Booked Flat In 2017, Never Got Possession: MahaRera Directs Mumbai Builder To Refund Rs 1.4 Crore

MahaRERA orders Kalpataru Yashodhan promoters in Andheri West to refund over ₹1.40 crore plus interest to Hina and Sanjay Choksi for arbitrary forfeiture and RERA violations.

The Maharashtra Real Estate Regulatory Authority (MahaRERA) has directed the promoters of the Kalpataru Yashodhan project in Andheri West to refund over ₹1.40 crore, along with interest, to a homebuyer couple, after holding the developer guilty of arbitrary forfeiture and violation of the Real Estate (Regulation and Development) Act (RERA).

The refund has been ordered with interest calculated at the State Bank of India’s highest Marginal Cost of Lending Rate (MCLR) plus 2%.

The complainants, Hina and Sanjay Choksi, had booked a flat priced at over ₹7.12 crore in 2017 and paid approximately ₹1.46 crore, nearly 20% of the total price. The promoter had assured possession on or before December 2018. However, possession was never handed over.

According to the complaint, despite failing to meet the promised possession deadline, the promoter continued issuing demand letters from 2017 onwards. In February 2020, the developer forfeited the entire amount paid by the buyers and later sold the same flat to a third party.

The homebuyers were represented by advocate Dharmendra Damani.

Rejecting the promoter’s claim that the complainants were merely “investors” and not allottees, MahaRERA held that any person to whom an apartment is allotted for consideration qualifies as an “allottee” under RERA, irrespective of whether a registered agreement for sale has been executed. The authority said there was no evidence to support allegations of speculative intent or commercial resale by the complainants.

The regulator further observed that accepting more than 20% of the total consideration without executing an agreement for sale amounted to a statutory violation under Section 13 of RERA. The promoter, it said, cannot take advantage of its own breach by arguing that the absence of an agreement defeats the buyers’ claim.

In its order, MahaRERA member Ravindra Deshpande termed the forfeiture of the entire amount as arbitrary, disproportionate and illegal, particularly when the promoter itself was in breach of the law. The authority noted that the buyers were required to pay the remaining amount only after issuance of the occupation certificate, yet the promoter issued premature and unlawful demand letters.

The regulator also held that forfeiture exceeding 10% of the consideration, especially when the promoter is at fault, is unconscionable and violative of RERA. Once the flat was sold to a third party, the promoter could not legally retain the complainants’ money while also benefiting from the resale, MahaRERA said, terming the conduct as unjust enrichment.