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The Telangana Real Estate Regulatory Authority (TGRERA) stepped in to protect homebuyer rights and issued an important order in favor of a buyer facing delayed delivery and broken promises; it is a telling indication of the authority being willing to level the fairness and accountability playing field in the real estate market.
Background of the Case
The case involved Purshottam Ketepally, a resident of Tarnaka, who lodged a complaint against a developer for booking a plot in an SV Golden City 5 project in LB Nagar. Ketepally first paid ₹1.08 lakh in October 2022 to book a plot, and later signed a sale agreement on December 7, 2022, after making an additional ₹4.09 lakh payment.
Problems arose when Ketepally found out that the plot he booked was mortgaged. The builder allegedly assured him that he would provide him an alternative plot, but Ketepally had to pay another ₹10 lakh. After several follow-ups, the plot was still not registered in Ketepally's name.
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TGRERA's Intervention
After looking into the case, Telangana RERA observed that the developer has failed to fulfill its contractual obligations to the complainant. The original plot and the alternate plot that was promised was still unregistered. The buyer simply received a raw deal. Given the complainant's efforts and cost, the authority ruled in the complainant's favour, under principles of equity.
RERA’s Directive to the Builder
The Telangana RERA orders the builder to offer an unencumbered plot to Ketepally in a period of 30 days. This offer specifies that the complainant must agree to take the plot in the same project. If the builder fails to offer the plot, the builder will have to refund ₹15.1 lakh amount, (i.e.), refund ₹15.1 lakh made with 11% per annum interest computed from the date of payment for each payment.
The authority also advised the builder of penalties under Section 63 of the Real Estate (Regulation and Development) Act, 2016, if the builder does not comply.
Significance of Telangana RERA’s Ruling
This ruling underscores the importance of Telangana RERA in safeguarding buyer interests. By enforcing strict compliance with contractual obligations, the authority ensures that developers are held accountable for delays and unfulfilled promises.
For buyers, the ruling demonstrates the effectiveness of seeking redress through regulatory mechanisms. It emphasizes the necessity of due diligence when engaging with real estate projects and highlights the avenues available for dispute resolution.
Legal Framework for Buyer Protection
The Real Estate (Regulation and Development) Act, 2016 is a major building block of buyer protection in India. The actions of the Telangana RERA are consistent with the Act's provisions to promote transparency, accountability, and timely delivery by real estate developers. The outcome of these provisions is a level playing field for buyers and builders alike, and built-in trust in the real estate sector.
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Conclusion
The Telangana RERA's order to the builder in SV Golden City 5 sends a clear signal to the real estate sector of the need to adhere to commitments. For buyers, it reinforces the importance of regulatory regimes that can protect their interests.
Such orders lead to a real estate sector that is better regulated and more transparent and equitable, which supports the practice of ethical and responsible conduct by builders and allows buyers to make wise choices. The Telangana RERA's effective handling of complaints further increases people's confidence in the regulatory system in the state and the real estate industry overall.
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Ans 1. The dispute involved Purshottam Ketepally, a buyer who paid ₹15.1 lakh for a plot in the SV Golden City 5 project. The builder failed to register the plot in his name and also did not deliver the alternate plot promised.
Ans 2. The Telangana RERA ordered the builder to either provide an unencumbered plot in the same project within 30 days or refund ₹15.1 lakh to Ketepally with 11% annual interest from the date of payment.
Ans 3. The builder faces potential penalties under Section 63 of the Real Estate (Regulation and Development) Act, 2016, if they fail to comply with the directive.
Ans 4. The ruling highlights the effectiveness of regulatory mechanisms like RERA in protecting buyer rights. It ensures accountability for developers and reassures buyers of their legal recourse in cases of delays or unfulfilled promises.
Ans 5. The Act provides a robust framework to promote transparency, accountability, and fairness in the real estate sector. It empowers buyers by enforcing compliance and penalizing errant developers.
Ans 6. Section 63 allows RERA authorities to impose penalties on developers for non-compliance with orders issued by the authority.
Ans 7. Buyers should conduct due diligence before investing in real estate projects and know their rights under RERA. Filing complaints through regulatory bodies like RERA can provide effective resolution mechanisms.
Ans 8. The ruling sends a strong message to developers about the importance of adhering to commitments and the consequences of non-compliance, fostering a more ethical and transparent real estate sector.
Ans 9. The 11% annual interest compensates the buyer for the financial loss incurred due to the delay, ensuring a fair remedy for the inconvenience and costs borne.
Ans 10. Buyers can file a formal complaint with their respective RERA authority, detailing the breach of contract or delay, and seek remedies as per the provisions of the Real Estate (Regulation and Development) Act, 2016.