The Uttar Pradesh Real Estate Appellate Tribunal, Lucknow, has allowed an appeal filed by homebuyer and set aside a 2017 order of the U.P. Real Estate Regulatory Authority (RERA), holding that the project in question was delayed and that the allottee was entitled to statutory delay interest till a valid offer of possession was made.
A Bench comprising Judicial Member Sanjai Khare and Administrative Member Rameshwar Singh was hearing an Appeal filed under Section 44 of the Real Estate (Regulation and Development) Act, 2016, challenging the RERA Authority’s order dated 20 November 2017 passed in a complaint against M/s S.V.P. Builders India Pvt. Ltd.
The dispute arose from a flat jointly booked by the appellant and his wife in the “Gulmohar Garden Phase-II” project at Raj Nagar Extension, Ghaziabad, in February 2012. As per the agreement and the tripartite arrangement with ICICI Bank, possession was assured by 24 September 2014. However, the builder failed to complete the project within the stipulated time and continued to raise demands despite the delay. The appellant alleged that the builder also constructed an additional floor, depriving him of the top-floor flat for which preferential location charges had been paid.
The Tribunal held that the assured date of possession was 24 September 2014 and rejected the builder’s reliance on contractual clauses extending the construction timeline, observing that such clauses were contrary to Section 4(5) of the U.P. Apartment Act, 2010. It further noted that the project was not completed within the assured period and that even the partial completion certificate was issued only on 6 July 2018, clearly establishing delay.
On the validity of possession offers, the Tribunal ruled that offers made without obtaining the requisite Occupancy/Completion Certificate were invalid in law. It held that a valid offer of possession was made only on 27 November 2019, when the builder finally offered a flat on the actual top floor (14th floor) after constructing an additional storey, thereby entitling the allottee to delay interest up to that date.
Setting aside the RERA Authority’s order as “illegal and perverse”, the Tribunal directed the builder to pay delay interest at the rate of MCLR + 1% on the deposited amount for the period from 25 September 2014 to 27 November 2019. The builder was also directed to issue a fresh statement of account, adjust the delay interest payable, and execute the conveyance deed while handing over possession of the top-floor flat to the allottee within 45 days
However, the Tribunal clarified that since the allottee had chosen to remain in the project and had not sought withdrawal, he was not entitled to separate compensation for bank EMIs or rent paid during the delay period, in line with Section 18 of the RERA Act and the Supreme Court’s ruling in Newtech Promoters & Developers Pvt. Ltd. v. State of U.P.
Appearances:
For Appellants: Ritiwick Rai, Advocate Vaibhav tiwari, Advocate, Palash Banerjee, Advocate, Aviral Raj Singh, Advocate, Ashutosh Verma, Advocate
For Respondents: Mr. Azhar Ikram
