Advertisement
In a recent ruling, the Maharashtra Real Estate Regulatory Authority (MahaRERA) rejected refund claims submitted by six homebuyers of a Chembur housing project who had defaulted on payment obligations during the pandemic. While five of them sought to withdraw from the project, one requested an extension. MahaRERA concluded that none were eligible under Section 18 of the RERA Act, as the defaults were on the buyers' part. However, one buyer was granted a refund in line with the terms of the agreement. The ruling underlines the regulator's position on payment discipline and its limited scope for leniency, even under pandemic-related hardships.
MahaRERA has dismissed refund petitions filed by six homebuyers in a Godrej Properties project located in Chembur, Mumbai, ruling that the applicants were not eligible for relief under Section 18 of the Real Estate (Regulation and Development) Act, 2016. All six buyers had defaulted on their payment commitments, with five seeking cancellation and one requesting additional time to fulfil the financial obligation. Advertisement
The developer, citing these defaults, terminated the bookings and moved to forfeit the buyers' deposits. One buyer argued that the Covid-19 pandemic had severely affected his financial condition, making it impossible for him to continue with the payments. His advocate stated that, during the pandemic, the allottee had stopped paying instalments and eventually received a termination notice demanding the return of all original documents related to the flat.
Advocate Abhijeet Mangade, representing Godrej Properties, informed the authority that there had been no default from the developer's end, and it was the homebuyers who had failed to make timely payments. He added that the refunds could not be claimed as the obligations outlined in the agreements had not been fulfilled by the allottees.
MahaRERA Chairperson Manoj Saunik upheld this view, stating that under Section 18, buyers are eligible for refunds only when the promoter is at fault-for instance, in cases of project delays or failure to deliver possession as agreed. In this case, he noted, the allottees had themselves failed to meet payment terms, disqualifying them from invoking the protection of Section 18.
However, the authority made an exception for one buyer, stating that under Section 19(6), which requires homebuyers to make payments as per the schedule in the agreement, the buyer was entitled to a refund in accordance with the agreement terms. MahaRERA directed that this refund be processed within 60 days from the date of the order.
The Chembur project in question has made significant progress, having received two part occupancy certificates one in March 2022 and another in December 2023 indicating that possession-related activities are underway and further limiting the scope for RERA-based relief tied to project delays.
Over the past few years, MahaRERA has seen a rise in cases where buyers have invoked Section 18 to seek refunds due to delays or contractual disputes. In several instances, it has ruled in favour of buyers even when registered agreements were not in place. For instance, earlier this year in Panvel, the authority directed a developer to refund an NRI buyer based only on a booking form, establishing that even unregistered transactions could attract Section 18 protections if default was from the promoter's side. However, in this Chembur case, the key difference was the buyer-side default, which left little room for leniency.
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
