TGRERA Penalizes Hyderabad Builder ₹13.74 Lakh for Agreement of Sale Violation

The Telangana State Real Estate Regulatory Authority (TGRERA) has imposed a fine of ₹13,74,436 on a builder for not adhering to the stipulated format of the Agreement of Sale while selling an apartment. The penalty was also imposed for failing to register the Agreement of Sale, as mandated by law.

The penalty was issued under Section 13 read with Section 61 and Section 4 read with Section 60 of the Real Estate (Regulation and Development) Act, 2016. The ruling was delivered by a three-member panel comprising Chairman Dr. N Satyanarayana and members K Srinivasa Rao and Laxmi Narayana Jannu in Complaint No. 158 of 2024.

The complainant, Veluri Adi Lakshmi, filed a case against builder Vineela Arani, who was constructing a stilt plus five-storied building at Park Avenue in Kondapur, Serilingampally Mandal. She had planned to purchase a flat on the fifth floor for ₹1,14,32,000 and had paid ₹63,45,000 in installments. However, she alleged that the builder refused to register the apartment and demanded additional money, citing an escalation in costs.

Withdrawal and Refund

After negotiations, the complainant agreed to withdraw from the project, and the builder refunded the paid amount except for ₹95,000, which was classified as the ‘booking amount.’ The authority ruled that the buyer was not entitled to a refund of the booking amount since the cancellation was initiated by the complainant.

Key Rule Violations

The authority identified two specific violations by the builder that resulted in the penalty:

• Deviation from the Submitted Agreement of Sale: As per Rule 38, the Agreement of Sale used by the builder must match the draft submitted to TGRERA at the time of project registration. The builder, in this case, used an entirely different agreement, violating this requirement.
• Failure to Register the Agreement of Sale: The Agreement of Sale between the complainant and the builder, executed on January 25, 2024, was not registered. Section 13 of the Real Estate Act mandates that all executed Agreements of Sale be registered. The builder's failure to do so was considered a violation of the law.

TGRERA’s Order

TGRERA ordered the builder to pay the penalty amount to the RERA fund within 30 days. Additionally, the builder was directed to ensure that all Agreements of Sale align with the versions submitted during project registration. The authority also warned that further violations could attract additional penalties under Section 63 of the Act.

This ruling highlights the importance of compliance with RERA regulations. Builders must ensure that Agreements of Sale match the submitted versions and are duly registered. Homebuyers, on the other hand, should verify the legality of agreements before making payments to avoid complications during registration.

TGRERA’s decision strengthens the enforcement of real estate regulations in Telangana, ensuring that both buyers and developers adhere to the prescribed legal framework. The case serves as a reminder for all stakeholders to maintain transparency and comply with the Real Estate (Regulation and Development) Act, 2016.

Image source- telangana.gov.in