In a significant decision reinforcing the rights of homebuyers, the Haryana Real Estate Regulatory Authority (HRERA) has directed Ocean Seven Buildtech to refund Rs 7 lakh along with interest to an allottee whose flat allotment was cancelled over alleged non-payment. The order, issued on November 13, 2024, clarifies that the cancellation was unjustified and that the promoter’s arguments regarding jurisdiction and force majeure were untenable.
Background of the Dispute
Sachin Kumar had booked a residential unit in “Expressway Towers,” an affordable housing project located in Sector-109, Gurugram. The total cost of the unit was Rs 12,28,000. By paying Rs 7,31,251, he had already contributed approximately 60% of the total price. Despite this substantial payment, the promoter issued a cancellation letter on September 3, 2021, citing non-payment of the remaining balance.
Feeling aggrieved, the allottee approached HRERA, challenging the cancellation and seeking relief, including a refund of the amount paid along with interest.
HRERA’s Findings on Possession Timeline
HRERA examined the project’s regulatory approvals and calculated the due date for possession. The environmental clearance was granted on November 30, 2017. Under the Affordable Housing Policy, 2013, the promoter is entitled to four years for project completion, making November 30, 2021 the initial completion deadline.
Additionally, HRERA provided a six-month grace period due to Covid-related disruptions, extending the due date for possession to May 30, 2022. The Authority held that the project delay beyond this timeline could not be justified using force majeure claims.
Promoter’s Arguments Rejected by HRERA
The builder raised multiple objections in its defence:
• The buyer agreement included an arbitration clause, and therefore HRERA had no jurisdiction.
• Delays were caused by force majeure events such as NGT bans, Covid disruptions, and suspension of licence.
• The freezing of the accounts had further halted progress.
HRERA rejected these submissions. The Authority clarified that the suspension of the licence and freezing of accounts occurred due to violations on the part of the builder, and therefore could not be considered force majeure. It also reiterated that the presence of an arbitration clause does not oust the jurisdiction of the regulatory authority when it comes to safeguarding homebuyers’ rights.
Order for Refund and Interest Payment
After reviewing all facts and submissions, HRERA directed Ocean Seven Buildtech to refund Rs 7,00,000 to the allottee, after deducting Rs 25,000, along with interest at the rate of 10.85% per annum. The refund must be completed within 90 days from the date of the order.
The ruling emphasises that homebuyers cannot be penalised for delays caused by developers, especially when the promoter is responsible for regulatory lapses and violations that interrupt project timelines.
Conclusion
The HRERA order reinforces a consistent legal principle: developers cannot arbitrarily cancel allotments or cite force majeure without solid legal grounds. The decision provides much-needed relief to the allottee and serves as a strong reminder to builders about accountability and compliance, especially in affordable housing projects where buyers often invest their lifelong savings.
