Seek refund if alterations in real estate project plan affect you

You can ask for your money from the developer even if you had earlier given consent to alterations

The National Consumer Disputes Redressed Commission (NCDRC) has ordered a hefty refund Rs 33 Crore, along with 12 percent interest, to three flat buyers in World One project in Upper Worli (Lower Parel), Mumbai

The developers were held liable for promoting the project without the requisite statutory approvals and for prolonged delays, exceeding four years, in handover. While property buyers faced many issues earlier, the enactments of the Real Estate Regulatory Authority Act of of 2016 (Rera Act) has led to a significant increase in transparency and accountability within the sector. The Act empowers homebuyers and allottees by granting them several rights.

Construction timeline

Under Rera, developers must inform buyers about the stage-by-stage schedule for project completion. This information should be clearly stated in the sale agreement or the allotment letter. “Any delay entitles the allottee to the remedies mentioned in the Rera Act.”

Experts say the homebuyers should not sign the Builder-Buyer Agreement (BBA) if the construction schedule is not mentioned in it. Raj Khosla, founder and managing director of MymoneyMantra.com, informs that homebuyers can also acquire a detailed construction schedule of their project from the Rera website.

Home loan borrowers should ensure that disbursements by the bank are aligned with construction stages, she should check in the Tripartite Agreement and the loan agreement that Agreement and the loan agreement that the disbursal of the loan amount is based on the stage of construction or the construction schedule.”

Right to posses the property

According to section 19 (3) of the Rera Act, buyers are entitled to claim possession of the property building associations are entitled to lay claim to common areas on date of possession. Homebuyers should check the BBA for a default clause ( the provisions in a contract that states what will happen if either party defaults or fails to hold up their end of the agreement) for anything that may be disadvantageous to them.

Right to refund

Section 19(4) of the Rera Act entitles allottee to a refund if the developer doesn’t comply with the terms of the sale agreement. “Under Section 18 of the Rera Act, an allottee is entitled to seek a full refund with interest for the period of delay.” The Supreme Court had ruled in a consumer’s complaint case that an individual’s cannot be kept waiting indefinitely for the possession of her allotted property and is entitled to a refund as well as compensation.

The right to refund exists even if the buyer had consented to alternations in the project plan initially. “If the allottee feels that the changes will affect her adversely, she has the right to seek a refund, even if she had given her consent in the allotment letter.”This is because the consent was given without knowing the full implications of the intended changes, which were not disclosed to her earlier.

If the builders fail to give possession, the homebuyer should issue a legal notice. Roy says if the developer fails to deliver possession or reply to the notice, the buyer should lodge a formal complaint under Rera for cancelation and refund, including interest and compensations.

Access to documents

Section 19(5) of the Rera Act gives buyers the right to access all crucial documents (like No Objection Certificate), and plans (say, drawings) throughout the construction process. “The purpose is to allow the buyer to analyse the project’s status and whether there are any implications on her decisions to own a property in it.”If the developer does not comply, buyers can seek intervention under Section 35.

Verify all relevant documents before investing.”If the developer denies access to any document, treat it as a red flag,”

HOMEBUYER’S CHECKLIST: COLLECT THESE DOCUMENTS

The homebuyers should collect a copy of the flat’s unit booking from, allotment letter, and builder-buyer agreement from the builder.

Register the Sale Deed with the authority concerned and keep a copy

Don’t forget to ask the builder for a copy of the possession letter and all the payment receipts

Check the completion certificate issued by the authority concerned once the project is completed

Homebuyers should collect a copy of documents from the bank, such as the loan agreement and the tripartite agreement.

For More Details: Pooja Manoj Gupta, visit www.giia26.com
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