A Delayed Dream: Rajasthan RERA Case - Sanjay Mathur vs Hindustan Fibres Ltd.

In the realm of real estate, homebuyers invest their hard-earned money with high hopes of owning their dream homes. However, instances of delays in project completion and possession have become all too common, leaving many homebuyers in distress.

One such case that came before the Rajasthan Real Estate Regulatory Authority (RERA) in Jaipur was Complaint No. RAJ-RERA-C-2020-3903, involving Sanjay Mathur, a determined homebuyer, and Hindustan Fibres Ltd. (HFL), the developer.

Sanjay Mathur, represented by Advocate Abhinav Shekhar, had booked a 3 BHK flat measuring 1750 sq. ft. in the ambitious project, "HFL Presidency Estate" situated in Bhiwadi, with a total sale consideration of Rs. 58.63 lakh. On 12th December 2015, he paid a booking amount of Rs. 6.75 lakh, followed by subsequent payments totaling Rs. 49.34 lakh. To make timely payments, Sanjay sought a bank loan of Rs. 51.20 lakh from HDFC Bank, which was sanctioned, and a tripartite agreement was signed.

However, as fate would have it, the construction work at "HFL Presidency Estate" faced significant delays. In a glimmer of hope, an agreement for sale was entered into on 14th December 2016, assuring completion within 36 months, with a grace period of 6 months, subject to timely payments.

The promised date of possession was May 2020. But alas, the project remained unfinished, and RERA's registration lapsed in March 2020. The QPRs (Quarterly Project Reports) submitted by HFL in 2020-21 also revealed the project's incomplete status.

Advocate Yogesh Sharma, along with Adv Mitesh Rathore and Adv Samkit Jain, represented Hindustan Fibres Ltd. They admitted receiving the payment of Rs. 49.34 lakh from Sanjay but contested the total sale consideration, claiming it was Rs. 64.75 lakh and not Rs. 58.63 lakh. They argued that the project faced delays beyond their control and financial stress.

After a thorough examination of the case records and hearing arguments from both sides, Shri Shailendra Agarwal, Hon'ble Member of RERA, delivered a well-reasoned verdict. The total sale consideration was deemed irrelevant to the case. What mattered was the fact that the project was incomplete, with possession still pending, even though more than 2.5 years had passed since the promised date of completion. The project's registration had lapsed, indicating a lack of construction activity.

RERA relied on an important observation by the Hon'ble Supreme Court (dated 11th November 2021) in the case of Newtech Promoters and Developers Pvt. Ltd. Vs. State of Uttar Pradesh and others. The observation underscored the unqualified right of allottees to seek refunds in cases of delayed possession, regardless of unforeseen events or stay orders from courts or tribunals.

Considering the observations of the Hon'ble Supreme Court and the genuineness of the complainant's demand, RERA ruled in favor of Sanjay Mathur. Hindustan Fibres Ltd. was directed to refund the entire amount of Rs. 49.34 lakh along with interest at the rate prescribed in the Rajasthan Real Estate (Regulation & Development) Rules, 2017, which was SBI's highest MCLR + 2%, totaling 9.30%.

The developer was given a 45-day window to comply with the order and provide a compliance report within 15 days thereafter. Failure to adhere to the order would grant Sanjay Mathur the right to recover the amount from the developer's assets through execution of the decree as per the provisions of the Act and Rules.

Additionally, the complainant was advised to approach the Adjudicating Officer under the Act for compensation.

The case of HFL Presidency Estate serves as a stark reminder of the challenges faced by homebuyers in the real estate market. RERA's role in protecting the interests of homebuyers and ensuring accountability from developers is crucial. This verdict highlights the rights of allottees and provides hope for others who find themselves in similar situations.

Note: The information provided in this article about Rajasthan Real Estate Regulatory Authority (RRERA) is for informational purposes only. It is not intended as legal or professional advice and readers should consult qualified professionals for advice specific to their circumstances. The information provided in this article is based on the Complaint No. RAJ-RERA-C-2020-3903 before the Rajasthan Real Estate Regulatory Authority

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