Mumbai builder pulled up: MahaRERA awards ₹3 crore interest for 5-year home delay
Possibly setting a precedent for hundreds of construction projects delayed much beyond their promised possession date, the MahaRERA on Monday ordered a builder to pay crores in interest to homebuyers of a project delayed by five years. One homebuyer, who had purchased multiple flats worth Rs 8 crore, has been ordered to be paid over Rs 3 crore in collected interest. The project in question is the Wintergreen building, part of the Rivali Park project of the promoter CCI Projects Private Limited on the Western Express Highway, Borivali.Initially promised their homes in 2016, the possession date was delayed multiple times till 2021. 40 homebuyers in the building had complained to the MahaRERA throughout the years, as the promoter extended the possession date multiple times till 2021. “In 2012, my client Rajesh, 65, and Surali Joshi, 64, paid around Rs 8.4 crore for 6 flats in the Wintergreen building, on a promised possession date of 2016,” said their lawyer, Aditya Pratap. “But as the possession date passed without any sign of the homes, the Joshi’s complained to MahaRERA, first in 2018 and next in 2019.” Most of the other homebuyers paid between Rs 1 crore to 3 crore for their flats, paying their purchase amount over varying time periods. As per Section 18 of RERA Act, 2016, homebuyers are entitled to demand compensation if a promoter fails to deliver a project on the specified possession date, either in the form of interest on the amount or refund. In this case, the homebuyers demanded interest. An order by the MahaRERA in 2020 ruled on the side of the allottees, directing the promoter to pay the 40 homebuyers interest at 9% per annum from 1st September 2016 (six months after the contractual possession date of February 2016) until the actual date of possession, along with costs and penalty.Story continues below this ad On getting possession of the flats in 2021, the promoter appealed against the MahaRERA’s order. A final judgement, after 8 long years of the case, was delivered on Monday. “What sets this order apart is that the MahaRERA decided on several claims brought up by the promoter, strengthening homebuyers rights in similar cases in the future,” said Pratap. “For one, the promoter claimed that as homebuyers continued their payments towards their homes even when informed by letters about the delayed possession date, without any objections, they forged the right to interest. The MahaRERA did not accept this. The promoter tried to invoke Section 55 of the Indian Contract Act, 1872, which deals with timeline of contracts, but the MahaRERA ruled that the RERA Act prevails over it. Once the homebuyers received possession, that they accepted the homes also does not bind the allottees from claiming their rights. The promoter also blamed the delays on unforeseeable circumstances, like sand scarcity, the covid pandemic, and defaulting by their lender Indiabulls’, all of which the MahaRERA court did not accept.”
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