Real Estate
Karnataka RERA Orders Refund of Rs 82 Lakhs to Homebuyer Due to Delay in Possession
By GeoSquare News Desk · Published 2024-07-14
In a significant verdict, the Karnataka Real Estate Regulatory Authority (RERA) has directed Ozone Urbana Infra Developers to refund Rs 82 lakhs to a homebuyer who had been waiting for possession of their flat since 2022. The authority's order comes after the builder failed to hand over the flat on time, despite receiving a substantial amount of money from the homebuyer.
The homebuyer had purchased a flat in Ozone Urbana Infra's project, Urbana Avenue, which is part of the integrated township project Ozone Urbania. According to the agreement, the builder was supposed to hand over the flat by December 2022, with a 6-month grace period. However, despite paying Rs 56,28,790 out of the total cost of Rs 66,17,808, the builder failed to provide possession of the flat on the promised date.
The homebuyer contended that the builder had repeatedly delayed the possession handover date, had not provided any updates on the project, and had stopped communicating with them, leaving them uncertain about the flat's possession date. Aggrieved by the delay, the homebuyer decided to withdraw from the project and filed a complaint before the authority seeking a refund with interest.
Observation and Direction by the Authority
The authority observed that despite entering into a contract to hand over the flat to the homebuyer by June 2023 (including the grace period) and receiving a significant amount of money, the builder had failed to follow the terms of the agreement and had not handed over possession of the flat. Therefore, the authority held that the homebuyer was entitled to a refund of the entire amount with interest.
The authority referred to the Supreme Court's decision in M/s Newtech Promoters and Developers Pvt. Ltd vs. State of Uttar Pradesh & Ors, where it was held that if the builder fails to give possession of the apartment, plot, or building within the time stipulated under the terms of the agreement, then the homebuyer's right under the RERA, 2016 to seek a refund or claim interest for delay is unconditional and absolute, regardless of unforeseen events or stay orders of the Court/Tribunal.
The authority also referred to the Supreme Court's decision in the case of M/s Imperia Structures Limited v. Anil Patni & Another, where it was held that under Section 18 of the RERA Act, if a builder fails to complete or give possession of an apartment by the specified date, the builder must return the amount received if the homebuyer wishes to withdraw from the project.
Therefore, the authority allowed the homebuyer to withdraw from the project and directed the builder to refund Rs 82,58,652 to the homebuyer within 60 days.
Karnataka Real Estate Regulatory Authority (RERA) is a statutory body established under the Real Estate (Regulation and Development) Act, 2016 to regulate and promote the real estate sector in Karnataka. Ozone Urbana Infra Developers is a prominent real estate developer in Karnataka known for its integrated township projects.