Order Complaint No. 438 Of 2023

BEFORE TELANGANA REAL ESTATE REGULATORY AUTHORITY
[Under the Real Estate (Regulation and Development) Act, 2016]
COMPLAINT NO.438 OF 2023
11th day of July, 2024
Corum:

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

Sri Reddy Srinivas
…Complainant(s)
Versus
M/s V.V.Homes rep by Sri Narsingh Raju
…Respondent
The present matter filed by the Complainant herein came up for final
hearing on 27.02.2024 before this Authority in the presence of Complainant
present in person and Counsel B.Madhusudhan Reddy on behalf of the
Respondent and upon hearing the arguments of the parties, this Authority
passes the following ORDER:
2.

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

Estate (Regulation and 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
“Rules”) seeking directions from this Authority to take action against the
Respondent.
A. Brief Facts on behalf of the complainant:
3. The complainant entered into an agreement dated 16.12.2019 to
purchase a flat in plot no.22-22A, measuring 323.67 square yards, situated
in

ward

no.4,

Kamala

Nagar,

Boduppal

Village,

under

Boduppal

Municipality, Medipally Mandal, Mechal, Malkajgiri.

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4. The flat was priced at 3600 per square foot (1000 square feet), amounting
to 3,00,000/- (for amenities), with an advance payment of 5,00,000/- (five
lakhs only).
5. Pursuant to the agreement, the Respondent was obligated to complete
construction and hand over the property within 12 months from the
agreement's date.
B. Relief(s) Sought:
6. The complainant requests the appropriate authorities to take necessary
action against M/s V.V. Homes for their non-compliance with the
construction project and failure to deliver possession. The complainant
seeks a refund of Rs. 5,00,000/- along with accrued interest.
C. Hearing Conducted:
7.

On 11.10.2023, the complainant appeared in person, while no

representative appeared on behalf of the Respondent. The complainant
presented evidence of having purchased a flat from the Respondent, and as
possession was not delivered, sought a refund of the entire amount with
interest. The complainant was directed to serve a summons notice to the
Respondent for the next scheduled hearing on 02.11.2023. Subsequently,
on 02.11.2023, both the complainant and the Respondent appeared. The
Respondent's advocate filed a vakalatnama and requested time to file a
reply. On 31.01.2024, the Respondent requested further time to file a reply,
leading to the matter being adjourned to 27.02.2024, for filing a reply and
presenting oral submissions. However, on the last scheduled hearing date,
despite explicit directions from this Authority, the Respondent failed to
appear. The Complainant appeared and prayed to this Authority to grant the
reliefs as previously requested.
D. Points for consideration:
8.

On the above averments, the following point would arise for

consideration:

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1. Whether the complainant are entitled for the relief claimed?
9.

The grievance of the complainant is that they booked a flat on the 5th

floor of Plot No. 22, 22A, measuring 323.67 square meters, situated at Ward
No. 4, Kamla Nagar, in the respondent's project. The respondent was
required to hand over possession of the said flat within 12 months from the
date of the agreement of sale dated December 16, 2019. However, the
respondent has failed to deliver possession within the stipulated timeline,
thereby breaching the terms and conditions of the sale and construction
agreements dated December 16, 2019.
10.

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."

11.

The RERA Act thus provides a remedy to an allottee who wishes to

withdraw from the project or seek a return on their investment. Therefore,
as per Section 18(1) of the RE(R&D) Act, the promoter is liable to return the
amount received along with interest and compensation if the promoter fails
to complete or deliver possession of the apartment as per the sale
agreement.

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12.

Further, in the decision of the Hon'ble Supreme Court in Civil Appeal

Nos. 6745-6749 of 2021, M/s Newtech Promoters and Developers Private
Limited vs. State of UP & Others, it was held:
"Section 18(1) of the Act 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."
13.

From the averments made in the complaint, it is evident that the

complainant has paid a substantial amount as sale consideration and is
entitled to a refund along with interest. The complainant has claimed an
amount of Rs. 5,00,000/- paid, as acknowledged in the sale agreement and
payment receipts of the respondent for the concerned unit. The respondent
has not submitted any reply despite several opportunities.
14.

Therefore, it is incumbent upon the respondent to refund the amount

owed to the complainant along with interest at 10.65% per annum, as per
Rule 15 of the Telangana Real Estate (Regulation and Development) Rules
(TG RE(R&D) Rules), which stipulates the Marginal Cost of Lending Rate
(MCLR) plus 2%. The current MCLR of the State Bank is 8.65%, plus 2%
from the due date, i.e., December 17, 2020.
15.

Despite being served notices, the respondent's counsel filed a

vakalatnama but did not appear before this Authority and remained absent
on all hearing dates. Consequently, the respondent failed to file a statement
of objections or furnish supporting documents for their defense, thus not
contesting the matter. In the absence of any resistance by the respondent
and considering the claim of the complainant corroborated by documentary
evidence, this Authority has no option but to accept the claim of the
complainant.
16.

Considering all these aspects, the point raised above is answered in

the affirmative.

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E. Directions of the Authority:
17.

The Authority hereby issues the following directions under Section 37

of the Act to ensure compliance with the obligations entrusted to this
Authority under Section 34(f):
1. The respondent is directed to pay a sum of Rs. 5,00,000/- (Rupees
Five Lakhs only) to the complainant.
2. The respondent shall also pay interest at the rate of 10.65% per
annum, calculated at the State Bank of India's Marginal Cost of
Lending Rate (MCLR) plus 2%, from December 17, 2020, until the
date of realization.
3. This payment must be made within 60 days from the date of this
order.
18.

In light of the above-mentioned directions, the present complaint

stands disposed of. If the Respondent Builder fails to comply with this
Order, appropriate action, including the imposition of a penalty, will be
taken as per the provisions under Section 63 of the Act, 2016.
19.

If aggrieved by this Order, the parties may approach the TS Real

Estate Appellate Tribunal (vide G.O.Ms.No.8, dated January 11, 2018, the
Telangana State Value Added Tax Appellate Tribunal has been designated as
TS Real Estate Appellate Tribunal to manage affairs under the Act until the
regular Tribunal is established) as per Section 44 of the Act, 2016.

Sd/-

Sd/-

Sd/-

Sri. K. Srinivas Rao,

Sri. Laxmi NaryanaJannu,
Hon’ble Member

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

TG RERA

TG RERA

Hon’ble Member
TG RERA

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