IN THE HIGH COURT OF JUDICATURE AT BOMBAY
R.D. Dhanuka, J.
Samruddhi Developers - Appellant
Vs.
Kiran Vasant Verekar - Respondent
Second Appeal (Stamp) No. 27914 of 2018, 27898 of 2018, 27901 of 2018, 27903 of 2018, 27908 of 2018; Civil Application No. 1313 of 2018, 1325 of 2018, 1314 of 2018, 1319 of 2018, 1326 of 2018
Decided On : 17-09-2019
Real Estate Regulation and Development Act - Dispute over construction project - Section 58
Fact of the Case:
The appellant, a real estate developer, was involved in a dispute with the respondents over the construction of a building. The appellant had taken over the project from the original developer and was unable to complete the construction within the stipulated time. The respondents filed complaints seeking interest for the delayed construction and possession of their flats.
Finding of the Court:
The court found that the appellant, as the assignee of the real estate project, was bound by the obligations of the original developer under the Real Estate Regulation and Development Act (RERA). The court rejected the appellant's arguments regarding termination of the deed of assignment and lack of consideration from the respondents. The court also dismissed the appellant's claim that the RERA provisions were not retrospective in nature.
Issues: The main issues revolved around the appellant's liability to pay interest for delayed construction and possession of flats, the validity of the deed of assignment, and the applicability of RERA provisions to the appellant as the assignee of the real estate project.
Ratio Decidendi: The court held that the appellant, as the assignee of the real estate project, was obligated to comply with the pending obligations under RERA and the deed of assignment. The court also emphasized the social welfare nature of RERA and the protection it provides to flat purchasers.
Final Decision: The court dismissed the appeals, upheld the findings of the tribunal, and ordered the appellant to pay costs to the respondents.
JUDGMENT :
R.D. Dhanuka, J.
By these five appeals filed under Section 58 of the Real Estate (Regulation and Development) Act,2016 (for short the said RERA), the appellant (original respondent) has impugned the order dated 29th August 2018 passed by the Maharashtra Real Estate Appellate Tribunal, Mumbai (hereinafter referred to as "the said Tribunal") allowing the appeals filed by the respondents (original appellants/ complainants). By consent of parties, all the appeals were heard together and are being disposed of by a common order.
2. The facts in all aforesaid five appeals are identical. Learned counsel for the parties have addressed this Court in Second Appeal (St.) No.27914 of 2018. The facts in the said second appeal are thus summarised in later part of this judgment. Some of the relevant facts for the purpose of deciding these appeals are under :-
3. One Nehru Nagar Amrapali Co.op. Hsg. Soc. Ltd. (hereinafter referred to as "the said society") is lessee of MHADA in respect of the land bearing Survey Nos.229 and 267, corresponding to City Survey No.2(Part) of Village Kurla, admeasuring 707.30 sq.mtrs. situated at Nehru Nagar, Kurla (East), Mumbai 400 024 and owner of the building bearing Building No.133 standing on the said property. The old building No.133 has been demolished and a new building consisting of 7 floors has been constructed on the said property.
4. By and under a registered Development Agreement dated 13th December 2007 executed between the said society and one M/s.Rebuilt Developers, the said society had granted development rights in respect of the said property in favour of the said M/s.Rebuilt Developers. Under the said Development Agreement, the said society had granted right to M/s.Rebuilt to construct a new building on the said property having ground + 7 upper floors containing rehab and sale component tenaments by consuming then permitted 2.4 FSI in favour of the said Rebuilt Developers.
5. It is the case of the appellant that vide a Notification dated 6th December 2012, the Government of Maharashtra permitted utilization of 2.5 FSI for development of MHADA's housing colonies. The said society and the said M/s.Rebuilt Developers thus entered into a Supplemental Agreement dated 5th May 2012 thereby granting development rights in respect of the said additional FSI on the terms and conditions set out therein to the said M/s. Rebuilt Developers. Under the said Supplemental Agreement, the society permitted the said M/s. Rebuilt to construct one more floor i.e. 8th floor by utilizing additional FSI over and above 2.5 FSI + permissible Fungible FSI. The said M/s. Rebuilt Developers partly completed construction of a new building on the said property consisting of ground + 7 upper floors and allegedly delivered possession of the flats therein to the Society Members and open market purchasers in or around 2013 without procuring Occupation Certificate.
6. It is the case of the appellant that the said M/s. Rebuilt Developers executed 9 separate registered agreements and agreed to sell those 9 flats out of 10 flats on the proposed 8th floor to various purchasers thereof including Manoj Sadarangani, one of the partners of the appellant who is residing in Flat Nos.A-805 and B-802. It is the case of the appellant that the appellant found it beyond its capacity to complete the remaining work, including construction of the 8th floor, and was also unable to refund the money/part consideration amount paid by those purchasers of flats on the 8th floor.
7. On 9th November 2015, the said society, the said M/s. Rebuilt Developers and the appellant entered into a Deed of Assignment assigning the development rights of the said property to the appellant on the terms and conditions recorded therein. The said society was a confirming party to the said Deed of Assignment. The said Deed of Assignment was duly registered under No.KRL-3-7594-2015. It was the case of the appellant that some of the respondents herein were witnesses in the
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