In a significant order, the Tamil Nadu Real Estate Regulatory Authority has faulted the construction agreement that favours only the developer and said homebuyers cannot be expected to bring in new customers to exit a project. A promoter marketing a project for another developer cannot disown responsibility as homebuyers invest based on the reputation, it added.
It also imposed a penalty of Rs 5 lakh for causing mental agony to the buyer, refund payment of Rs 1.8 crore with 10% interest and registration fees of nearly Rs 5 lakh. Pointing to a clause in the agreement which says a promoter shall reimburse the amount to a homebuyer only after the latter identifies another customer, TNRERA adjudicating officer G Saravana said it was onerous, unfair and one-sided.
The case pertains to ‘Bay Influence’, a villa project developed at Thiruvidanthai on ECR by Influence Infrastructure and Influence Enterprises (India) Pvt. Ltd., and promoted by Vijay Shanthi Builders Ltd. A homebuyer, who paid about 72% of the cost, moved TNRERA saying the villa that was to be completed in 2013 was not delivered and sought to withdraw from it. The developers sought to dismiss the complaint saying it was not maintainable.
Counsel for Vijay Shanthi Builders Ltd. said an advertisement was issued (regarding the project) in the media for a demand survey. Noting that the promoter can’t be made liable for any relief sought by the complainant, counsel said there was no evidence to establish any nexus between first and second developer and them.
TNRERA said the advertisement didn’t mention it was for a demand survey and not sale. This was material evidence, it said, adding that the buyer booked the villa based on the promoter’s reputation.