Appeal No. 37 of 2021

What the appeal concerns

Appeal No. 37 of 2021 was filed by M/s. North Town Estates Private Limited against Julian Abraham, Deepa Lucia Julian and M/s. PVP Ventures Limited, formerly known as M/s. SSI Limited. The appeal challenged the Adjudicating Officer's order in CCP No. 113/2019 dated 23 October 2020.

The Tamil Nadu Real Estate Appellate Tribunal heard the appeal under the Real Estate Regulation And Development Act 2016. The Tribunal identified three issues, whether the homebuyers' payment should be returned with interest, whether the promoter must pay the compensation ordered below, and whether the appeal should be allowed.

Positions taken by the parties

The promoter argued that the homebuyers had defaulted on agreed payments and withdrew because they bought another flat, not because of construction delay. It also argued that the Adjudicating Officer lacked authority to decide repayment and interest, and asked for the interest, compensation and costs to be set aside.

The homebuyers argued that the payment arrangement had changed from monthly instalments to construction stage based payments. They said an excess payment of Rs.34,00,000 was to be adjusted, no further demand was raised, and they were not informed in writing that construction was complete or that a completion certificate had been obtained.

Agreement terms examined

The Tribunal recorded the following admitted facts and contractual terms:

• The parties entered into an agreement on 19 December 2011.
• Construction was allowed 36 months plus a further 6 months, totalling 42 months.
• The original payment schedule required monthly instalments.
• A purchaser's payment default allowed the developer to claim interest at 18 per cent per year on defaulted instalments.
• If a breach continued for more than 90 days, the agreement gave the developer discretion to terminate and forfeit 25 per cent, or 30 per cent where the undivided land share had already been conveyed.
• The promoter stated that a completion certificate was obtained on 8 February 2019.
• The promoter had deposited Rs.64,24,691 pursuant to a Tribunal direction.

Practical significance

Appeal No. 37 of 2021 may be relevant to buyers and promoters dealing with delayed projects, revised payment schedules, alleged instalment defaults and refund claims. However, the supplied extract stops during discussion of the payment schedule and does not reveal the Tribunal's final ruling.