By Legal Cell
In a notable and somewhat uncommon development, the Karnataka RERA (KRERA) has directed Sobha Limited, a prominent developer, to refund the entire amount with an annual interest of 9% to a homebuyer, despite the completion of the project according to the construction timeline.
The case revolves around a homebuyer, Hemambika Subramani, who booked an apartment in Sobha Valley View, a project in south Bengaluru. The buyer claimed that Sobha Limited failed to hand over possession due to the attachment of the project land by the Income Tax Department under the Prohibition of Benami Property Transactions Act.
Sobha Limited, in response, argued that the project was completed within the stipulated time frame, obtaining the necessary certificates, and was ready to hand over possession. However, due to ongoing land litigation, the Income Tax Department attached the project land, preventing any transfer or dealings with the property.
Despite Sobha Limited’s completion of the project, KRERA sided with the homebuyer, stating that the developer failed to fulfill its agreement with the buyer regarding possession. Citing a Supreme Court judgment, KRERA emphasized that if a developer fails to provide possession within the agreed timeline, the allottee has an unqualified right to seek a refund with interest under the RERA Act.
The Authority acknowledged the ongoing litigation around the project, noting that it posed a threat to the homebuyer’s investment and dreams. Consequently, KRERA ruled in favor of the homebuyer, directing Sobha Limited to refund the entire amount with interest.
This case sets an intriguing precedent, highlighting the importance of adherence to timelines and agreements even in the face of unforeseen circumstances. It underscores the commitment of regulatory bodies to safeguard the rights and interests of homebuyers in the real estate sector.