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Writer's pictureUtkarsh Shubham

UPRERA Ruling: Homebuyers Triumph as Developer Faces Penalties for Delays [Read Order]

Updated: Jul 25


UPRERA Ruling: Homebuyers Triumph as Developer Faces Penalties for Delays

The Battle Against Delayed Possession: A Win for Homeowners

Have you ever felt helpless waiting for your dream home to be completed? Well, here's some good news that might restore your faith in the system! In a recent groundbreaking judgment, the Uttar Pradesh Real Estate Regulatory Authority (UPRERA) has taken a strong stand in favor of homebuyers. This ruling sends a clear message to developers: delays in project completion will not be tolerated.


In a recent landmark ruling, the Uttar Pradesh Real Estate Regulatory Authority (UPRERA) has directed M/s Hebe Infrastructure Pvt. Ltd. (Mahagun Group) to compensate homebuyers for causing delay in handing over possession of their allotted units. The case, Ankit Jain & others. v. M/s Hebe Infrastructure Pvt. Ltd. (NCR144/03/107082/2023 - Leading Complaint), highlights the rights of homebuyers and the accountability of developers under the Real Estate (Regulation and Development) Act, 2016 (RERA).


Background: Understanding the Dispute

Homebuyers had filed their complaints under Section 31 read with Section 37 of the RERA Act, alleging that the developer failed to deliver possession of units in the “Mahagun Mantra II” project on time. Additionally, they argued that an offer of possession was made without obtaining the necessary Occupation Certificate/Completion Certificate (OC/CC), a violation of Section 17 of the RERA Act.


In defense, the developer cited force majeure events, such as COVID-19 and downturns in the real estate market, as reasons for the delay. They claimed that a "deemed" OC/CC had been obtained and that buyers were obligated to take possession and complete their payments.


Key Issues Addressed by UPRERA

UPRERA focused on three critical issues in this case:


  1. Force Majeure Claims: Was the project delay justifiable under force majeure?

  2. Validity of Possession Offers: Can possession be legally offered without a valid OC/CC?

  3. Compensation for Delay: Are the complainants entitled to compensation for the delay, and at what interest rate?


UPRERA's Findings and Observations

After a thorough analysis, UPRERA made several significant observations:


  1. The developer had not obtained a valid OC/CC.

  2. The offer of possession made on 14.02.2023 was invalid without the proper OC/CC.

  3. A 68-day delay was attributable to a Supreme Court construction ban.

  4. The document provided as an Electrical NOC was merely an approval for transformer installation, not a proper NOC.

  5. A dispute over dues with the Greater Noida Authority was delaying the OC issuance.

  6. The COVID-19 pandemic was acknowledged as a force majeure event affecting the project's timeline.


UPRERA Ruling: A Win for Homebuyers

UPRERA's verdict provided comprehensive relief to the homebuyers:


  1. Completion and Possession: The developer must complete all unit facilities, obtain the proper OC/CC, and provide physical possession to the complainants.

  2. Delay Interest Payment: The complainants shall receive interest from the promised possession date (plus 68 days attributable to a Supreme Court construction ban) until the date of obtaining the OC/CC or a valid possession offer letter, whichever is later. The interest rate is set at MCLR+1% on the deposited amount.

  3. Force Majeure Exclusion: No interest will be charged for the force majeure period from 25.03.2020 to 25.09.2020 due to COVID-19 pandemic.

  4. Uniform Interest Rate: If the developer charged a higher interest rate from allottees for their defaults, the same rate applies to the developer's defaults.


Conclusion: Balancing Interests and Ensuring Compliance

This ruling underscores UPRERA's commitment to protecting homebuyers' rights while acknowledging developers' challenges. By invalidating unauthorized possession offers and mandating interest payments for delays, UPRERA reinforces the importance of regulatory compliance. The fair interest rate calculations and consideration of COVID-19 impacts further demonstrate a balanced approach to compensating homebuyers.


For developers, this decision serves as a critical reminder to adhere strictly to promised timelines and regulatory requirements, ensuring transparent and fair practices in the real estate sector.


What Does This Mean for You?

This ruling is a significant victory for homebuyers across Uttar Pradesh and potentially sets a precedent for the rest of India. It reinforces your rights as a homebuyer and holds developers accountable for their commitments.


If you're currently waiting for possession of your property or facing similar issues with developers, this judgment could be relevant to your situation. It's a reminder that the law is on your side when it comes to fair treatment in real estate transactions.


What's Next?

Are you facing delays or issues with your real estate purchase? Don't hesitate to reach out. Our experienced team at S&D Legal Associates is here to help you navigate the complex world of real estate law and ensure that your rights are protected.


Remember, knowledge is power. Stay informed about your rights as a homebuyer, and don't hesitate to seek expert legal advice when needed. Together, we can work towards a fair and transparent real estate sector that benefits everyone.


Have you had similar experiences with delayed possession? We'd love to hear your thoughts in the comments below!


 

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