U.P. RERA recently passed a combined order in 19 complaint cases against ATS Realty Pvt. Ltd. concerning their project - "ATS Allure" and the homebuyers have all the more reasons to celebrate. Single order was passed for all 19 cases which were heard together owing to the fact that all 19 cases were based on similar facts and would thereby lead to similar results.
Through the Order dated 24.02.2023 (uploaded on 22.03.2023) passed by UP RERA mainly two issues were decided. The two issues being –
Whether it was because of ‘Force Majeure' that the Respondent's project could not be completed in time?
Whether the Complainants have the right to "Delay Interest" for the delay caused by the Respondents in handing over the possession?
While deciding the first issue it was contended by the Respondent builder that a writ petition is pending in the Hon’ble High Court of Allahabad which was also one of the reasons for the delay of the project except ‘force majeure events’. However, it was observed that the Respondents did not place on record any documentary evidence in support of their claim that the project was delayed because of any force majeure events.
Reliance was placed on Civil Appeal No. - 940/2017 - Vikram Chatterjee & Anr. V UOI & Ors., wherein force majeure was defined as “force majeure shall mean a case of war, flood, drought, fire, cyclone, earthquake or any other calamity caused by nature.” On the basis of the said definition, it was observed that no such 'force majeure' situation has been faced by the Respondent builder which will qualify them to claim any benefit on the same ground. However, the learned Authority was of the opinion that looking at the present situation, it would be appropriate to consider a total of 9 months time during COVID-19 in the category of 'Force Majure' events.
With regard to the second issue, it was the Complainant’s case that since he has not been given possession of the allotted unit, the Respondent Builder is liable to pay him Delay Interest Penalty until possession is given to him.
Further, the Complainants placed on record their Builder-Buyer Agreements according to which it was clear that the project has been delayed, and the situation warrants that delay interest penalty should be paid to the Complainants from the date of allotment till the date when either the O.C/C.C. is obtained by the Respondent builder, or, the possession is given to them, whichever happens later. While the learned authority had mentioned the factual position of only Complainant No. 1 in the said order, however, they made clear that computation of delay penalty shall be made respectively in case of each complainant in accordance to their individual Builder-Buyer Agreements (BBA).
As far as the rate of interest is concerned, the learned Authority referred to Real Estate (Regulatory and Development)(Agreement for Sale/Lease) Rules, 2018 notified by the State Government under the Real Estate (Regulatory and Development) Act, 2016. According to Clause 9.2(i) of the said Rules, consequence of event of default by the promoter have been laid down by virtue of which an Allottee is entitled to terminate the agreement in which case the promotor will have to refund the entire amount of money paid by the Allottee towards the purchase of the apartment along with interest at the rate equal to MCLR (Marginal Cost of Lending Rate) on home loan of State Bank of India + 1% within 45 days of receiving the termination notice.
Further, the question as to till what date the interest is to be given was decided on the basis of Civil Appeal No. 6649-50/2018 Supertech Ltd. V Rajni Goyal according to which the interest is to be paid up to the date till the O.C./C.C. is obtained, or, the possession is given, whichever comes later. Thus, the delay interest penalty shall be paid by the Respondent builder from the date of default given in the BBA of each individual complainant till the date when O.C./C.C. is obtained or the possession is given, whichever comes later. Although, a period of 6 months from 25.03.2020 to 25.09.2020 during the COVID-19 First Wave, and further, a period of 3 months from April 2021 to June 2021 during the COVID-19 Second Wave, thus, a total period of 9 Months was considered as 'force majeure' by the U.P. RERA and the same is excluded in order to calculate the said delay interest penalty.
Thus, the order can be summarised as follows-
The Respondent is directed to give complete possession of the allotted units to the complainants latest within 60 days of the date of upload of the order along with O.C./C.C.
The Respondent shall be liable to pay the delay interest penalty at the rate of MCLR + 1% from the date of default given in the BBA of each individual complainant till the date when O.C./C.C. is obtained or the possession is given, whichever comes later. This amount shall be adjusted in the final demand, if any, to paid by the allottee, otherwise, if there are no such dues left, the same shall be refunded back to the allottee.
The period of 6 months from 25.03.2020 to 25.09.2020 during COVID-19 First Wave, and further, the period of 3 months from April 2021 to June 2021 during COVID-19 Second Wave, thus, a total period of 9 Months shall be excluded for the purpose of calculating the delay interest penalty.
The Respondent cannot demand any other charges from the allottees while handing over the possession.
The offer of possession has be given along with O.C./C.C.
In case the Promoter/Respondent fails to comply with the said order, then the same shall be punishable under Section 63 of RERA Act, read with other suitable provisions. Moreover, the Complainant can approach RERA again in order to ensure execution of the said order.
The complaints on behalf of the allottees in the following order were filed and argued by S&D Legal Associates in association with its Partners and Associates based in Delhi/NCR.
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