreement for sale shall be taken to be the date of possession on which the premises were promised to be delivered by the Respondent. However, the complainant has not uploaded the agreements for sale, the date of possession shall be that which is mentioned on the MahaRERA project registration webpage. In view thereof, the interest for delay in handover of possession shall be applicable from 01.01.2015. It is also important to note that the interest cannot be made applicable from the date of payment/ deposit because the Allottees who decide to stay in the said Project despite the delay are entitled to interest for the delay that takes place from the specific date of possession mentioned in the agreements for sale. Further it is also pertinent to note that the Authority cannot make withdrawal more lucrative than continuing with the said Project and thereby jeopardise or further delay the project completion for those who have chosen to stay in the said Project. 11. It is observed thus, that the Respondent has failed to handover possession of the apartments on the agreed date and has violated the provision of section 18 mentioned hereinabove consequently the Complainant a have clearly chosen to exit the said Page 4 of 6 Project and seek refund of the amount paid along with interest and compensation if any. Thus, the complaint is allowed and the Complainants are allowed to withdraw from the said Project and the Respondent is directed to refund the amounts paid by them along with interest from 01.01.2015 and the issue at para No.6 hereinabove is answered in affirmative. 12. Further the provisions of section 18 are clear that if the Respondent fails to handover possession by the specified date as mentioned in the agreements for sale, the Respondent shall be liable to pay interest to the Complainant and this provision does not provide for any waiver or disclaimer or exception or force majeure event happening. It is an absolute provision. Reasons for delay as stated by the Respondent can be grounds for consideration with regard to seeking extension of the completion date under MahaRERA for the said Project and not otherwise. However, it is noted that the said Project is lapsed since 30.11.2020 and the Respondent has not sought for extension of the said Project till date and in view thereof the Respondent is liable to pay a penalty under section 61 of the said Act. 13. Further, it is also observed that the Complainant herein have sought housing loans from LIC under the subvention scheme for funding the payments of the said apartment. In this regard it is observed that the Complainant shall carry out the responsibility of closing the aforesaid housing/ mortgage loans and obtain the necessary NOCs from the banks/financial institutions for releasing their said apartment from the mortgage / lien so created and free the apartment from any encumbrances. 14. Further, with regard to the payment of interest to the Complainant herein, it is observed that the Respondent Promoter is not entitled to claim the benefit of “moratorium period” as mentioned in the Notifications / Orders Nos. 13, 14 and 21 dated 02.04.2020, 18.05.2020 and 06.08.2021 respectively issued by the MahaRERA as the date of possession was much before the advent of RERA i.e. 31.12.2014. Page 5 of 6 15. Further, with regard to claiming compensation on account of mental stress and agony, it is not clear as to how the same is sought to be quantified as no documents supporting the same are filed/ uploaded/ placed on record by the Complainant herein thus, the plea for seeking compensation is rejected. FINAL ORDER In view of the observations hereinabove, the following order is passed: A. Thus, the complaint is allowed and the Complainant is entitled to withdraw from the said Project and seek refund of the amounts paid by them toward the consideration of the apartment purchased in the said Project. B. The interest on refund amounts shall be applicable from 01.01.2015 at the rate as prescribed under Rule 18 of the Maharashtra Real Estate (Regulation and Development) (Registration of Real Estate Projects, Registration of Real Estate Agents, Rate of Interest and Disclosures on Website) Rules 2017 till the amounts are realized. C. The Respondent is directed to cancel the agreement for sale of the Complainant herein upon the refund of the amounts with interest to the Complainant. D. Needless to say, that the Complainant have taken loans and have created lien on apartment shall be duty bound to settle the dues of the banks / financial institution first and release the said apartment from the mortgage / lien so that it is free from any encumbrances. E. The Respondent is directed to pay a penalty of Rs.50,000/- for not seeking extension of the said Project till date and for violating the provisions of the said Act. F. No order as to cost. AJOY Digitally signed by AJOY MEHTA MEHTA 14:52:09 +05'30' Date: 2022.09.22 (Ajoy Mehta) Chairperson, MahaRERA Page 6 of 6