By Adv. Sulaiman Bhimani
Posted in Public Interest on www.thelawsuits.in

The Maharashtra Real Estate Appellate Tribunal, Mumbai, in a significant ruling dated June 19, 2025, has reinforced the rights of homebuyers under the Real Estate (Regulation and Development) Act, 2016 (RERA). In the matter of Bhoomi & Arkade Associates v. Mr. Vijay Menaria & Mrs. Premlata Menaria (Appeal No. AT006000000053367 of 2021), the Tribunal—comprising Member (Judicial) Shri Shriram R. Jagtap and Member (Administrative) Dr. K. Shivaji—upheld a refund order with interest and costs against the Promoter for failing to execute a statutory agreement for sale and delaying possession.

The Allottees were represented by Adv. Sharon Fernandes, with Adv. Sulaiman Bhimani (author of this article) also appeared on record for the complainants.

Background of the Case

The appeal arose from an order dated December 2, 2022, passed by the MahaRERA Authority in Complaint No. CC006000000057050, wherein the Promoter was directed to:

• • Refund ₹21,75,727/- with 9% simple interest per annum from the respective dates of receipt until repayment; and

• • Pay ₹20,000/- towards costs to the complainants.

The dispute stemmed from the booking of two flats (Nos. 1104 and 1105) in E-Wing of the project “Acropolis” on February 10, 2014. Subsequently, Flat No. 1104 was cancelled by the Allottees, and the earnest money was adjusted against Flat No. E-1105. An allotment letter was issued, and payments totaling ₹21,75,727/- were made up to June 2016, against the total consideration of ₹28,06,000/-.

Despite having accepted a substantial amount, the Promoter failed to execute a registered agreement for sale and missed the orally committed possession date of December 2017. Notably, the carpet area in the allotment letter (34.25 sq. mtrs.) did not match the figure on the MahaRERA website (31.24 sq. mtrs.).

Consequently, the Allottees opted to withdraw from the project and sought a full refund, compensation, and a forensic audit.

Promoter’s Defense

The Promoter contended that:

• • The complainants were speculative investors and not genuine allottees, having failed to pay the full consideration, stamp duty, and taxes;

• • In the absence of a registered agreement for sale, the Allottees could not claim relief under Sections 18(3) or 19(4) of RERA;

• • The project was substantially complete, and an Occupation Certificate (OC) was applied for;

• • As per the allotment letter, refunds were conditional upon resale to a third party;

• • They had already offered ₹19,92,260/- (after deducting cancellation and brokerage charges) since 2018, which the complainants refused.

The Promoter also claimed development delays were due to third-party issues (e.g., HDIL layout and MPCB clearance), not their own default.

Tribunal’s Analysis and Key Legal Findings

The Tribunal framed two key issues:

 

1. 1. Whether the impugned order required interference;

1. 1. What relief should be granted.

Execution of Agreement for Sale Is Mandatory

The Tribunal reaffirmed that under Sections 13 of RERA and Section 4 of MOFA, a promoter is legally obligated to execute and register an agreement for sale once 10%–20% of the consideration is received. Despite receiving ₹21,75,727/-, the Promoter failed to do so. Claims that the Allottees failed to pay stamp duty and registration charges lacked evidentiary backing, especially since records showed the Allottees were responsive to demands.

Delay in Possession and Verbal Commitment

While the OC was finally obtained on January 14, 2019, the Promoter had verbally committed possession by December 2017. The Tribunal noted that delays, even if linked to external agencies, are the Promoter’s responsibility.

Allottee’s Right to Exit

The Tribunal upheld the Allottees’ right to withdraw from the project due to the Promoter’s breach. The Promoter’s argument—that refunds are contingent upon resale to a third party—was rejected. RERA allows for refund claims under Section 18(1)(a) if possession is not given within the promised timeline.

No Agreement, Still Protection Under RERA

Importantly, the Tribunal emphasized that even in the absence of a registered agreement for sale, an allottee who has paid a substantial amount is entitled to seek relief under RERA for defaults by the Promoter.

Conclusion

The Appellate Tribunal dismissed the appeal filed by Bhoomi & Arkade Associates and upheld the original refund order. It further directed the Promoter to pay ₹10,000 as costs to the Allottees.

This ruling sends a strong message: RERA is a shield for genuine homebuyers, not just those with registered sale agreements. Developers cannot escape accountability for delays and defaults by hiding behind procedural excuses.

The decision reinforces that the intent and conduct of the Promoter, along with their adherence to statutory obligations, is central to determining the Allottee’s rights. This case is yet another reminder that consumer protection under RERA is real, effective, and enforceable.

Published in public interest by:
Adv. Sulaiman Bhimani
Citizens Justice Forum
The Law Suits
413, Golden Chambers, Opp. Tanishq Showroom,
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adv.bhimani@gmail.com
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