Even no date of possession mentioned in agreement for sale attract penal interest: MahaRERA

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By Rohit Sharma


The recent judgment of Maharashtra Real Estate Regulatory Authority (MahaRERA) clearly says that if there is no possession date written in the agreement then it’s a violation of Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963 (MOFA).

As many as 32 homebuyers filled a complaint against Nirmal Lifestyle Ltd. with MahaRERA regarding the delay of the project and for not handing over possession. Both builder and homebuyers executed an agreement for sale in 2005 till date homebuyers haven’t received the possession date.

Complainants before the court prayed for directing the builder to hand over the flats with occupancy certificate (OC) and also they want the builder to form co-operative housing society and pay the interest for a period of delay.

The advocate from builder’s side said, “The project had delayed because a dispute started that a part of the project land was private forest and in May 2006 Municipal Corporation of Greater Mumbai issued ‘stop work notice’. As a result, the project remained standstill. Finally, in 2015 the entry of private forest land was deleted from other rights columns for GTS No. 491A.”

He further refused the arguments and submissions made by the complainants and said complainants are while entering into agreement no date of possession had been agreed and it’s wrong to say that they entitled for compensation.

The court ordered, “No date of possession has been written in the agreements, which was, in fact, a violation of the provision of MOFA Act, 1963 and this could also be due to reason  that the parties were uncertain about the future of the project.”

The dispute regarding the part of the project land being Private Forest Land started in the year 2006 and was resolved after the judgement of the Supreme court in 2014. “During this period the respondent could not continue the construction work because of the ‘stop work’ notices issued by the concerned authority. However, for the home buyers this resulted in a long waiting time to get their flats event after the payment of almost entire consideration value”, the court said.

During the 2006 and 2014, the builder could have refunded the allottees their money and give them compensation as a project was getting delayed.

“The omission of the date of possession in the agreement does not entitle the promoter to take an indefinite time to complete the project and make the allottees wait for more than 13 years. It is obligatory for him to give a definite date for completion of the project to the allottees”, said the court.

The court directed the builder to pay interest to the homebuyers from January 2015 till the actual date of possession and also to complete the formation of the cooperative housing society.

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