Case law, Tamil Nadu land law
Appeal No.60 of 2023 and M.A.No.189 of 2023
The Tamil Nadu Real Estate Appellate Tribunal, covering Tamil Nadu, Puducherry and the Andaman and Nicobar Islands, delivered its order in Appeal No.60 of 2023 and M.A.No.189 of 2023 on 17 November 2023. It dismissed M/s.Colorhome Developers Private Limited's appeal and confirmed that the ongoing KANCHIPATTINAM villa project must be registered with TNRERA because promised amenities remained incomplete.
What the case concerned
Appeal No.60 of 2023 was filed by M/s.Colorhome Developers Private Limited against M/s.Kanchipattinam Villa Owners Association Karai. The developer asked the Tamil Nadu Real Estate Appellate Tribunal to set aside the TNRERA order dated 2 March 2023 in C.No.66 of 2022 and dismiss the owners association's complaint.
The association had sought directions requiring registration of the project and completion of pending works and amenities promised in the Construction Agreement and brochure.
Why registration was disputed
The developer argued that KANCHIPATTINAM in Karai Village, Kanchipuram Taluk, was a layout project rather than a villa project. It relied on the transfer of roads and Open Space Reservation land to the local body through a registered Gift Deed dated 16 June 2014. It also claimed that it constructed villas only as a builder and not as a promoter.
The Tamil Nadu Real Estate Appellate Tribunal rejected those arguments because:
- The approved layout proposed 263 plots, but the sale agreement prevented plot purchasers from engaging another builder for three years after execution of the sale deed.
- That restriction showed an intention by the developer to develop the villas itself.
- The statutory definition quoted in the decision includes a person acting as a builder within the meaning of promoter.
- A villa project could not be developed under approval obtained for a layout project.
Incomplete amenities
The Construction Agreement and brochure promised amenities including:
- A 20,000 square foot club house with a gym, swimming pool, indoor games and badminton court.
- A community hall, school, supermarket and other facilities.
- An outer compound wall, gates and 24 hour security for the gated community.
The developer admitted that several amenities had not been constructed. The Tribunal found that the brochure did not specifically state that plot owners could use the club house only through membership or payment. It held that incomplete promised amenities made the development an ongoing villa project requiring TNRERA registration.
Outcome
The Tamil Nadu Real Estate Appellate Tribunal found no reason to interfere with the TNRERA decision and dismissed Appeal No.60 of 2023. It also dismissed M.A.No.189 of 2023, refusing to admit photographs because the developer gave no acceptable reason for failing to produce them earlier and supplied no corroborative evidence.
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Common questions
Does the KANCHIPATTINAM project have to be registered with TNRERA?
Yes. The Tamil Nadu Real Estate Appellate Tribunal held that it was an ongoing villa project because promised amenities had not been provided, and therefore required TNRERA registration.
Can the developer avoid promoter responsibilities by describing itself only as a builder?
No in this case. The Tribunal relied on the definition quoted in the decision, which includes a person acting as a builder within the meaning of promoter.
Were the promised club house and other facilities completed?
No. The developer admitted that the club house, community hall, school, supermarket and other listed amenities had not yet been constructed.
Did the Tribunal accept the developer's photographs as additional evidence?
No. M.A.No.189 of 2023 was dismissed because no acceptable reason was given for not producing the photographs before TNRERA, and the photographs lacked corroborative evidence.
