In a significant interim order that underscores the importance of fair practices in real estate transactions, the Telangana Real Estate Regulatory Authority (TGRERA) has pulled up a Hyderabad-based builder for Agreement Cancellation—specifically, for unilaterally cancelling a sale agreement and attempting to repossess a flat that had already been substantially paid for by the buyer.
The case pertains to M/s Ayyanna Infra Pvt Ltd, developers of the Ayyanna Prima project located in Guttala Begumpet, Serilingampally Mandal, Hyderabad. The complainant, Adi Vanaja, filed a petition before the authority stating that the builder had cancelled the sale agreement for Flat No. 801, which included three car parking spaces and an undivided share of 105 square yards, without following due legal process.
Buyer Paid ₹3.45 Crore, Builder Sent Cancellation by Email
According to Vanaja, she had already paid ₹3.45 crore for the property, as evidenced by two registered sale agreements dated January 30, 2021. However, on September 14, 2023, the builder sent a cancellation email—not directly addressed to Vanaja, but to her husband—claiming that she had failed to follow the payment schedule.
Vanaja disputed the builder’s claim, asserting that no prior notice was issued and that no refund was initiated, not even as per any forfeiture clause. The TGRERA, after reviewing the agreements, found that there was no specific clause outlining the termination process in the agreements.
TGRERA: Cancellation Invalid, Agreement Still Legally Binding
In its interim order dated May 2, the Authority, led by Chairperson Dr. N Satyanarayana and members K. Srinivasa Rao and Laxmi Narayana Jannu, ruled that the agreement could not be considered terminated. The email sent by the builder was found to be legally insufficient, particularly as it was not directly addressed to the complainant.
“The purported cancellation email was not directly addressed to the complainant and cannot be considered valid under the law. Therefore, prima facie, the agreement continues to subsist,” the order stated.
Interim Relief and Status Quo Ordered
To protect the complainant’s rights during the adjudication process, the Authority issued the following directives:
- The builder is restrained from selling, transferring, or mortgaging Flat No. 801 or creating any third-party interest in the said property.
- Ayyanna Infra Pvt Ltd is ordered to maintain status quo with respect to the property.
- The builder must comply with all statutory obligations required for the completion of the project.
The TGRERA emphasized that creating any third-party rights over the property would cause irreparable harm to the complainant and compromise her legal standing.
Significance of the Order
This ruling sends a strong message to developers about adhering to contractual obligations and legal procedures. It also reinforces the protection provided to homebuyers under the Real Estate (Regulation and Development) Act, 2016, which mandates transparency, accountability, and fairness in builder-buyer agreements.
