MahaRERA Dismisses Complaints: Investors Without Registered Sale Agreements Cannot Seek Relief

The Maharashtra Real Estate Regulatory Authority (MahaRERA) has dismissed multiple complaints against a stalled project near Mumbai. The Authority held that investors relying on investment documents cannot seek relief under the Real Estate (Regulation and Development) Act, 2016, in the absence of a duly executed and registered agreement for sale.

The order stated, “It is observed that none of the complainants, except the complainant at sr. no. 3, have placed on record the allotment letters issued by the respondent. In the absence of allotment letters, the foundational document evidencing allotment of a specific apartment, consideration, and contractual obligations between the parties is missing, which materially affects the maintainability and adjudication of the complaints.”

The complainants had placed on record an ‘Investment Document’ that described them as “investors” and not as purchasers or allottees seeking a residential unit. This distinction is significant when examining the applicability of section 18 of the Act, which deals with delays in possession “in terms of the agreement for sale,” as noted by the Authority.

A group of 11 individuals approached MahaRERA, claiming they were bona fide allottees (homebuyers) who booked residential flats in a project near Mumbai. They alleged that the developer failed to execute and register agreements for sale with them, in clear violation of section 13 of the RERA Act, 2016, while continuing to demand further payments. The individuals paid over ₹3.70 crore to the developer between 2016 and 2018, with 10 of them entering into investment documents and one receiving an allotment letter.

The complainants submitted that there has been “negligible and sporadic construction” activity at the site over several years, with only a few slabs completed and no commensurate progress to justify the prolonged delay in completion and possession. They alleged that the developer had unilaterally altered material terms, including possession timelines, flat numbers, floor levels, carpet areas, and consideration amounts, without their consent and without executing registered agreements.

The developer, in response, stated that the complaints are “false, frivolous, vexatious, and not maintainable” and deserve dismissal. The developer argued that many of the complainants acknowledged themselves as “investors” under the investment documents. The developer also claimed that the complainants defaulted in payment of lawful and stage-wise demands, failed to pay applicable taxes, stamp duty, and registration charges, and did not come forward to register the agreements for sale due to their own financial constraints or inability to secure loan approvals.

The developer further contended that construction of the project was stalled due to factors beyond its control, including a court injunction from a neighboring society, the COVID-19 pandemic, nationwide lockdowns, labor shortages, supply chain disruptions, and a steep rise in construction material costs, all of which constitute force majeure events under section 6 of the RERA Act.

MahaRERA, in its verdict, noted that all complainants have placed on record the “Investment Document,” which describes them as “investors” rather than purchasers seeking a residential unit. The Authority also observed that none of the investment documents placed on record by the complainants has been signed by them, except for two complainants. “In the absence of signatures, the evidentiary value, authenticity, and enforceability of such documents remain doubtful, and the same cannot be relied upon to conclusively establish contractual obligations or reciprocal rights under the Act,” the order said.

The Authority further observed that no duly executed and registered agreements for sale, as contemplated under section 13 of the Act, have been entered into by both parties. “In the absence of an agreement for sale specifying a definite date of possession, the essential condition for invoking section 18 of the Act, namely delay in handing over possession ‘in accordance with the terms of the agreement for sale,’ is not satisfied,” the order said.

The MahaRERA concluded that the present complaints are not maintainable under the Act and do not warrant adjudication on merits, the order added.