NO AGREEMENT FOR SALE, NO REFUND, RULES MAHARERA, MUMBAI

 

NO AGREEMENT FOR SALE, NO REFUND, RULES MAHARERA

 

Brief Facts

A group of 15 persons who had booked flats in JVPD Properties Pvt. Ltd. (commonly known as Bhagtani group) Serenity project in Powai  filed a complaint with the MahaRERA, Mumbai  claiming refund of the amounts paid by them to the builder together with interest.

The builder  had  only given them allotment letters that contained a clause saying their investments will be refunded with a15 per cent interest if project approvals do not come forth. Similar allotment letters were issued to buyers in Riyo (Mira Road), Sapphire (Dahisar) and Savannah (Kanjurmarg) housing projects. There was no Agreement for Sale.

 

Decision

By his order dated December 29, 2017, Bhalchandra Kapadnis,  the Adjudicating officer and Member, MahaRERA, Mumbai  held that if the builder had not entered into an Agreement for Sale, the purchasers could not approach RERA.

He held that Section 18 clearly stipulates that a promoter is liable to pay interest or compensation if he fails to complete or is unable to give possession of an apartment in accordance with the terms of agreement for sale.

“The Section 18 clearly indicates that there must be an agreement for sale for invoking Section 18. The allottee gets a refund only when the promoter fails to complete the apartment in accordance with the terms of agreement for sale or he is unable to give possession on the date specified in the agreement. Therefore, in the absence of any agreement for sale, section 18 has no role to play. It is necessary to bear in mind that issuance of allotment letter is the first stage and execution of the agreement for sale is the subsequent stage,” said Kapadnis in his ruling.

The affected persons are going to file appeal.
I suggest they approach the Consumer Forums.

MOFA – No conveyance for 21 years – Director of Satellite Developers sentenced to  two years jail

 

MOFA – No conveyance for 21 years – Director of Satellite Developers sentenced to  two years jail


Builders violate the provisions of the Maharashtra Ownership of Flats Act (MOFA) with impunity. But MOFA contains harsh punishments which aggrieved purchasers of flats do not resort to for fear of retaliation or ignorance or both.

The following case is a good example how effective MOFA can be.

 


Facts

 

Ravindra Hingwala, one of the flat owners of a building in Ghatkopar, Mumbai, moved the Magistrate’s Court in 2006 against Kiran Amin, Director of Satellite Developers Pvt. Ltd.  (builder) for not completing the conveyance.  The completion certificate of the building was obtained in 1989. The mandatory housing society was registered in 1996. But conveyance has still not been given.

 

Hingwala told the Magistrate that he had purchased the flat from Jasmine Builders Pvt. Ltd. In 1992, Satellite Developers Pvt. Ltd. took over the rights and liabilities of Jasmine Builders Pvt. Ltd.


Hingwala argued that according to Section 11 of the MOFA, Kiran Amin, Director of Satellite Developers Pvt. Ltd. should have conveyed the property to the housing society within four months from the registration of documents.

 

Builders Arguments

 

The Builder contended that the Complainant could not move the court on his own in the absence of the co-operative housing society.

The Builder also contended that the fact that the question of conveyance is presently a subject of arbitration is a reasonable cause for not handing over possession of the plot to the Complainant and therefore, no offence under Section 13(1) of MOFA is made out.

 

The Builder further contended that new buildings were constructed by the accused in 2003 on the same land, which is required to be conveyed to Gayatri Dham, therefore conveyance cannot be executed in favour of it.

 

(Section 13(1) of MOFA provides that if the promoter is able to show reasonable cause because of which it is not possible to give conveyance, same could not constitute an offence under this Act.)  

 

Decision and Jail

 

Sri V V Patil, Magistrate at Vikhroli Court relied on the observations of the Sessions Court which had dismissed the appeal of the accused against the issuance of process in the case. The Sessions Court had observed that a Complainant, being a member of the society, is entitled to get conveyance on his behalf from the promoters under Section 11 of the MOFA. “Promoters are under legal obligation to convey the title and execute the documents in his favour. They did not convey with this legal provision. The Complainant is, thus, an aggrieved person,” the Sessions Court had said.

 

The Magistrate pointed out that the grounds of reasonable excuse raised by the accused has been rejected by the Bombay High Court and Supreme Court over the years in appeals filed by the accused. “Moreover, the offence was committed in June 1996, and there was no other construction on the land except Gayatri Dham building. Therefore, there was no excuse for the accused to withhold the conveyance,” the Magistrate held.

 

The Magistrate said, “For more than 10 years, the complainant is awaiting conveyance of the plot, which the accused failed to give. Considering the facts of the case, the conduct of the accused and intention of the legislature behind enacting the legislation, I am of the view that the accused be dealt with necessary punishment under the Act.”


Sri V V Patil, the Magistrate found Kiran Amin, Director of Satellite Developers Pvt. Ltd, guilty under the provisions of the Maharashtra Ownership of Flats Act (MOFA) and sentenced him to simple imprisonment for 2 years.

 

I am giving the link to the full decision:

http://services.ecourts.gov.in/ecourtindia/cases/display_pdf.php?filename=/orders/200349000972006_1.pdf&caseno=Summons%20Cases%20SS/4900097/2006&cCode=12&appFlag=

Maharashtra Real Estate Regulatory Authority (MahaRERA)

 

Maharashtra Real Estate Regulatory Authority (Maha RERA)

RERA has effectively started functioning in Maharashtra.

Maharashtra Government had established Maha RERA on March 8, 2017 for regulation and promotion of real estate sector in the state, with its headquarters in Mumbai.

The RERA act, lays rules and regulation for the real estate sector. It is aimed to bring in much needed transparency, efficiency, and professionalism that will further strengthen home buyers’ confidence.
 

Gautam Chatterjee appointed first Chairman of MahaRERA 

RERA-Real Estate Regulatory Authority came into effect from May 1, 2017.

Gautam Chaterjee, an IAS Officer, has been appointed the first Chairman of the Maharashtra Real Estate Regulatory Authority (Maha RERA).


First Case to be decided under RERA

In its  first case,  taken up suo moto, the RERA authority imposed penalty of Rs. 1.2 lakhs on Sai real estate consultant firm

In its first decision in a case taken up suo moto,  the Real Estate Regulatory Authority (RERA) norms that have given a big boost to home buyers, a Chembur-based real estate consultant firm has been asked to pay Rs 1.2 lakh as fine for a misleading advertisement of an ongoing construction project.

Penalised under Maharashtra Real Estate Regulatory Authority (MahaRERA) act, Sai Estate Consultant became the first firm to be fined under the act. The Authority’s order, issued on Monday,  stated that the consultant was guilty of advertising a project which wasn’t registered with it at the time of advertising.

Under the new rules, advertising for sale of flats in projects that are not registered with the Authority is considered as a violation under the rules of the regulatory body. The firm, which advertised a project of Haware builders in Thane, has also been asked to withdraw the advertisement and restrain from promoting it in absence of the Authority’s registration.

In addition to the fine, the firm has also been asked to tender an apology. The action comes as result of a complaint, filed in this regard from consumer activist outfit, the Mumbai Grahak Panchayat. “We welcome this bold order, and hope builders and real estate agents learn lessons from it,” the activist outfit was quoted as saying by Indian Express.

The entire decision is available at the following site:

https://maharera.mahaonline.gov.in/Site/Upload/pdf/Legal-Advisor-MahaRERA-Vs-Sai-Estate-Consultant-Chembur-Pvt-Ltd-Suo-Motu-Case-No-1-of-2017-dated-5-06-2017.pdf


Important Links

The MAHARERA site states that even if you have filed a complaint in the Consumer Forum, you can with draw the same, and file the Complaint or application in RERA.

https://maharerait.mahaonline.gov.in/PDF/FAQMergedPDF.pdf

  1. If the buyer wants to file a complaint in Consumer Court, is there any bar under the Act?

Ans: No. As per section 79 of the Act, civil courts are barred from entertaining disputes (suits or proceedings) in respect of matters which Real Estate Regulatory Authority or the adjudicating officer or the Appellate Tribunal is empowered under the Act to determine. However, the consumer forums (National, State or District) have not been barred from the ambit of the Act. Section 71 proviso permits the complainant to withdraw his complaint as regards matters under section 12, 14, 18 and section 19, from the consumer forum and file it with the adjudicating officer appointed under the Act.

Web Site of MahaRERA

Link to the Web site of RERA where you can download the Act, Rules and  other documents.

https://maharera.mahaonline.gov.in/Home/Index