Case law, Tamil Nadu land law
Appeal No.74 of 2023
The Tamil Nadu Real Estate Appellate Tribunal, in Appeal No.74 of 2023 delivered on 6 December 2023, partly allowed an appeal by two allottees in the Pacifica Aurum project and modified the Tamil Nadu Real Estate Regulatory Authority order in C.C.P.No.139 of 2021. The Tribunal directed the promoters to pay interest at 9.30 percent per annum on the amounts paid by the allottees, calculated from the dates of their respective payments until the promoters actually pay, while leaving the rest of the earlier order unchanged.
What the case concerns
Appeal No.74 of 2023 before the Tamil Nadu Real Estate Appellate Tribunal concerns delayed possession of a unit in the Pacifica Aurum project. The appellants, A. Kantharuby and K. Ayyanarappan, were allottees, while M/s. Sylvanus Builders and Developers Limited and M/s. Pacifica (Chennai Project) Infrastructure Company Private Limited were the promoters.
The allottees entered into an Agreement for Sale and Construction Agreement on 31 May 2013. The construction and undivided share of land were priced at Rs.96,47,270. The promoters agreed to hand over possession before 31 December 2015, including a six month grace period, but possession was delivered on 22 May 2019, after a delay of 41 months.
What the Tribunal decided
The Tamil Nadu Real Estate Appellate Tribunal found that the earlier Tamil Nadu Real Estate Regulatory Authority decision had recognised the delay and the allottees' entitlement to interest, but had omitted interest from the relief granted.
Key findings and directions were:
- The allottees had not withdrawn from the project and were entitled to interest for delayed possession under the Real Estate (Regulation and Development) Act, 2016.
- The construction agreement made timely possession an essential contractual obligation and also provided for damages in case of delay.
- The promoters had not explained the 41 month delay.
- The promoters must pay interest at 9.30 percent per annum on the amounts paid by the allottees.
- Interest must be calculated from the dates of the respective payments until the date the promoters actually make payment.
- The remainder of the Tamil Nadu Real Estate Regulatory Authority order in C.C.P.No.139 of 2021, dated 20 January 2023, remains unchanged.
Who is affected
Appeal No.74 of 2023 directly affects the two allottees and the two promoters named in the case. The ruling also explains that an allottee who remains in a delayed project may claim interest for every month of delay until possession, at the prescribed rate.
The Tamil Nadu Real Estate Appellate Tribunal did not award compensation for mental agony. It allowed the allottees to file an appropriate petition before the Adjudicating Officer for that compensation.
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Common questions
How much interest did the Tribunal award to the Pacifica Aurum allottees?
The Tamil Nadu Real Estate Appellate Tribunal awarded interest at 9.30 percent per annum on the amounts paid by the allottees, from the dates of their respective payments until the promoters actually pay.
Did the allottees receive compensation for mental agony?
No. The Tribunal stated that the allottees could file an appropriate petition before the Adjudicating Officer for compensation towards mental agony.
How long was possession delayed in this case?
Possession was delivered on 22 May 2019, and the Tribunal recorded a delay of 41 months.
Was the earlier Tamil Nadu Real Estate Regulatory Authority decision completely cancelled?
No. The Tribunal modified it by adding the direction to pay interest. All other aspects of the order in C.C.P.No.139 of 2021 remained unchanged.
