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In a key ruling, the Maharashtra Real Estate Appellate Tribunal (MREAT) held that a developer cannot deny a homebuyer refund solely due to the absence of a registered sale agreement. The case involved a UAE-based NRI who booked an INR 84 lakh apartment in Panvel in 2013, paying INR 26 lakh. After construction delays, the buyer sought a refund under Section 18 of RERA. MahaRERA had dismissed the claim in 2020, citing no formal agreement. MREAT overturned this, recognising the 26-page booking form as a valid agreement reflecting mutual consent. The tribunal also noted the developer's non-compliance with Section 11(3) by not specifying possession dates. MREAT ordered a refund with interest, reinforcing that buyers' rights are protected beyond technical formalities. This ruling strengthens consumer protection and transparency in Maharashtra's real estate market.
As per a recent Maharashtra Real Estate Appellate Tribunal (MREAT) ruling a real estate developer cannot refuse a homebuyer a refund just because a formal sale agreement was not signed. This judgment overturns a previous order by the Maharashtra Real Estate Regulatory Authority (MahaRERA) from 2020. Advertisement
The case centers around a UAE-based Non-Resident Indian who, in 2013, booked an apartment in Panvel, near Mumbai, for INR 84 lakh. The buyer initially paid a booking amount of INR 1 lakh, followed by additional payments totaling INR 26 lakh. Due to construction delays, the buyer shifted the booking to another tower within the same project but did not receive possession even after five years.
Frustrated by the prolonged delay, the buyer sought a refund in May 2019 under Section 18 of the Real Estate (Regulation and Development) Act, 2016. However, MahaRERA dismissed the complaint in March 2020, stating that the absence of a registered sale agreement rendered Section 18 inapplicable. The authority directed both parties to execute and register the agreement within 30 days.
Challenging this decision, the buyer appealed to MREAT, which found that the detailed booking form, spanning 26 pages, outlined the mutual agreements between the parties and was akin to a sale agreement. The tribunal emphasized that the essence of the agreement lies in the intentions of the parties, not merely in the nomenclature of the document.
MREAT also highlighted that the developer violated Section 11(3) of the Act by failing to specify the possession date or stages of construction. Furthermore, the tribunal noted that there is no express provision in the Act allowing promoters to forfeit earnest or other payments upon booking cancellations.
Consequently, MREAT directed the developer to refund the INR 26 lakh paid by the buyer, along with applicable interest, reinforcing the principle that homebuyers' rights are protected even in the absence of a formal sale agreement.
It underscores the importance of the substance of agreements over their form, ensuring that homebuyers are not disadvantaged due to technicalities. The decision reinforces the regulatory framework's commitment to protecting consumer rights and promoting transparency and accountability in the real estate sector.
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