Case law, Tamil Nadu land law
Appeal Nos. 12 and 13 of 2023, Common Order
The Tamil Nadu Real Estate Appellate Tribunal issued the common order in Appeal Nos. 12 and 13 of 2023 on 21 April 2023, dismissing appeals by the Army Welfare Housing Organisation against compensation awarded for delayed possession of flats in the Dinesh Vihar project. The Tribunal declined to interfere with the Adjudicating Officer's award of interest as compensation because possession was handed over about four years after the agreed completion date.
What the appeals concerned
The Army Welfare Housing Organisation filed Appeal Nos. 12 and 13 of 2023 under the Real Estate (Regulation and Development) Act, 2016. It sought to set aside the common order dated 21 November 2022 passed by the Adjudicating Officer attached to the Tamil Nadu Real Estate Regulatory Authority in two complaints.
The disputes concerned the Dinesh Vihar housing project at Thazhambur Village, formerly in Kanchipuram District and now in Chenglepet District. The project comprised 852 dwelling units in six towers, each with 31 floors above ground level.
Delay in handing over possession
The respondents had each applied for an apartment during November or December 2012. The relevant facts recorded by the Tamil Nadu Real Estate Appellate Tribunal were:
- The agreed completion date was 31 December 2015.
- The project was ultimately completed during May 2019.
- Flats were handed over to the allottees during December 2019.
- The Tribunal found an inordinate delay of four years in handing over possession.
The Adjudicating Officer had awarded interest as compensation for the delayed possession. The Army Welfare Housing Organisation challenged only that award.
Reasons given by the developer
The Army Welfare Housing Organisation argued that the delay arose from circumstances beyond its control. It referred to the Chennai floods in 2015, Cyclone Vardha in 2016, closure of sand quarries, demonetisation and the COVID-19 outbreak. It also argued that it operated on a no profit, no loss basis and should not be required to compensate the allottees.
The Tamil Nadu Real Estate Appellate Tribunal rejected these arguments. It held that the cited events could not justify the delay because they were treated as having occurred after the agreed date for handing over possession. The Tribunal found no reason to interfere with the Adjudicating Officer's decision.
Result and practical effect
The Tamil Nadu Real Estate Appellate Tribunal dismissed both appeals at the admission stage. After expiry of the appeal period, the two respondents were permitted to withdraw the entire amounts deposited by the Army Welfare Housing Organisation for the respective appeals, together with accrued interest. Any connected miscellaneous applications were closed.
The ruling directly concerns the two named allottees and the compensation awarded for delayed possession in the Dinesh Vihar project.
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Common questions
Did the Tribunal cancel the compensation for delayed possession?
No. The Tamil Nadu Real Estate Appellate Tribunal dismissed both appeals and declined to interfere with the Adjudicating Officer's award of interest as compensation.
How late was possession of the Dinesh Vihar flats?
The agreed completion date was 31 December 2015, but the flats were handed over during December 2019. The Tribunal described this as an inordinate delay of four years.
Did floods, cyclone, sand shortage, demonetisation or COVID-19 excuse the delay?
No. The Tribunal rejected these reasons, holding that the cited incidents could not justify failure to hand over possession by the agreed completion date.
What happens to the money deposited for the appeals?
After expiry of the appeal period, the respondents may withdraw the entire amounts deposited for the respective appeals, together with the interest accrued.
