Is Allotee under allotment letter mentioned as “Investor” is real investor to be treated as Co-promoters?

By Dr Sanjay Chaturvedi, LLB, PhD

 Mr. Ketan Gagra V/s JVPD Properties Pvt. Ltd (CC006000000001312) Order Dated: 11th April 2018

The complainants have filed these complaints under SecfLon7,72 & 14 of the Real Estate (Regulation and Development) Act, 2015 (RERA) to claim refund of ttteir amount from the respondents with interest. The respondents have filed their reply The relevant portion thereof demonstrates that the complainants are investors and therefore, the Authority has no jurisdiction to entertain their complaints.

Maha RERA Observed: All the terms and conditions of the allotment letters clearly indicate that the complainants agreed to purchase the flats for consideration to be paid by them in instalments depending upon the stages of the construction and the last instalment payable was at the time of handing over the possession. Therefore, merely because it is mentioned in Clause 10 of the allotment letters that the complainants are investors that will not make them the investors in the real sense. A person who pays money to the promoter in anticipation of buying a flat, in fact, invests his money for house and therefore, Section 12 of RERA also refers to such amount as investment. Only because the complainants have deposited their amount with the respondents, it does not mean that they become the Investor interested in earning profits. The respondents have not produced any evidence to prove that the complainants are in habit of investing their funds for earning profit. Therefore, I hold that in the facts and circumstances of the cases, the complainants do not appear to be investors but they are allottees.

Credits: Landmark Judgements of RERA (Book)

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