Case law, Tamil Nadu land law
Appeal No. 17 of 2022, P. Rani Vellamal v. M/s. Green Avenue Homes & Gardens and others
The Tamil Nadu Real Estate Appellate Tribunal issued its decision in Appeal No. 17 of 2022 on 9 October 2023, dismissing an allottee's appeal concerning delayed possession in the Dakshin Avenue, Phase 5 residential project. The Tribunal upheld the finding that M/s. Green Avenue Homes & Gardens was liable to pay compensation, while the other respondents were not jointly liable because the evidence did not establish them as promoters.
What the appeal concerned
Appeal No. 17 of 2022 arose from delayed possession of a villa in the Dakshin Avenue, Phase 5 project at Unamancherry, Vandalur, Chennai. The allottee had entered into a construction agreement with M/s. Green Avenue Homes & Gardens on 22 March 2012. The agreement provided for possession within 15 months, with a grace period of three months.
The Tamil Nadu Real Estate Regulatory Authority had directed the promoter to hand over the villa by 15 July 2019. Possession was given on 18 November 2019, four months after that deadline and without all amenities.
Compensation and the issue on appeal
The Adjudicating Officer of the Tamil Nadu Real Estate Regulatory Authority awarded interest at 10.65 per cent per annum on the amounts paid by the allottee as compensation for delayed possession. The liability was placed on M/s. Green Avenue Homes & Gardens.
The allottee appealed because Respondents 2 and 3 had been treated only as real estate agents. She sought to make Respondents 2, 3 and 4 jointly liable for the compensation and other awarded amounts.
Tribunal's findings
The Tamil Nadu Real Estate Appellate Tribunal found:
- The allottee had no agreement with Respondents 3 and 4.
- An email referring to M/s. Green Avenue Homes & Gardens as a “partner” did not prove that M/s. Artha Real Estate Corporation Limited was a joint promoter.
- A later email informed the allottee that the marketing agreement had been discontinued and that Artha would not participate in day to day project operations.
- The marketing agreement identified M/s. Bennet Property Holdings Company Limited as the marketing associate and M/s. Green Avenue Homes & Gardens as the developer.
- Under that agreement, the developer alone was responsible for title, approvals, development quality and related lapses. The marketing associate's responsibility was limited to procuring sales and ended after registration of the villas.
The Tribunal concluded that Respondents 3 and 4 could not be treated as promoters under the Real Estate (Regulation and Development) Act, 2016. It found no reason to interfere with the Adjudicating Officer's decision and dismissed the appeal without costs.
Who is affected
Appeal No. 17 of 2022 directly affects the allottee and the four respondents in the Dakshin Avenue dispute. For buyers in similar disputes, it shows that marketing communications alone may not establish joint promoter liability when the agreements and responsibilities identify another party as the developer.
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Common questions
Did the allottee lose the delayed possession compensation?
No. The compensation awarded against M/s. Green Avenue Homes & Gardens remained undisturbed. The appeal failed only in its attempt to make Respondents 2, 3 and 4 jointly liable.
Why was the marketing associate not made liable as a promoter?
The marketing agreement limited the associate's role to procuring sales and placed responsibility for title, approvals, development and quality on the developer. The Tribunal also found no agreement between the allottee and Respondents 3 and 4.
Was an email describing Artha as a partner enough to prove joint promoter status?
No. The Tribunal held that the use of the word “partner” in one email did not prove that M/s. Artha Real Estate Corporation Limited was a joint promoter.
What was the final result of Appeal No. 17 of 2022?
The Tamil Nadu Real Estate Appellate Tribunal dismissed the appeal on 9 October 2023 and awarded no costs.
