Order Complaint No. 19 of 2025

BEFORE TELANGANA REAL ESTATE REGULATORY AUTHORITY
[Under the Real Estate (Regulation and Development) Act, 2016]
Complaint No. 19 of 2025
21st November 2025
Quorum:

Dr. N. Satyanarayana, IAS (Retd.), Hon’ble Chairperson
Sri K. Srinivasa Rao, Hon’ble Member
Sri Laxmi Narayana Jannu, Hon’ble Member

Allamneni Moni Chandra
(Plot No. 226, Road No. 78,
Astha Green Building,
Opp: HDFC Film Nagar Branch,
Jubilee Hills, Hyderabad 500096)

… Complainant
Versus
1. M/s. Surabhi Estates Pvt. Ltd.
(Unit 20-21, First Floor, Minerva Complex,
Sarojini Devi Road, Kalasiguda,
Secunderabad – 500003)

2. Sri. S.E. Srinivas
(Occ: Managing Director
R/o. Sy. No. 292, H. No. 4-222/1,
Ram Reddy Nagar, IDA Jeedimetla,
Phase V, Hyderabad – 500055)

… Respondents
The present Complaint came up for hearing on 08.08.2025 before this Authority in
the presence of Counsel for the Complainant, Sri S. Vijay Kumar, and Counsel for the
Respondents, Sri M. Srinivas. Upon hearing the submissions advanced by both sides and having
reserved the matter for orders, this Authority now proceeds to pass the present ORDER:
2.

The present Complaint has been filed by the Complainant under Section 31 of the Real

Estate (Regulation & Development) Act, 2016 (hereinafter referred to as the “RE (R&D) Act”)
read with Rule 34(1) of the Telangana Real Estate (Regulation and Development) Rules, 2017
(hereinafter referred to as the “TG RE(R&D) Rules”) seeking appropriate relief(s) against the
Respondent.
A. Brief facts of the Case:
3.

The Complainant humbly submits that Respondent No.1, having its registered office at

Secunderabad, is engaged in the real estate business, and Respondent No.2, its director, is
responsible for its affairs. Respondents indulged in unfair trade practices in violation of RERA
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The Respondents thereafter induced the complainant to shift his allotment to Phase-II

on the pretext of offering a bigger villa, though no TG RERA approval existed for Phase-II either.
The Respondents continued to market and sell villas in Phase-II without securing mandatory
permissions, thereby misleading the complainant and other buyers.
5.

Upon delay of permissions and failure to proceed with Phase-II, Respondent No.2 assured

refund of amounts with interest. An MOU was executed, and six cheques were issued towards
repayment. However, when presented, multiple cheques were dishonoured for the reason “Funds
Insufficient.” After legal notice was issued, the Respondents sought amicable settlement,
requested return of the dishonoured cheques, and issued three fresh cheques drawn on SBI,
Vikrampuri Branch. These too were dishonoured on 14.11.2023 for “Funds Insufficient,” and
Respondents thereafter failed to respond or make payment.
6.

The complainant submits that entering into agreements without obtaining TG RERA

approval, collecting huge sums, and subsequently issuing dishonoured cheques constitute
fraudulent conduct. The Respondents deliberately misrepresented facts, failed to fulfill their
obligations, and violated Sections 11(4) and 18 of the RE (R&D) Act, 2016.
7.

It is further submitted that the Respondents’ acts amount to fraud and cheating, not only

against the complainant but also against several other innocent buyers. The repeated dishonour
of cheques clearly demonstrates fraudulent intent and non-compliance with law.
8.

The complainant, therefore, prays that this Hon’ble Authority cancel the permissions

granted to the Respondents, initiate administrative and criminal action against them, and grant
such further reliefs as deemed fit. The complainant also reserves his right to pursue remedies
under Section 138 of the Negotiable Instruments Act, 1881, and to file additional documents or
affidavits as necessary in the interest of justice.

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In light of the aforementioned facts, the Complainant had prayed for the following reliefs

before the Authority:
a. To punish the respondents for violating various provisions of TG RERA Provisions by
way of imprisonment of Respondents along with penalty.
b. To cancel the approval to the Respondents project.
c. To refund the Rs. 35,00,000/- with 18% rate of interest P.A from the date of Agreement
of Sale dated on 06.01.2020.
d. To pass such other orders as this Hon'ble Authority deems fit and proper in the facts and
circumstances of the case in the interest of equity and justice.
C. Counter on behalf of the Respondent No. 2:
10.

The Respondent submits that at the outset, they deny all allegations made in the Complaint.

The Complainant has misrepresented and concealed material facts for his benefit and filed a
frivolous case with false and misconceived averments. The Respondents are law-abiding, aware
of their duties, and strictly follow all rules, guidelines, and laws.
11.

The Respondent submits that the averments in the Complaint regarding certain allegations

are matters of record and need no response, while other averments are specifically denied, and
the Complainant is put to strict proof. The Respondents are experienced in construction and have
no prior complaints of violation. The present Complaint is filed with mala fide intention to extract
money by making false allegations.
12.

The Respondent submits that the Complainant himself entered into an Agreement of Sale

dated 06.01.2020 for Villa No.20 in Phase-I, which had HMDA approval dated 29.06.2015, much
before the enactment of RE(R&D) Act, 2016. Telangana RERA rules apply only to projects
approved after 01.01.2017. Hence, the Complaint is frivolous and misleading.
13.

The Respondent submits that the allegations in the Complaint relating to subsequent

transactions are misconceived. As per the MOU dated 22.01.2020, the Complainant requested
cancellation of the earlier Agreement and sought a bigger villa in Phase-II, fully aware that
approvals were in process. Later, TG RERA approval No. P1100007763 was obtained for PhaseII. However, the Complainant withdrew from the project for personal reasons and demanded
repayment of Rs. 1,69,00,000/-.
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The Respondent submits that the Complainant admitted in his legal notice dated 27.03.2024

that he received the entire agreed amount except Rs. 35,00,000/-, the reasons for which were
explained in the reply notice. Payments were made through various modes, as shown in
documents, and acknowledged by the Complainant. The averments in the Complaint regarding
dishonour of cheques are therefore denied.
15.

The Respondent submits that the Complainant knowingly signed the MOUs, which

recorded that allotment in Phase-II would be made after obtaining permissions. Further, the MOU
dated 04.01.2023 confirms that the Complainant withdrew for personal reasons and claimed Rs.
1,69,00,000/- with interest. Hence, he is not an “allottee” under RERA and is not entitled to any
relief or compensation. The Complaint is baseless, deserves dismissal, and the Respondents pray
that it be dismissed with costs for causing unnecessary litigation and harassment. The Respondent
No.2 further places on record the following payments made in discharge of obligations, which
evidence that there are no subsisting dues towards the Complainant:
Date

Mode of
Payment
Cash

Amount
(Rs.)
25,00,000

14.08.2023

Demand
Draft

20,00,000

14.08.2023

Cheque

5,00,000

14.08.2023

Cheque

34,00,000

14.08.2023

Cheque

12.12.2023

12.12.2023

23.05.2023

Instrument Details

Remarks

Against Cheque No.191152
dated 15.03.2023, The A.P.
Janata Co-op Urban Bank
Ltd.
DD No.292778 dated
14.08.2023, Bank of
Maharashtra, S.D. Road,
Secunderabad
Cheque No.947370 dated
05.09.2023, SBI,
Vikrampuri, Secunderabad
Cheque No.947371 dated
15.10.2023, SBI,
Vikrampuri, Secunderabad

Cheque returned as full amount
received in cash.

35,00,000

Cheque No.947373 dated
15.10.2023, SBI,
Vikrampuri, Secunderabad

In lieu of bounced Cheque
No.191157 dated 30.04.2023 (Rs.35,
00,000). Returned cheque enclosed.

Demand
Draft

25,00,000

In lieu of bounced Cheque
No.947371. Returned cheque
enclosed.

Cash

9,00,000

DD No.292908 dated
12.12.2023, Bank of
Maharashtra, S.D. Road,
Secunderabad
Cash payment

In lieu of bounced Cheque
No.191153 dated 31.03.2023 (Rs.25,
00,000). Returned cheque enclosed.
In lieu of bounced Cheque
No.191153. Returned cheque
enclosed.
In lieu of bounced Cheque
No.191154 dated 15.04.2023 (Rs.34,
00,000). Returned cheque enclosed.

Part replacement of bounced Cheque
No.947371 (Rs.34, 00,000).

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Cheque

5,00,000

12.12.2023

Cheque

35,00,000

Cheque No.947383 dated
23.12.2023, SBI,
Vikrampuri, Secunderabad
Cheque No.947384 dated
03.01.2024, SBI,
Vikrampuri, Secunderabad

In lieu of bounced Cheque
No.947370 dated 05.09.2023.
Returned cheque enclosed.
In lieu of bounced Cheque
No.947373 dated 15.10.2023.
Returned cheque enclosed.

D. Points for Consideration:
Whether the Respondents have violated Section 3 of the Real Estate (Regulation and

I.

Development) Act, 2016?
Whether the Complainant is entitled to the relief sought?

II.
Point I:
16.

Upon a meticulous examination of the documents placed on record and after considering

the submissions of both parties, it is an undisputed fact that the Complainant entered into an
Agreement of Sale dated 06.01.2020 with Respondent No.1 for Villa No. 20, admeasuring 160.02
sq. yds with a built-up area of 2051.72 sq. ft., situated in Survey Nos. 19/AA1, 19/AA2, 19/E1
and 19/E2, Osman Nagar, Ramachandrapuram Mandal, Medak District, Telangana, forming part
of the project styled as “Surabhi’s Signature Villas.” The total sale consideration was
₹1,30,00,000/-, out of which the Complainant paid ₹1,00,00,000/-, duly acknowledged by the
Respondent No.1.
17.

The Complainant submitted that Respondent No.1 later persuaded him to shift the

allotment from Phase-I to Phase-II on the assurance of a larger villa. Relying on such
representation, the Complainant consented to the shift. However, it subsequently emerged that
Phase-II had no statutory approvals, and permissions were only in process. Despite this,
Respondents continued marketing the said Phase-II units. Eventually, acknowledging their
inability to proceed, the Respondents executed an MOU, agreeing to refund the amounts taken
and to pay an additional sum of ₹69,00,000/- with interest. Cheques were issued in part
performance of the MOU, but all such cheques were dishonoured with the remark “Funds
Insufficient.”
18.

Respondents No.1 and 2 contended that the project had already obtained HMDA approval

vide Proceedings No.102839/LO/Plg/HMDA/2013 dated 29.06.2015, i.e., prior to the
commencement of the RERA Act. Thus, they argued that the project is exempt from the Act, as
RERA applies only to projects approved on or after 01.01.2017. They further contended that the
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To examine the Respondents’ objection, this Authority refers to Section 3(1) of the Act.

Any project exceeding eight units or 500 sq. m. for which no Completion Certificate or
Occupancy Certificate has been issued as on the date of commencement of the RE(R&D) Act,
automatically qualifies as an “ongoing project.” Further, Rule 2(1)(j) of the Telangana RERA
Rules, 2017, as amended, defines an “ongoing project” as a project where development is in
progress and for which the Occupancy Certificate or Completion Certificate has not been issued
as on the date of commencement of Section 3 of the RE(R&D) Act. The amended Rule 2(1)(j)
was intended to harmonise the definition with Section 3 itself. In the present case, the
Respondents have not placed on record any Occupancy Certificate for Phase-I of the project. A
mere assertion that the project obtained an approval before 01.01.2017 does not confer exemption
when the project remains incomplete for want of statutory post-construction certifications.
Therefore, the Respondents’ contention that the project does not fall within the jurisdiction of
this Authority is untenable. The project is squarely an ongoing project and ought to have been
registered under Section 3 of the RE(R&D) Act.
20.

In light of the above findings, this Authority unequivocally holds that the project qualifies

as an ongoing project under the RE(R&D) Act. The preliminary objection raised by the
Respondents is without merit and is accordingly rejected. As Phase-I remains unregistered,
Respondents No.1 and 2 are directed to forthwith initiate registration of Phase-I and ensure strict
compliance with all provisions of RE(R&D) Act.
21.

However, considering the ambiguity that prevailed at the relevant time due to the earlier

interpretation of Rule 2(1)(j), this Authority is inclined to adopt a lenient view with respect to
penal action. Accordingly, while the Authority holds that the project ought to have been
registered, it refrains, at this stage, from invoking Sections 59 and 60 of the RE(R&D) Act.

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Nevertheless, the Respondents are strictly restrained from undertaking any further

advertising, marketing, booking, selling, offering for sale, or inviting persons to purchase any
villa or plot in the said project until registration is duly obtained. Any future violation will attract
appropriate action under Sections 59, 60, and 63 of the Act.
23.

However, considering the ambiguity prevailing at the relevant period regarding the

interpretation of Rule 2(1)(j), this Authority is inclined to take a lenient view regarding the
imposition of penalties. While the Authority holds that registration was mandatory and has been
violated, it refrains, at this stage, from invoking Sections 59 and 60 of the RE(R&D) Act.
24.

Additionally, this Authority takes serious note of the fact that the Respondents have

indulged in a pre-launch offer in respect of Phase-II. Entering into an MOU for Phase-II even
before registering the said phase clearly indicates that the Respondents were inviting persons to
purchase units and offering to sell units prior to registration, in violation of Section 3 of the
RE(R&D) Act. Accordingly, such conduct constitutes a violation attracting Section 59 of the
RE(R&D) Act, pertaining to contraventions arising from pre-launch activities.
Point II:
25.

The Complainant seeks refund of the balance sum of ₹35,00,000/- along with interest @

18% per annum from the date of execution of the Agreement of Sale dated 06.01.2020.
26.

As previously noted, the Complainant entered into the Agreement after paying

₹1,00,00,000/- and was later persuaded to shift to Phase-II based on the Respondents’ assurance
of a larger villa. Upon learning that Phase-II lacked approvals, the parties executed an MOU
wherein the Respondents agreed to refund the principal amount and pay an additional
₹69,00,000/- as interest/compensation. Cheques issued in furtherance of this arrangement were
dishonoured.
27.

A perusal of the MOU dated 22.01.2020 shows that, the amounts paid for Phase-I were

to be transferred upon the Respondents obtaining necessary permissions, upon obtaining
approvals, a fresh allotment of a west-facing villa of approx. 220 sq. yds and 2500 sq. ft. was to
be made, and a fresh sale agreement was to be executed thereafter. However, due to delays in
securing permissions, the Complainant withdrew. The Authority notes that purchasers entering
into pre-launch arrangements do so at their own risk, and the Authority has repeatedly cautioned
against pre-launch transactions. The Complainant contends he was compelled to shift from

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Subsequently, the parties executed an MOU dated 04.01.2023 outlining revised terms of

settlement and repayment. As per the Respondents’ counter and the Complainant’s memo dated
08.01.2025, the total amount claimed is ₹1,69,00,000/-, being the principal plus mutually agreed
interest.
29.

The Complainant has admittedly received the principal amount of ₹1,00,00,000/- and

₹34,00,000/- out of the agreed interest amount of ₹69,00,000/-. The present claim pertains to the
balance interest amount of ₹35,00,000/-, along with additional interest thereon.
30.

The Respondents argued that the Complainant ceased to be an allottee after cancellation

of the original Agreement and hence cannot invoke RERA. This contention is rejected, as
cancellation is not complete until all obligations under the cancellation arrangement are fulfilled.
An allottee cannot be deprived of statutory protection merely because the promoter has
unilaterally failed to honour the terms of cancellation. Thus, the Complainant continues to enjoy
protection as an allottee under the RE(R&D) Act.
31.

This Authority, however, is of the considered view that interest on the unpaid interest

component (i.e., interest on interest) cannot be entertained. The Authority does not adjudicate
upon compounded interest arising out of purely contractual settlements mutually negotiated
between parties.
32.

Nevertheless, being a beneficial legislation, intended to protect the interests of allottees,

and considering that the Respondents have retained the Complainant's funds for more than three
years, and that the Respondents themselves undertook the contractual obligation to pay the agreed
interest amount of ₹69,00,000/-, of the fact that currently the project stands registered before this
Authority. The Complainant has been deprived of the benefit of his funds since 2020, this
Authority holds that the Complainant is entitled to the unpaid portion of the agreed interest
amount, i.e., ₹35,00,000/-.
33.

Accordingly, while interest on interest is declined, this Authority directs that the balance

contractual interest amount of ₹35,00,000/- shall be paid by the Respondents to the Complainant
within 45 days from the date of this Order.

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In light of the foregoing discussion, findings, and conclusions recorded hereinabove, and

in exercise of the powers conferred upon this Authority under Sections 37 and 38 of the Real
Estate (Regulation and Development) Act, 2016, the following directions are hereby issued to
the Respondents:
i.

This Authority declares that the project titled “Surabhi’s Signature Villas” Phase-I
qualifies as an “ongoing project” under Section 3(1) of the RE (R&D) Act, 2016 read
with Rule 2(1)(j) of the Telangana Real Estate (Regulation and Development) Rules,
2017. The Respondents were under a mandatory statutory obligation to register the said
project with this Authority and have failed to do so. Accordingly, the Respondents are
hereby directed to forthwith apply for registration of the project “Surabhi’s Signature
Villas” Phase I with this Authority within 30 (thirty) days from the date of this Order, in
compliance with Section 3 and 4 of the RE(R&D) Act, 2016.

ii.

The Respondents are hereby restrained from advertising, marketing, booking, selling,
offering for sale, or inviting persons to purchase any unit in Phase-I of the said project
until the requisite registration under the RE (R&D) Act, 2016.

iii.

This Authority directs the Secretary, Telangana RERA, to immediately initiate
proceedings under Section 59 of the Act for the imposition of an appropriate penalty upon
the Respondents, subject to the approval of this Authority, in respect of the contraventions
arising from the pre-launch offers of Phase-II of the said project.

iv.

Respondents No.1 and 2 shall pay to the Complainant the unpaid contractual interest
amount of ₹35,00,000/- (Rupees Thirty-Five Lakhs only) within 45 days from the date of
this Order.

35.

Failing to comply with the above said directions by the Respondents No.1 and 2 shall

attract penalty in accordance with Section 63 of the RE (R&D) Act, 2016.
36.

The Complaint is disposed of in lieu of the above directions. No order as to costs.

Sd/-

Sd/-

Sd/-

Sri. K. Srinivasa Rao,
Hon’ble Member

Sri. Laxmi Naryana Jannu,
Hon’ble Member

Dr. N. Satyanarayana, IAS (Retd.),
Hon’ble Chairperson

TG RERA

TG RERA

TG RERA

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