Common Order, Appeal Nos. 45 to 54 of 2022

What the case concerns

Common Order, Appeal Nos. 45 to 54 of 2022, concerns Sri Narayanapuram II, a residential plot project developed by M/s. Sri Narayana Foundations at Sepakkam village, Virudhachalam Taluk, Cuddalore District. Ten purchasers had complained to TNRERA, which issued directions against the promoter on 27 April 2022.

The promoter said the project began in 2010 and had local village panchayat approval, but no approval from the Directorate of Town and Country Planning. Each 1,200 square foot plot was offered for Rs.54,000, payable at Rs.2,000 per month for 27 months. According to the promoter, around 1,000 subscribers joined.

Purchasers and promoters affected

The decision directly affects M/s. Sri Narayana Foundations and the ten respondents named in Appeal Nos. 45 to 54 of 2022. It is also relevant to buyers and promoters dealing with plotted developments that remained unapproved or unregularised when the Real Estate (Regulation and Development) Act, 2016 came into force.

The purchasers stated that they completed their instalments by 2012 but did not receive registered sale deeds. They also alleged that, after obtaining planning approval in 2019, the promoter demanded an additional Rs.90,000 from each subscriber. The Tribunal noted that the promoter had not specifically denied that allegation.

Tribunal findings

The Tamil Nadu Real Estate Appellate Tribunal made the following findings:

• A residential layout cannot be formed and sold without prior planning permission from the Directorate of Town and Country Planning at the district level.
• As on 1 May 2017, the layout had not been approved or regularised by the competent planning authorities and local body.
• Even if the project remained unapproved or unregularised, it required registration.
• The project did not fall within the exempted categories under Rule 2(h) of the Tamil Nadu Real Estate (Regulation and Development) Rules, 2017.
• The claim that selling activity ended in 2012 was rejected because the promoter continued bargaining with purchasers for an additional payment.
• The promoter could not withdraw from its original promise and insist on further payment before executing and registering the sale deeds.

Outcome

The Tamil Nadu Real Estate Appellate Tribunal found no merit in the appeals and described them as an abuse of the legal process. All ten appeals were dismissed at the admission stage. The promoter was strictly directed to comply with every direction issued by TNRERA within the due dates specified there.