RERA penalises realtor for delaying in handing over flats

Hyderabad: The Telangana Real Estate Regulatory Authority (TG RERA) ordered Vasavi Realtors LLP to pay interest at the rate of 10.8% per annum to flat buyers of its Vasavi Lake City project at Hafeezpet for failing to deliver possession within the agreed timelines.A group of 23 buyers, including Venkata Satya Naga Sudheer Kurapati of Miyapur, filed a complaint alleging inordinate delay and lack of communication from the developer. The petition was filed in respect of the west wing of the project. As per the agreement of sale, the project was due for handover in Aug 2023. Though the developer extended the date to Feb 2024 with a six-month RERA extension, and later to Feb 2025, none of these commitments were met.The complainants said they paid 1 crore, including 70 lakh through bank transfers and cheques and 38 lakh through bank loans, but the flat was not delivered. They alleged that despite repeated follow-ups with the developer's representatives, including customer relationship manager Rajnikanth and designated partner Vijay Kumar Yerram, they only received false assurances. They also raised issues of deviation in flat size and claimed financial hardship from paying EMIs on both their existing residence and the Vasavi flat since Aug 2023.Authority rejects builder's objectionsIn its order, RERA rejected the preliminary objection of the developer on maintainability, holding that the complaint was valid despite the dispute resolution clause in the agreement of sale. It also held that the developer's reliance on the Covid-19 pandemic as force majeure was untenable since the agreement was signed after the pandemic subsided.The authority ruled that the contractual possession date of Feb 28, 2024, including the grace period, would prevail. Accordingly, it directed the builder to pay 10.85% interest from March 1, 2024, until actual handover. The arrears accrued till the date of the order are to be paid within 60 days, and thereafter, monthly interest must be paid by the 10th of each succeeding month.The order allows complainants to pursue separate compensation proceedings before the Adjudicating Officer under "Form N." The developer has also been directed to complete the project and hand over possession within statutory timelines. Buyers must pay pending dues as per the agreed schedule, while the builder may charge interest on any delayed payments only if substantiated with valid progress-linked evidence.Noting several complaints against the same project, RERA warned that further defaults would attract proceedings under Section 63 of the RERA Act, 2016. The complaint was allowed in part and disposed of with no order as to costs.