Landmark judgment reinforces the overriding effect of RERA provisions, granting allottees an indefeasible right to compensation despite contractual clauses.
In a significant ruling, the Bombay High Court has dismissed the appeal filed by Kiyana Estate LLP, thereby affirming the rights of property allottees under the Real Estate (Regulation and Development) Act, 2016 (RERA). The court upheld the Maharashtra Real Estate Appellate Tribunal's decision, which directed Kiyana Estate LLP to refund Rs. 29,10,000 along with accrued interest to the allottees due to delayed possession of flats.
Presided over by Justice N. J. Jamadar, the court emphasized the unqualified right of allottees under Section 18(1) of RERA to claim interest or a refund for delays in possession. The court reiterated that RERA provisions hold an overriding effect over any other law in force, as articulated in Section 89 of the Act. This judgment reinforces RERA's role as a beneficial legislation aimed at protecting the interests of property buyers.
The dispute arose when Kiyana Estate LLP failed to fulfill the conditions attached to the Occupancy Certificate (O.C.) for the concerned project, particularly the requirement of ensuring adequate water supply before handing over possession. Despite receiving the O.C., the possession was not delivered in a habitable condition, prompting the allottees to seek compensation.
Kiyana Estate LLP contended that the allottees were not entitled to compensation due to their acceptance of possession without prior notice of claim for compensation, as per Section 55 of the Indian Contract Act, 1872. However, the court rejected this argument, citing the non-obstante clause in Section 89 of RERA, which grants precedence to RERA provisions over other laws.
The court further supported its decision by referencing the Supreme Court rulings in the cases of "M/s Newtech Promoters and Developers Pvt Ltd v. State of U.P." and "Imperia Structures Ltd. v. Anil Patni," which affirm the allottees' rights to refunds and interest under RERA for non-compliance by promoters.
In conclusion, the court found no substantial question of law warranting further consideration and thus dismissed the appeal, along with the connected interim application. This judgment serves as a crucial precedent reinforcing the protective framework for homebuyers under RERA, ensuring accountability and transparency in real estate transactions.
Bottom line:-
The provisions of the Real Estate (Regulation and Development) Act, 2016 (RERA) have an overriding effect over other laws, and Section 18(1) of the Act confers an indefeasible and unqualified right upon an allottee to claim interest or refund for delayed possession as per the agreement.
Statutory provision(s): Real Estate (Regulation and Development) Act, 2016 Sections 18(1), 89; Indian Contract Act, 1872 Section 55
Kiyana Estate LLP v. Tina Dharamshey, (Bombay) : Law Finder Doc id # 2960880
