Order Complaint No. 209 of 2024

BEFORE TELANGANA REAL ESTATE REGULATORY AUTHORITY
[Under the Real Estate (Regulation and Development) Act, 2016]
Complaint No. 209 of 2024
25th April, 2025
Corum:

Dr. N. Satyanarayana, IAS (Retd.), Hon’ble Chairperson
Sri K. SrinivasaRao, Hon’ble Member
Sri LaxmiNarayanaJannu, Hon’ble Member

1. Sri. Marimuthu Krishnan,
(S/o. MuthuramalingamMarimuthu,
Aged about 47 years, Occ: Teacher,
R/o. H.No. A51 AnandaNivas, Faculty Quarters, IIIT Hyderabad,
Gachibowli, Hyderabad, Telangana-500032)

2. Smt. Moumita Saharay
(W/o. Marimuthu Krishnan,
Aged about 47 years, Oce: Teacher,
R/o. H.No. A51 AnandaNivas, Faculty Quarters, IIIT Hyderabad,
Gachibowli, Hyderabad, Telangana-500032)

...Complainant(s)

Versus
1. M/s. Fortune99homes Infra Pvt. Ltd.,
(through its Managing Directors,
Sri.MadhiralaRosi Reddy, Sri. Kota Vijay Babu& Sri. DhanunjayaGanjikunta,
Registered Office: Cyber Heights, 1st and 2nd Floor,
Road No. 2, Banjara Hills, Beside NTR Trust Lane, Hyderabad
Telangana-500034, India)
2. Sri. MadhiralaRosi Reddy,
(S/o. M. Poli Reddy,
Registered Office: Cyber Heights, 1st and 2nd Floor,
Road No. 2, Banjara Hills, Beside NTR Trust Lane, Hyderabad,
Telangana-500034, India)
3. Sri. Kota Vijay Babu, S/o. Alfred,
(Registered Office: Cyber Heights, 1st and 2nd Floor,
Road No. 2, Banjara Hills, Beside NTR Trust Lane, Hyderabad,
Telangana-500034, India)
4. Sri. DhanunjayaGanjikunta,
(Registered Office: Cyber Heights, Ist and 2nd Floor,
Road No. 2, Banjara Hills, Beside NTR Trust Lane, Hyderabad,
Telangana-500034, India)

...Respondent(s)

This complaint came up for hearing before us on 18.12.2024, in the presence of Sri
Drupad Sangwan, Advocate for the Complainants and Respondent 1 to 4 remained ex-parte;
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upon persuing the material on record and hearing arguments of the learned counsel for the
complainants and having stood over for consideration till this day, the following order is
passed:
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 “Act”) read with
Rule 34(1) of the Telangana Real Estate (Regulation and Development) Rules, 2017
(hereinafter referred to as the “Rules”) seeking appropriate relief(s) against the Respondents.
A. The Brief facts of the case as per allegations/averments contained in the
complaint are as follows:

3.

The Complainants submitted that Respondent No. 1, Fortune99 Homes, represented

themselves as the sole owner of a 7-acre and 22-gunta property, as per Registered Sale Deed
Document No. 496/2021. They advertised their project "FORTUNE PHARMA CITY 1" as a
lucrative investment opportunity. After persistent persuasion by Respondent No. 1’s
representatives, the Complainants agreed to purchase six open plots at Rs. 5,300 per square
yard. This led to the execution of two Agreements of Sale on 11.08.2021, for a total
consideration of Rs. 63,60,000/-.
4.

The first Agreement of Sale pertained to the sale of Open Plot Nos. 215 to 219,

covering 1,000 square yards within the "FORTUNE99 HOMES" project, located in Survey
Nos. 654 and 655 at Nandiwanaparthy Village &Grampanchayat, YacharamMandal, Ranga
Reddy District, as well as in Land Bearing Nos. 144, 145, 153, and 154 situated at
NazikSingaram Village. The sale price for these plots was Rs. 53,00,000/-. The second
agreement concerned Open Plot No. 182, covering 200 square yards, with a sale price of Rs.
10,60,000/-. The total sale consideration for both plots was Rs. 63,60,000/-.
5.

The Complainants made payments totaling Rs. 31,80,000/-, which represented 50% of

the total sale price. Receipts acknowledging these payments were issued by Respondent No.
1. However, despite these payments, the Respondents failed to fulfill their contractual
obligations by not registering the plots within the agreed timeline.
4.

The Complainants further alleged that Respondent No. 1 altered the project layout

from the original plan, requiring them to purchase additional land, which increased the total
area from 1,200 square yards to 1,372.20 square yards, without their prior consent. The
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Respondents then coerced the Complainants into making an additional payment of Rs.
25,00,000/- under the pretense of completing the registration, which was paid via three
cheques. Despite receiving these payments, the Respondents failed to proceed with the
registration.
5.

The Complainants also asserted that, despite promises made during the agreement,

there was little to no progress on the ground concerning the development of the "Fortune
Pharma City 1" project. The absence of essential infrastructure, such as roads and sewage
systems, raised concerns about the Respondents' ability to complete the project as originally
planned. Moreover, the promotional materials, including brochures, misrepresented the
project, with discrepancies in the layout, plot sizes, and overall quality. The Complainants
further claimed that the Respondents failed to disclose the lack of necessary statutory
approvals, which exposed them to legal risk.
6.

The Complainants highlighted that, despite repeated assurances from the Respondents

that the registration would be completed soon, no progress was made. They also claimed that
the Respondents used pressure tactics to force them into accepting altered sale terms and
making additional payments.

Furthermore,

the Respondents

became increasingly

unresponsive to their inquiries, leaving the Complainants uncertain about the status of their
investment.
B. Relief(s) Sought:
7.

Aggrieved by the acts of the Respondent, the Complainants pray for the following:
a. Direct a full refund of Rs. 56,80,000/- paid on various dates along with interest of
18% Per Annum till the date of Realisation.
b. Direct the Respondents to register the project with RERA.
c.

Initiate proceedings against the Respondents for violating Section 3 of the Real
Estate (Regulation and Development) Act, 2016, by engaging in the sale of
units/plots in a real estate project without obtaining the required RERA permissions.

d. Initiate penalty proceedings against Respondents Under Section 61 of The Real
Estate (Regulation and Development) Act, 2016 for not registering the project.
e. Grant such other relief as this Hon’ble Authority deems fit and proper in the
circumstances of the case.

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C. Points for Consideration
8.

Upon due deliberation of the pleadings, contentions, and documents placed on record by

the Complainants, the following issues arise for consideration before this Authority:
I. Whether the Complainants are entitled to the reliefs as prayed for? If yes, to what extent?
II. Whether the Respondent has violated Sections 3 and 4 of the Real Estate (Regulation and
Development) Act, 2016 ["RE(R&D) Act"] by failing to register the project titled
“FORTUNE99 HOMES” with this Authority? If so, whether the Respondent is liable to be
penalized for such violation?
D. Observation of the Authority:
9.

The factual matrix reveals that the Complainants were allotted plots bearing Nos. 215

to 219, aggregating to 1,000 square yards, in the project titled “Fortune99 Homes” promoted
by the Respondent. The Agreement of Sale was executed on 11.08.2021 for a total sale
consideration of Rs. 63,60,000/-, of which the Complainants have paid Rs. 31,80,000/-,
constituting nearly 50% of the total consideration. The Complainants have placed on record
evidence of such payments through receipts and bank statements.
10.

Despite the execution of the Agreement and substantial payment by the Complainants,

the Respondent has neither initiated development of the project nor obtained the requisite
statutory approvals. The Agreement expressly stipulated that the necessary permissions
would be procured within six months of execution; however, even after a lapse of over 3.5
years, there has been no commencement of development.
11.

The Complainants, citing this prolonged inaction, have sought to withdraw from the

project and have prayed for a refund of the amounts paid along with applicable interest.
13.

In order to determine whether the complainant is entitled to relief under Section 18 of

the Real Estate (Regulation and Development) Act, 2016 [“RE(R&D) Act”], it is imperative
to examine whether the provisions of Section 18, of the Act is applicable even in cases where
the project has not been registered with the Authority.
14.

The Preamble to the RE(R&D) Act underscores the legislative intent to establish a

regulatory authority for the regulation and promotion of the real estate sector, to ensure the
efficient and transparent sale of real estate, and above all, to protect the interests of
consumers in the sector. This legislative intent is pivotal to the interpretation of the scope of
the said Act.

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15.

Chapter I of the RE(R&D) Act, which provides for its application and scope, does not

circumscribe its operation to only registered projects. Section 3(1) of the said Act mandates
that no promoter shall advertise, market, book, sell, or offer for sale any plot, apartment, or
building without prior registration of the real estate project with the Authority. However,
Section 3(2) carves out certain exemptions from the requirement of registration. Notably,
these exemptions pertain only to the requirement of registration, and not to the substantive
obligations under the said Act.
16.

As per Section 2(zj), the term ‘project’ refers to a real estate project as defined under

Section 2(zn), which includes the development of land into plots for the purpose of selling,
inter alia. The definition is not contingent upon registration. Nowhere does the Act define a
‘real estate project’ as one that must be registered to fall within the ambit of regulatory
oversight. The consequence is that even unregistered but registrable projects fall within the
domain of the Regulatory Authority.
17.

In view of the above, it is well established that if a promoter undertakes activities as

defined under Section 2(zk) of the said Act without registering the project when such
registration was legally required the project would nevertheless fall within the domain of the
Authority. The Hon’ble Appellate Tribunal in M/s. Newtech Promoters and Developers Pvt.
Ltd. v. State of Uttar Pradesh &Ors., (2021 SCC OnLine SC 1044), observed that:
“The Authority has jurisdiction to entertain complaints pertaining to
refund, interest, or compensation under Sections 12, 14, 18, and 19 even in
the absence of registration, if such registration was otherwise required
under the Act.”
18.

Further, as per the definition under Section 2(zk), a ‘promoter’ includes a person who

develops land into a project for the purpose of selling. The Respondents, having developed
the land into plots and offered the same for sale, squarely fall within the ambit of the
definition and are thus liable for the obligations imposed on promoters under the said Act.
19.

Therefore, the relief sought by the Complainant for refund of the amount paid, along

with applicable interest under Section 18 of the Real Estate (Regulation and Development)
Act, 2016, is found to be legally tenable. As the Complainant has opted to withdraw from the
project which qualifies as a real estate project under the said Act and the Respondent as a
Promoter, he is entitled to interest to safeguard his rights, in view of the Promoter’s failure to
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fulfill their statutory obligations and inability to initiate development or deliver possession of
the allotted plots
20.

Attention is drawn to the decision of the Hon'ble Supreme Court of India in Civil

Appeal Nos. 3581-359 of 2022, Civil Appeal Diary No. 9796/2019, M/s Imperia Structures
Limited vs. Anil Patni & Others, wherein it was held:
"In terms of Section 18 of the RERA Act, if a promoter fails to complete or
is unable to give possession of an apartment by the date specified in the
agreement, the promoter would be liable, on demand, to return the
amount received in respect of that apartment if the allottee wishes to
withdraw from the project. Such a right of the allottee is 'without
prejudice to any other remedy available to him'. This right is unqualified,
and if availed, the deposited money must be refunded with interest as
prescribed. The proviso to Section 18(1) contemplates that if the allottee
does not intend to withdraw from the project, they are entitled to interest
for every month of delay until possession is handed over. The allottee may
proceed under Section 18(1) or the proviso thereto."
21.

Similarly, in Civil Appeal Nos. 6745-6749 of 2021, M/s Newtech Promoters and

Developers Private Limited vs. State of UP & Others, the Hon’ble Supreme Court observed:
"Section 18(1) of the Act spells out the consequences if the promoter
fails to complete or is unable to give possession of an 9 of 10
apartment, plot, or building in terms of the agreement for sale. The
allottee/home buyer holds an unqualified right to seek a refund of the
amount with interest as prescribed."
22.

Therefore, considering the aforementioned case laws and the provision of Section 18

of the RE(R&D) Act, this Authority is of the opinion that the Complainants, having invested
a substantial sum in anticipation of acquiring the allotted plots, has been wrongfully deprived
of their rights due to the Respondent’s absolute failure to execute the project. Consequently,
the Complainants are entitled to the relief sought, which includes a full refund of the amount
paid along with applicable interest.
23.

The Respondent is directed to refund the entire amount paid by the Complainant,

along with interest i.e Current Highest marginal cost of State Bank of India (9%) plus 2%
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that is 11% per annum, calculated from the date of the Memorandum of Understanding
(MOU) entered into with the Complainant until the date of actual
24.

Further, In the present matter, the Agreement of Sale placed on record by the

Complainant evidences that the Respondent had offered to sell plots in the project named
“Fortune99 Homes - Fortune Pharma City 1”. The Agreement itself records that approvals
were yet to be obtained and were expected within approximately six months. The brochure
submitted by the Complainant clearly represents the layout as a residential venture.
25.

It is evident from the clauses of the Agreement of Sale dated 11.08.2021 that the

Respondent had marketed and sold plots forming part of a real estate project without
obtaining prior registration from the competent Authority, despite the project exceeding the
statutory threshold of 500 square meters as stipulated under Section 3(2) of the Real Estate
(Regulation and Development) Act, 2016. Therefore, the Respondent was under a legal
obligation to obtain requisite approvals and register the project with this Authority prior to
executing the Agreement of Sale with the Complainant. The failure to do so constitutes a
clear violation of Sections 3 and 4 of the RE(R&D) Act, 2016.
26.

Further, despite repeated notices from the Authority which have been duly

acknowledged, the Respondents have failed to appear or furnish any explanation. This
conduct reflects gross negligence, lack of bona fides, and a clear disregard for regulatory
norms and consumer interests.
27.

Therefore, Respondent is liable for penalty under section 59 and 60 of the RE(R&D)

Act for the violation of section 3 and 4 of the said Act respectively.
28.

Accordingly Point 1 and 2 answered.

D. Directions of the Authority:
29.

Therefore, vide its powers under Sections 37 and 38, this Authority issues the following

directions to the Respondents:
i.

The Respondents are directed to refund the entire amount of Rs.56,80,000/- (Rupees Fifty
Six Lakhs Eighty Thousands Only) along with interest at the rate of 11% per annum (SBI
MCLR of 9.0% + 2%) from the date of the agreement of sale i.e., from 11.08.2021 till the

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date of actual refund in accordance with Rule 15 of the Rules, 2017 within 90 (ninety)
days to the Complainants;
For violation of Sections 3 and 4 i.e., for non-registration of the project – “Fortune99

i.

Homes”, the Respondent No.1 is liable for penalty under Sections 59 and 60 respectively,
therefore, the Respondent No.1 is directed to pay penalty of Rs.10,38,191/- (Rupees ten
lakhs thirty eight thousand one hundred and ninety one only) payable within 30 days in
favour of TGRERA FUND through a Demand Draft or online payment to A/c No.
50100595798191, HDFC Bank, IFSC Code: HDFC0007036;
ii.

The Respondents hereby is also directed to take steps to file an application for registration
of the project- “Fortune99 Homes” before this Authority in accordance with Section 4 of
the Act, 2016 and the Rules thereunder with immediate effect and till the registration is
granted by this Authority, the Respondents shall, strictly, not advertise, market, book, sell
or offer for sale, or invite person/s to purchase in any manner nay units of the said project,
“Fortune99 Homes”.
30.

Respondent is hereby informed that failure to comply with this order shall attract

Section 63 of the RE(R&D) Act.
31.

The complaint is disposed of with these directions. There shall be no order as to costs.

SdSri. K. Srinivas Rao,
Hon’ble Member
TG RERA

SdSri. Laxmi NaryanaJannu,
Hon’ble Member
TG RERA

SdDr. N. Satyanarayana, IAS (Retd.),
Hon’ble Chairperson
TG RERA

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