On 13th December 2018, in a suit before the Haryana Real Estate Regulatory Authority (HRERA), Panchkula, seeking compensation for delayed possession of the property, The Adjudicating Officer, Anil Kumar Panwar,ruled in favour of the Complainant, thus,awarding him interest on the sales consideration at the rate prescribed in Rule 15 of The Haryana Real Estate (Regulation and Development) Rules, 2017.
In a suit filed before the HRERA, the authority warded compensation to the complainants and interest on the sales consideration at the rate prescribed in Rule 15 of The Haryana Real Estate (Regulation and Development) Rules, 2017.the authority held that the Complainant was entitled to compensation for the period starting from the date on which he had paid the sale consideration to the date on which he was delivered valid possession
Facts of the Case
The undisputed facts of the case are as follows. The Complainant had purchased commercial plot- SCO No. 88 from the respondent in a public auction, for a sum of Rs.1,02,50,000/-, which was paid by him on 29th April 2015. He was delivered possession of the property and he started construction work. However, the construction work had to cease when the owner of the adjoining property produced an order of Civil Court where by the respondent and allottees were ordered to maintain status quo regarding the allotted sites, as they were encroaching upon the owner’s property.
This bought the attention of the officers of the respondent to the mistake they had committed in demarcating the plots put on auction and they decided to revise the zoning plan of the area and re-demarcate the plots put on auction. The Complainant was not delivered possession of the plot on the basis of the revised Zoning plan and therefore he filed a complaint before the Real Estate Regulatory Authority (RERA). During the pendency of the suit, on 21st June 2018, the respondent delivered possession of the purchased land to the Complainant.
The authority, while dismissing the complaint as infructuous, found that the Complainant could not reap benefits from the purchased property due to the error committed in demarcation by the respondent, and thus, gave the complainant liberty to file a complaint before the Adjudicating Officer for claiming compensation as he may be entitled as per law. For these reasons, the Complainant moved to the court in the present complaint seeking compensation for the period in which he could not raise construction on the purchased plot.
Issue Examined by the Court
While admitting that the Complainant could not reap the fruits of the purchased property because of the defect on the part of the respondent in proper demarcation and delivery of possession of the purchased plot, the counsel for the respondent argued that the Complainant was not entitled to compensation as there was no intentional delay by the respondent in delivery of possession. The delivery of the plot and revision of zoning plan took a considerable time merely because the process involved permissions of various authorities and files were moving from one department to the other.
The authority rejected this explanation of the respondent and ruled that the respondent could not seek to avoid liability to pay compensation on these grounds. It was held that the department had a pious duty to take necessary care in carving out plots before putting them on public auction. In case of any negligence in demarcation of plots, causing the allottees to suffer loss, the allottees were entitled to be compensated for the period they remained deprived of the money paid to the department and also of the enjoyment of the property purchased by him.
Legal Provisions
Section 12, The Real Estate (Regulation and Development) Act, 2016
- Obligations of promoter regarding veracity of the advertisement or prospectus
Where any person makes an advance or a deposit on the basis of the information contained in the notice advertisement or prospectus, or on the basis of any model apartment, plot or building, as the case may be, and sustains any loss or damage by reason of any incorrect, false statement included therein, he shall be compensated by the promoter in the manner as provided under this Act:
Provided that if the person affected by such incorrect, false statement contained in the notice, advertisement or prospectus, or the model apartment, plot or building, as the case may be, intends to withdraw from the proposed project, he shall be returned his entire investment along with interest at such rate as may be prescribed and the compensation in the manner provided under this Act.
Rule 15, The Haryana Real Estate (Regulation and Development) Rules, 2017
- Interest payable by promoter and Allottee
An allottee shall be compensated by the promoter for loss or damage sustained due to incorrect or false statement in the notice, advertisement, prospectus or brochure in the terms of section 12. In case, allottee wishes to withdraw from the project due to discontinuance of promoter’s business as developers on account of suspension or revocation of the registration or any other reason(s) in terms of clause (b) sub-section (I) of Section 18 or the promoter fails to give possession of the apartment/ plot in accordance with terms and conditions of agreement for sale in terms of sub-section (4) of section 19. The promoter shall return the entire amount with interest as well 13 as the compensation payable. The rate of interest payable by the promoter to the allottee or by the allottee to the promoter, as the case may be, shall be the State Bank of India highest marginal cost of lending rate plus two percent. In case, the allottee fails to pay to the promoter as per agreed terms and conditions, then in such case, the allottee shall also be liable to pay in terms of sub-section (7) of section 19:
Provided that in case the State Bank of India marginal cost of lending rate (MCLR) is not in use, it shall be replaced by such benchmark lending rates which the State Bank of India may fix from time to time for lending to the general public.
Order Passed
In consideration of the aforementioned, the authority held that the Complainant was entitled to compensation for the period starting from the date on which he had paid the sale consideration to the date on which he was delivered valid possession, i.e. from 29th April 2015 to 21st July 2018. He was thus, awarded interest at the rate prescribed in Rule 15 of HRERA Rules, 2017, on the amount of sale consideration paid to the respondent, i.e. Rs. 1,02,50,000/-.
Consequently, the court ordered the respondent to pay compensation to the Complainant on the aforementioned terms, within 45 days from the date of uploading of the order.
In a suit filed before the HRERA, the authority warded compensation to the complainants and interest on the sales considerationat the rate prescribed in Rule 15 ofThe Haryana Real Estate (Regulation and Development) Rules, 2017.the authority held that the Complainant was entitled to compensation for the period starting from the date on which he had paid the sale consideration to the date on which he was delivered valid possession.
For case specific advice on real estate matters related to delayed possession, delay compensation, one may contact top/best expert RERA Panchkula (Real Estate Regulatory Authority) Lawyers in Chandigarh Panchkula Mohali Zirakpur Derabassi Kharar Mullanpur Baltana.
This post is written by Soumya Nayyar.
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