RERA orders Bengaluru-based developer to hand over villa, pay compensation

Bengaluru: The Karnataka Real Estate Regulatory Authority (K-RERA) has pulled up Total Environment Building Systems Ltd, a Bengaluru-based developer, for failing to hand over a villa to Byatarayanapura residents within the promised timeline.

In an order dated March 11, K-RERA partly allowed the plea of homebuyers in the “After the Rain–Phase 1” project, observing that the developer had failed to meet the agreed possession deadline of May 31, 2023.

The Authority directed the developer to execute the sale deed and also ordered the firm to pay nearly Rs 70 lakh in interest for a delay of about two years in handing over possession.

The case pertains to a villa project in North Bengaluru.

The original owner purchased the villa for Rs 3.21 crore in July 2014. Eight years later, he sold it to the present complainants for Rs 4.77 crore. However, even after more than a decade since the original purchase and multiple deadline extensions, the project remained incomplete, prompting the complainants to approach K-RERA last year seeking relief.

The developer argued that the delay was due to the assignment process (transfer of ownership from the original buyer to another purchaser) and non-payment of the final installment.

It also stated that the completion timeline was extended due to customisation work requested by the buyers and claimed that the project was substantially complete, with only “minor works” pending.

However, the Authority ruled that the responsibility to complete the project within the stipulated timeline rests with the promoter. It also rejected the developer’s contention that obtaining an Occupancy Certificate (OC) absolved it of liability, noting that possession is considered complete only when the unit is ready for habitation and actually handed over to the buyer.

Accordingly, K-RERA directed the developer to hand over physical possession of the villa upon receipt of the remaining sale consideration of about Rs 12.51 lakh and to execute the sale deed in favour of the complainants.

It further ordered the payment of delay interest from June 1, 2023, until the actual offer of possession in July 2025, calculated on the total consideration of Rs 3.31 crore.