Case law, Tamil Nadu land law
Appeal No.50 of 2023 & M.A.No. 154 of 2023
The Tamil Nadu Real Estate Appellate Tribunal, in Appeal No. 50 of 2023 and M.A. No. 154 of 2023, delivered on 13 September 2023, dismissed an appeal by S. Natarajan and T. Gomala Geetha against M/s. Rajkham Infra Private Limited. The Tribunal rejected their claims for interior work costs and rental loss, and closed the connected miscellaneous application.
What the case concerned
Appeal No. 50 of 2023 arose from the proposed purchase of an apartment in the Silver Crest project promoted by M/s. Rajkham Infra Private Limited. S. Natarajan and T. Gomala Geetha had entered into construction and sale agreements on 18 November 2020 and paid Rs.25,00,000 from October 2020 to December 2020.
The agreed total for construction and the undivided share of land was Rs.42,00,000. The promoter stated that the buyers failed to pay the balance of Rs.17,00,000, after which the allotment was cancelled and the apartment was sold to another person.
Claims made by the buyers
The buyers claimed that they spent Rs.2,87,435 on interior woodwork, painting and pending works. They said the sale deed could not be registered because the promoter had not obtained a no objection certificate from M/s. Shriram Housing Finance Limited.
The buyers also sought Rs.1,50,000 for rental loss. The Adjudicating Officer of the Tamil Nadu Real Estate Regulatory Authority dismissed their complaint on 5 June 2023, leading to the appeal before the Tamil Nadu Real Estate Appellate Tribunal.
Tribunal findings
The Tamil Nadu Real Estate Appellate Tribunal made the following findings:
- Clause 10 of the construction agreement contemplated temporary possession for a house warming ceremony and interior decoration work.
- The promoter's email dated 26 December 2020 permitted the buyers to proceed with the house warming ceremony, but did not expressly grant or refuse permission for interior work.
- Receipts for the claimed woodwork and painting were dated 10 February 2021 and 23 March 2021, rather than January 2021 as proposed by the buyers.
- By 15 January 2021, the buyers knew that a no objection certificate from M/s. Shriram Housing Finance Limited was required for registration.
- The buyers proceeded without a specific written assurance or commitment from the promoter concerning the interior work. The Tribunal therefore treated the work as undertaken at their own risk and cost.
- The rental loss claim lacked details about the rented premises and monthly rent. No rental agreement was produced, and the bank statement could not establish the claim without supporting statements in the complaint.
Result and practical effect
Appeal No. 50 of 2023 was dismissed at the admission stage, and M.A. No. 154 of 2023 was closed. The decision directly affects the named buyers and promoter. For other apartment buyers, it shows the importance of obtaining specific written approval before spending on interiors and providing full rental details and supporting documents when claiming rental loss.
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Common questions
Did the buyers recover the cost of their interior work?
No. The Tamil Nadu Real Estate Appellate Tribunal found no specific written authorization or commitment from the promoter and treated the work as undertaken at the buyers' own risk and cost.
Why was the rental loss claim rejected?
The buyers did not provide details of the rented premises or monthly rent in their complaint, and they did not produce a rental agreement. The Tribunal also declined to rely on the bank statement without supporting statements in the complaint.
What happened to the buyers' Rs.25,00,000 advance?
The decision states that the buyers filed a separate complaint before a Single Member of the Tamil Nadu Real Estate Regulatory Authority seeking refund of Rs.25,00,000 with interest. It gives no further details about that complaint.
Did the Tribunal decide that the promoter was responsible for obtaining the finance company no objection certificate?
The Tribunal noted that the buyers knew by 15 January 2021 that the certificate was required for registration. Its decision in this appeal focused on rejecting the interior work and rental loss claims.
