Appeal No.73 of 2023 and M.A.No.218 of 2023
The Tamil Nadu Real Estate Appellate Tribunal, in Appeal No.73 of 2023 and M.A.No.218 of 2023 delivered on 3 November 2023, dismissed an appeal by M/s. Akshaya Signature Homes Private Limited against the Tamil Nadu Real Estate Regulatory Authority. The Tribunal upheld a penalty of Rs.2,00,000 for misrepresenting the allotment of a basement car park adjacent to a lumber room in the LEVEL UP project at Nungambakkam, Chennai.
What the case concerned
The Tamil Nadu Real Estate Appellate Tribunal considered a dispute involving the LEVEL UP project at Sterling Road, Nungambakkam. The project, promoted by M/s. Akshaya Signature Homes Private Limited, consisted of 49 apartments, two basement levels for car parking and eight floors above ground level.
Gorantla Geosynthetics Private Limited purchased two apartments and was allotted four covered car parks, including two in the lower basement. It also purchased a lumber room beneath the ramp, with a promise that its two lower basement car parks would be adjacent to that room.
Seshadri S. and Chandrika S. had previously been allotted one lower basement car park. The promoter later found that this space was also one of the car parks promised as adjacent to the lumber room.
Findings of the Tribunal
The Tamil Nadu Real Estate Appellate Tribunal recorded the following findings:
- The promoter admitted that its employees had made the duplicate allotment because of a misconception of facts.
- The promoter was responsible for mistakes committed by its employees.
- Checking the building plan would have shown the locations of the ramp, lumber room and adjacent car park.
- The promoter could not fulfil its promise to provide two lower basement car parks adjacent to the lumber room.
- The promoter was liable for misrepresentation concerning the car park allotment.
The Tribunal rejected the promoter's explanation that the mistake became apparent only when construction reached its final stage.
Result and directions
The Tamil Nadu Real Estate Appellate Tribunal dismissed Appeal No.73 of 2023 at the admission stage and found no reason to interfere with the Tamil Nadu Real Estate Regulatory Authority's order dated 20 July 2023 in C.No.111 of 2022.
The Tribunal directed M/s. Akshaya Signature Homes Private Limited to remit the full penalty of Rs.2,00,000 to the Tamil Nadu Real Estate Regulatory Authority immediately, if it had not already been paid. After producing valid proof of full payment, the promoter could withdraw the Rs.60,000 deposited before the Tribunal under Section 43(5) of the Real Estate (Regulation and Development) Act, 2016. The connected miscellaneous application was closed.
Who is affected
The decision directly affects the promoter and the three respondents involved in the disputed car park allotment. It also shows how the Tribunal treated a promoter's failure to verify plans before promising a specific car park location.
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Common questions
Did the promoter succeed in cancelling the penalty?
No. The Tamil Nadu Real Estate Appellate Tribunal dismissed the appeal and upheld the Rs.2,00,000 penalty imposed by the Tamil Nadu Real Estate Regulatory Authority.
Why was the promoter held responsible for the car park dispute?
The promoter had allotted the same lower basement car park in a way that conflicted with its promise to provide two spaces adjacent to the lumber room. The Tribunal held that the promoter was responsible for its employees' mistake and could have identified the problem by checking the building plan.
What must the promoter do after the appeal was dismissed?
M/s. Akshaya Signature Homes Private Limited must remit the full penalty of Rs.2,00,000 to the Tamil Nadu Real Estate Regulatory Authority immediately, if it has not already paid it.
Can the promoter recover the Rs.60,000 deposited with the Tribunal?
Yes. The promoter may withdraw the Rs.60,000 deposit after producing valid proof that the entire Rs.2,00,000 penalty has been remitted to the Tamil Nadu Real Estate Regulatory Authority.
