H-Rera Orders Builder to Refund ₹6 Lakh to Homebuyer After Flat Booking Cancellation

The Haryana Real Estate Regulatory Authority (H-Rera) has directed a developer in Gurgaon to refund ₹5.8 lakh to a homebuyer along with an annual interest of 11% for failing to meet its commitments. The ruling follows a complaint filed by the buyer against the developer of a residential project in Sector 103.

Background of the Case

In April 2019, Bharat and Poonam Gupta booked a 2BHK flat in Mahira Homes by making an initial payment of ₹1.15 lakh. The developer confirmed the allotment of a 570 sq. ft. flat in Tower G on July 1, 2019, for a base price of ₹23.3 lakh. Subsequently, the buyer paid an additional ₹4.7 lakh via cheque, bringing the total paid amount to ₹5.88 lakh. However, the developer did not issue a receipt for this transaction.

Despite making these payments, the homebuyer did not receive a builder-buyer agreement, which was required to secure a home loan. The developer attributed this to the lack of an environmental clearance certificate. However, the buyer alleged that the developer continued demanding further payments despite the absence of this clearance.

The buyer sought a home loan from Punjab National Bank, but the request was denied. In January 2020, the developer unilaterally cancelled the flat booking without issuing a refund. After unsuccessful attempts to recover the amount, the buyer approached H-Rera in January 2024.

H-Rera's Observations and Ruling

H-Rera reviewed the complaint in hearings held on January 17 and February 21, 2024. The regulatory body noted that the developer failed to file responses despite multiple directives. On February 5, H-Rera ruled in favor of the buyer, citing a violation of Section 13(1) of the Real Estate (Regulation and Development) Act, 2016. This section prohibits developers from collecting more than 10% of the total property price without executing a sale agreement.

Further scrutiny revealed that Mahira Homes had been under regulatory review since May 2022 due to multiple violations. The project’s accounts were frozen, and the developer was blacklisted. On March 11, 2024, H-Rera revoked the project's registration, preventing the sale of unsold units.

Considering these factors, H-Rera ordered the developer to refund the full amount of ₹5.8 lakh along with an annual interest of 11.1%. The developer has 90 days to comply with the order. Failure to do so could result in further legal action.

This case underscores the importance of regulatory oversight in the real estate sector. For homebuyers, it highlights the risks of investing in projects that lack necessary approvals. Buyers are advised to verify environmental clearances, sale agreements, and regulatory compliance before making payments.

For developers, the ruling reinforces the necessity of adhering to legal and regulatory requirements. Failure to meet commitments not only affects financial credibility but also exposes developers to legal penalties.

The real estate sector has seen multiple disputes related to delayed projects, missing approvals, and non-compliance with RERA guidelines. Cases like this reinforce the importance of ensuring transparency and legal compliance in property transactions.