Enforcing MAHARera Orders: Bombay High Court Sets 15-Day Deadline for Selling Builder’s Property in Case of Settlement Failure.

The Bombay High Court has ordered swift action against revenue authorities who neglected to enforce MahaRERA orders favoring a flat purchaser. They directed that if settlement discussions prove fruitless, the builder's property should be attached and sold within just 15 days.

A division bench of Justices SV Gangapurwala and MG Sewlikar said,

“If within a period of two months settlement between Petitioner and Respondent Nos.5 to 8 is not arrived at then immediately within 15 days the Tahasildar/Competent Revenue Authority shall execute the recovery warrant as per the provisions of Maharashtra Land Revenue Code by attaching and selling the property of the Respondents.”

The bench emphasized the significance of the Authority’s diligence, explicitly stating that there should be no “laxity on the part of the Authority in executing the said recovery certificates” under MahaRERA. This process involves selling a builder’s properties to compensate a flat purchaser and is considered the final recourse for the flat buyer to recover their funds.

The court was addressing a series of petitions filed by original flat purchasers against both the developer and revenue authorities. Among these petitioners was Ansari Zaki, who initially sought a refund of the partial payment made for his 710 sq. ft. flat in Malad through MAHARera. This request stemmed from the builder’s failure to obtain permissions for commencing development within a significant timeframe.

On June 18, 2019, MAHARera directed the builder to refund an amount exceeding Rs. 27 lakhs, along with 10.75% simple interest. In September, MAHARera issued a Recovery Warrant under section 40(1) of the Rera Act, amounting to over Rs. 40 lakhs, which included the interest component.

Zaki, along with several others in a similar situation, approached the High Court, asserting that the orders remained unexecuted.

The petitioners claimed, “The grievance is made that the orders passed by MahaRERA, Mumbai are not being executed by the Revenue Authorities.”

The builder, Vidhi Realtors claimed that they has entered into several settlement agreements and could do the same with the petitioners and they would accordingly make payments in instalments.

However, the court ordered that if the parties failed to arrive at a settlement within two months, the Tehsildar or whoever is the competent authority must dispose of the builders assets to pay off the flat purchasers.

Posted and reproduced in Public Interest by

Adv. Sulaiman Bhimani Legal Consultant

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