MahaRERA has directed Radius Estates and Developers, a co-promoter of Bandra's Ten BKC project, to allow 14 homebuyers to withdraw from their investments. The developer is required to return the amounts paid by the buyers, along with interest, due to the failure to make provisional or pre-EMI payments and the notable ownership delays. Additionally, Radius Estates has been fined 10 lakh for this matter.
The plaintiffs argue that the developer failed to hand down ownership by November 30, 2019, and neglected to refund the amounts disbursed. Each of the 14 homebuyers reserved apartments in the renovation project between 2016 and 2017 through a subsidy scheme, contributing approximately 63% to 74% of the total price for their units.
Possession and Sale Agreements Not Provided Timely
Tanju Lodha, the lawyer representing the homebuyers, emphasized that the developer has not fulfilled its obligations as per the sale and purchase agreements, meaning it breached its duty to pay pre-EMI to banks, contravening the comfort letter it issued.
Project Delays Attributed to Lockdown
Vibhav Krishna, representing the co-promoter or agent, defended the situation by stating that since the allotment letters remain valid, the homebuyers' complaints are unsubstantiated. He attributed the project's delays to the pandemic-induced lockdown, claiming the completion date has been shifted to December 2022. Furthermore, he noted that the developer continued to fulfill the pre-EMI payments under the subvention scheme up until January 2020, asserting that all funds collected have been invested back into construction efforts.
Commitment to Fulfill Obligations Not Met
MahaRERA member Vijay Satbir Singh pointed out that the co-developer had previously sent comfort letters to the homebuyers, committing to cover pre-EMI expenses until possession was granted. However, payments were halted in February 2020, representing a clear breach of these commitments. Although the co-promoter expressed willingness to repay the pre-EMI amounts previously paid by the applicants, they have not followed through on this promise.
Singh stated that the co-promoter could not accept over 20% of the total remuneration—according to the Ministry of Foreign Affairs—and only 10% under RERA without a registered sales contract. If a buyer is unwilling to finalize the purchase agreement, the proper procedure should have involved either returning the funds or canceling the apartment bookings.
Ultimately, Singh called for the developer to refund the entire amount, including interest calculated at the marginal value of the SBI loan rate plus 2%. He has also instructed that the financial institution concerns regarding reimbursements linked to payments made on behalf of the plaintiffs must be handled separately.