Appeal No. 60 of 2019

What the case concerns

Appeal No. 60 of 2019 concerns Jasmine Grove, a development promoted by M/s. T.K. Housing & Constructions near Mahindra World City. The buyers had asked the Regulatory Authority to require registration of the project under the Tamil Nadu Real Estate Regulatory Authority and to direct delivery of their villa under the agreements.

The Regulatory Authority directed the builder to:

• Hand over the villa within one month from its order, according to the agreement.
• Charge only for floor area approved by the competent authority.
• Register the layout with the authority.

The builder appealed against the Regulatory Authority's order dated 20 June 2019.

Main dispute

The builder argued that Villa No. 20A was a stand-alone construction on 1,635 square feet of land and therefore qualified for an exemption. The builder also said that the layout had originally been formed earlier, that regularisation did not bring it within the regulatory law, and that the buyer had not paid the claimed balance amount.

The buyers argued that Jasmine Grove was an ongoing, combined gated community project covering 3.56 acres, with villas and apartments promoted and sold by the same promoter. They also relied on the common maintenance arrangement, project advertising, common open space arrangements and sales made while the complaint and appeal were pending.

Tribunal's findings

The Tamil Nadu Real Estate Appellate Tribunal treated Jasmine Grove as a joint or group development rather than an individual villa project. Its reasons included:

• The brochure described an exclusive gated project containing 75 individual villas over 3.56 acres.
• Villas and apartments were located within one compound wall, without separate compound walls between villas.
• The promoter obtained layout approval for the wider area and executed common open space arrangements.
• Buyers were required to use the promoter's company for construction.
• The promoter undertook responsibility for approval and agreed to maintain the property for 15 years.
• Construction was not complete, and further sale deeds were executed during the complaint and appeal proceedings.

The Tribunal found that the size of one villa could not be considered separately from the larger project. It therefore rejected the argument that Villa No. 20A was exempt merely because of its individual area.

Who may be affected

The findings are relevant to buyers and promoters in developments marketed and managed as gated communities. A promoter cannot necessarily treat each villa as an independent project when the villas form part of a larger development with common promotion, approvals, construction arrangements and maintenance.