Appeal No. 5 of 2024 and M.A. Nos. 6 and 37 of 2024
The Tamil Nadu Real Estate Appellate Tribunal (Tamil Nadu, Puducherry, Andaman & Nicobar Islands) delivered its order in Appeal No. 5 of 2024 and M.A. Nos. 6 and 37 of 2024 on 17 April 2024. It found that, during execution, TNRERA could not alter its earlier direction imposing joint liability on the promoters by issuing a recovery warrant against only M/s. Optima Homes Private Limited.
What the case concerns
Appeal No. 5 of 2024 before the Tamil Nadu Real Estate Appellate Tribunal arose from G. Baskaran's purchase of an apartment in the residential project called "Optima Upgrade". The allottee claimed that payments were made partly by adjusting amounts owed to his building materials business, and that he had paid Rs.40,26,210 in total.
The apartment was handed over on 11 January 2018, although some minor work remained. The promoters did not execute a registered sale deed in the allottee's favour and later sold the apartment to a brother of two of the promoters.
Earlier TNRERA directions
In its order dated 9 February 2023, TNRERA directed the promoters to take one of the following steps:
- Hand over an alternative flat with equal carpet area and undivided share of land.
- Explore resale of the same flat to the allottee, without requiring further payment.
- If neither option was completed, jointly refund Rs.40,26,210 with interest at 9.30 per cent per year from the respective payment dates until refund.
TNRERA also imposed a joint penalty of Rs.1,50,000 on the promoters, excluding the fourth respondent, who had died.
Execution dispute and tribunal finding
After the promoters did not comply, the allottee filed Execution Petition No. 25 of 2023. In the execution proceedings, TNRERA relieved respondents 2 to 5 from liability and directed a recovery warrant only against M/s. Optima Homes Private Limited.
The Tamil Nadu Real Estate Appellate Tribunal found that TNRERA, when executing its earlier order, had no power to alter or modify that order. Because the original direction imposed joint liability, the tribunal stated that recovery warrants should have been issued against all liable promoters, except the deceased fourth respondent. TNRERA could not later restrict recovery to the company alone.
Who may be affected
The ruling is relevant to allottees enforcing TNRERA orders against multiple promoters, directors or other respondents. It also matters to promoters named jointly in a final direction, because the execution process cannot relieve some respondents by changing the liability fixed in the original order.
The tribunal also found that additional documents requested in M.A. No. 37 of 2024 were unnecessary because the appeal could be decided without them.
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Common questions
Can TNRERA change joint liability while executing its earlier order?
No. The Tamil Nadu Real Estate Appellate Tribunal found that TNRERA could not alter or modify its original directions during execution.
Was recovery limited to M/s. Optima Homes Private Limited?
TNRERA initially issued a recovery warrant only against the company. The tribunal found that recovery should follow the earlier joint liability direction against all liable promoters, excluding the deceased fourth respondent.
What amount was the allottee entitled to recover if no flat was provided?
The earlier TNRERA order directed a joint refund of Rs.40,26,210 with interest at 9.30 per cent per year from the respective payment dates until refund.
Did the tribunal accept the additional documents requested by the allottee?
The tribunal found that the documents sought in M.A. No. 37 of 2024 were unnecessary because the issue could be decided without them.
