Order Complaint No. 248 of 2024

BEFORE TELANGANA REAL ESTATE REGULATORY AUTHORITY
[Under the Real Estate (Regulation and Development) Act, 2016]
Complaint No. 248 of 2024
29th September 2025
Quorum:

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

1. Sumit Kumar Soni.
R/o- Plot No.297 TNGO’s Colony
Near Q City Building and Wipro Circle Gachibowli
Hyderabad- 500032

2. Ranjana Bansal
R/o- Plot No.297 TNGO’s Colony
Near Q City Building and Wipro Circle Gachibowli
Hyderabad- 500032

…Complainant(s)

AND
Jayathri Infrastructures Pvt Ltd. Rep. by Kakarla Srinivas
141, 1st Floor, Eminent Plaza, Plot No. 140, KPHB 6 th Phase Rd
Kukatpally Housing Board Colony
Kukatpally Hyderabad,
Telangana 500081

…Respondent

The present matter filed by the Complainants herein came up for hearing before this
Authority in the presence of and Complainants in person, none appeared on behalf of the
Respondent despite service of notice, and therefore he was set ex-parte, and after hearing the
Complainants, this Authority passes the following ORDER:
2.

The present Complaint has been filed by the Complainants 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 Respondent.
A. Brief Facts of the Case:
3.

The complainants submitted that on 19.10.2020, they came across an online advertisement

published by the Respondent on Facebook, promoting a proposed residential and commercial
project under the name “SKY EXOTIC”, situated at Gopanpally.
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The complainants further stated that on 22.10.2020, one Mr. Vinay Reddy, an executive of

the Respondent company, personally visited their residence and provided detailed information
regarding the proposed project, including its location, amenities, and unit options.
5.

It was submitted that the complainants, relying on the representations made, proceeded to

book a 3BHK unit in the said project on 01.11.2020, and in doing so, paid a token amount of
Rs.5,00,000/-. The payment receipts for this amount were duly signed by Mr. Bolla Srinivas Rao,
who has been identified as Respondent No. 2 in the present matter.
6.

The complainants highlighted that on 21.12.2020, they made an additional payment of

Rs.25,00,000/- to the Respondent company. Out of this, Rs.13,00,000/- was paid by cheque, and
the remaining Rs.12,00,000/- was handed over in cash. No construction activity or formal
allotment followed despite the substantial payments made.
7.

It was further stated that on 26.04.2023, during a personal meeting with Mr. Kakarla

Srinivas and other directors of the Respondent company, the complainants were assured that the
amounts collected from them, along with applicable interest, would be refunded within two
months. The directors informed the complainants that the project could not be initiated due to
financial constraints faced by the company.
8.

The complainants also submitted that on 24.08.2024, they met Mr. Hari Prasad, another

director of the Respondent company. However, Mr. Hari Prasad informed them that he was no
longer associated with the company and expressed his inability to offer any assistance regarding
the refund or the status of the project.
9.

The complainants emphasized that, to date, they have paid a total sum of Rs.30,00,000/- to

the Respondent. However, there has been no refund, no construction activity, and no allotment of
any unit in the “SKY EXOTIC” project, despite repeated assurances and follow-ups with the
Respondent.
B. Relief(s) Sought:
10.

Aggrieved by the acts of the Respondent, the Complainants pray for the following:

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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 Respondent has violated Sections 3 and 4 of the Real Estate (Regulation and
Development) Act, 2016, by failing to register the Gopanpally project - “Sky Exotica”
with this Authority? If so, whether the Respondent is liable to be penalized for such
violation?

II.

Whether the Complainants are entitled to the reliefs as prayed for? If yes, to what extent?

D. Observation of the Authority
POINT I

12.

This Authority has perused the pleadings, documents, and submissions on record. It is

noted that notice of the proceedings was issued to the Respondent but returned unserved reason
stating “no such person at this address”. In adherence to the principles of natural justice, the
Complainants were directed to effect personal service, and they complied by serving notice
through electronic means and providing proof. Further directions for substitute service were also
duly complied with.
13.

Despite service of notice, including a Show Cause Notice specifically concerning the

Gopanpally project “Sky Exotica,” the Respondent neither appeared nor filed any reply. No
explanation for such continued absence was provided. Accordingly, the Respondent was
proceeded against ex parte, and the matter was adjudicated based on the available material from
the Complainants.
14.

Having thus established the Respondent’s continued non-participation, this Authority now

proceeds to examine the core issue namely, whether the Respondent has contravened the
mandatory registration requirement under Section 3 of the Real Estate (Regulation and
Development) Act, 2016. Section 3(1) of the Real Estate (Regulation and Development) Act, 2016,
imposes a categorical bar against any promoter advertising, marketing, booking, selling, or
offering for sale any plot, apartment, or building in a real estate project without prior registration
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The only statutory exemption to the mandate under Section 3(1) is provided in Section 3(2)

of the RE(R&D) Act, 2016, which exempts projects where the land proposed to be developed does
not exceed 500 square meters or the number of apartments does not exceed eight. However, in the
present case, the documentary evidence on record clearly establishes that the proposed project was
to be developed over 9.25 acres, which equates to approximately 37,433.42 square meters.
Therefore, the said project squarely falls within the scope of Section 3(1) and is not exempted
under Section 3(2) of the RE(R&D) Act, 2016. Consequently, registration with the Authority was
a mandatory pre-condition before any form of advertisement, agreement, or collection of funds
could take place.
16.

In the present matter, a careful scrutiny of the material on record shows that the Respondent

advertised and marketed the project under a so-called “pre-launch” offer, without obtaining
requisite registration or approvals as mandated by the Act. It is further evidenced that the
Respondent entered into a Memorandum of Understanding dated 21.12.2020 with the
Complainants and collected a sum of Rs.30,00,000/- (Rupees Thirty Lakhs only) towards part of
the total sale consideration amounting to Rs.61,71,000/- (Rupees Sixty-One Lakhs Seventy-One
Thousand only).
17.

Engaging in commercial activities of advertising, soliciting bookings, executing

agreements, and receiving substantial consideration from allottees without registration constitutes
a clear and wilful contravention of Section 3(1) of the RE(R&D) Act, 2016. The Respondent’s
actions, as demonstrated by the undisputed documents and pleadings, are in direct violation of the
transparency and accountability framework mandated by the statute.
18.

Accordingly, in light of the documentary evidence, the duly issued and served Show Cause

Notice, and the Respondent’s failure to furnish any rebuttal or justification, this Authority is

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This Authority further takes judicial notice of the fact that the Respondent company,

Jayathri Infrastructures Pvt Ltd. has already been declared a defaulter in Complaint Case No. 1269

of 2023 and connected batch matters before this Authority. It is pertinent to observe that not only
has the company been held guilty of persistent defaults, but even its managing director, Mr.
Kakarla Srinivas, has been individually declared a defaulter in his personal capacity in Complaint
No.113 & 247 of 2024. Such repeated findings against both the company and its key managerial
person demonstrate a consistent pattern of non-compliance and wilful disregard of the statutory
framework under the Real Estate (Regulation and Development) Act, 2016.
20.

The repeated declaration of default, both against the Respondent company and its

managing director, clearly reflects the extent of their dubious practices and inability to either
deliver projects or honour commitments made to allottees. This Authority is constrained to observe
that the Respondent’s conduct is not an isolated lapse in the present case but rather a continuing
modus operandi, which undermines the very objectives of transparency, accountability, and
consumer protection envisaged under the RE(R&D) Act, 2016. Such a history of default reinforces
the seriousness of the present violation and calls for strict regulatory intervention.
Point II.
21.

As the Complainants have specifically sought a refund of the amount paid, this Authority

has carefully examined the obligations of the Respondent under the contractual Memorandum of
Understanding (MoU) as well as the statutory framework under the Real Estate (Regulation and
Development) Act, 2016.
22.

The record clearly establishes that the Respondent failed to fulfil both its contractual and

legal obligations. Despite executing an MoU dated 21.12.2020 and receiving a substantial sum of
Rs.30,00,000/- (Rupees Thirty Lakhs Only) from the Complainants towards the Gopanpally
project titled “Sky Exotica,” the Respondent has not demonstrated any progress on the project.

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The Complainants have submitted that they made several attempts to contact the

Respondent to seek updates regarding the status of the project. However, all such attempts proved
unsuccessful.
24.

It is further submitted that there is no identifiable or functional office of the Respondent at

any known location. The Complainants were unable to locate the Respondent or establish any line
of communication. Even after service of notice, the Respondent neither appeared before this
Authority nor filed any reply. The Respondent has also failed to communicate or disclose the
current stage of construction, thereby evading all responsibility and accountability.
25.

In light of the above facts including the Respondent's failure to perform under the MoU,

absence of developmental activity, inability to update the Complainants regarding the current
status of the project, the Complainants were constrained to file the present complaint seeking
refund of the amount paid along with appropriate reliefs under the Act.
26.

The Respondent’s failure to commence any development activity, coupled with the absence

of communication and non-compliance with the RE(R&D) Act, 2016, constitutes a fundamental
breach of its obligations under the said Act. It is further submitted that, on multiple occasions, the
Respondent had assured the Complainants that the amount paid would be refunded; however,
despite such repeated assurances, no refund was made. This continued inaction and failure to
honour express commitments clearly establish the Respondent’s default, both in terms of
contractual obligations and the statutory provisions of the RE(R&D) At, 2016.
27.

In these circumstances, the Complainants’ claim for refund is not only factually justified

due to the complete inaction and failure of the Respondent to refund the amount despite repeated
assurances, but is also legally sustainable under the Real Estate (Regulation and Development)
Act, 2016. The failure to execute or proceed with the project, coupled with the failure to refund
the amount received, squarely attracts the consequences contemplated under Section 18(1) of the
Act.
28.

Section 18(1) of the Real Estate (Regulation and Development) Act, 2016 provides a

statutory remedy to the allottee in cases where the promoter fails to complete or is unable to give
possession in accordance with the agreed terms. The provision confers an unqualified right on the
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The Hon’ble Supreme Court, while interpreting Section 18(1), has laid down clear

principles reinforcing the allottee’s statutory right. In Civil Appeal Nos. 3581–359 of 2022, Civil
Appeal Diary No. 9796/2019, M/s Imperia Structures Limited vs. Anil Patni & Others, 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."
30.
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 held:
"Section 18(1) of the RE(R&D) Act, 2016 spells out the
consequences if the promoter fails to complete or is unable to
give possession of an 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."

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In addition to the legal defaults, this Authority takes notice of the Respondent’s own

declaration via circular dated 14.04.2023, wherein it was stated that customer refunds would be
processed within 3-6 months. However, this self-imposed timeline has remained unfulfilled.
32.

Therefore, upon careful consideration of the statutory provisions, judicial precedents, and

factual record, this Authority concludes that the Complainants having invested a substantial sum
in good faith and in expectation of acquiring the allotted space have been wrongfully deprived of
their rights due to the Respondent’s absolute failure to initiate or complete the project. The
Respondent’s conduct, including deceptive practices in other projects, further reflects a pattern of
willful default and regulatory evasion.
33.

The Complainants have however sought for refund of the amount along with interest rate

mentioned in the Memorandum of Understanding dated 21.12.2020. The interest rate for the refund
will be governed strictly in accordance with the Telangana RE(R&D) Rules, 2017. Hence, Point
No. II answers in affirmative.
34.

In light of the above, this Authority, exercising its powers under Sections 37 and 38 of the

RE(R&D) Act, 2016, holds that the Complainants are entitled to refund along with interest in
accordance with Rule 15 of the TG RE (R&D) Rules, 2017, which prescribes interest at the rate
of State Bank of India’s highest Marginal Cost of Lending Rate (MCLR) plus 2%.
35.

Accordingly, the Respondent is hereby directed to refund the entire amount of

Rs.30,00,000/- (Rupees Thirty Lakhs Only) paid by the Complainants, along with interest at the
rate of 10.75% per annum (i.e., current MCLR of 8.75% plus 2%), computed from the date of the
Memorandum of Understanding dated 21.12.2020 until the date of actual realization. The entire
amount, along with accrued interest, shall be refunded within 90 days from the date of this order.
E. Directions of the Authority:
36.

In light of the findings of the Authority as recorded above, the following directions are

issued under Section 37 of the RE(R&D) Act to ensure compliance with the obligations imposed
upon the promoter as per the functions entrusted to the Authority under Section 34(f) of the
RE(R&D) Act:

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The Respondent is directed to refund the entire amount paid by the complainants
for the unit in the project "Sky Exotica" as mentioned above, along with interest of
10.8% per annum from the date of the Memorandum of Understanding (MOU)
entered into with complainants, until the date of actual realization.

ii.

The refund of the entire amount shall be paid by the Respondent to the complainants
within a period of 90 days from the date of this Order.

iii.

For contravening Section 3 of the RE (R&D) Act, 2016 this Authority, exercising
its powers under Section 59 of the RE (R&D) Act, 2016 imposes a penalty of
Rs. 18,35,000/- (Eighteen lakhs thirty-five thousand). This penalty is imposed for
marketing/selling flats of the Project without registering the project before this
Authority. The amount is payable in favor of TGRERA FUND through a Demand
Draft or online payment to A/c No. 50100595798191, HDFC Bank, IFSC Code:
HDFC0007036,

within

30

days

of

receipt

of

this

Order

by

the

Respondent/Promoter.
37.

Failure to comply with this Order shall attract Section 63 of the RE(R&D) Act, 2016.

38.

In light of the above findings and directions, the present complaint stands disposed of.

Sd/Sri K. Srinivasa Rao,
Hon'ble Member,
TG RERA

Sd/Sri Laxmi Narayana Jannu,
Hon'ble Member,
TG RERA

Sd/Dr. N. Satyanarayana, IAS (Retd.),
Hon'ble Chairperson,
TG RERA

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