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Builder cheated by making false promise: Can I claim refund?

Shivendra Pratap Singh

Advocate

06/07/2021

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Question: Builder cheated by making a false promise of giving possession in November 2022. However, possession is expected in 2025. I have booked an apartment in Chennai. During my site visit, I was welcomed by a salesperson who explained to me details about the project and showed me a timeline saying that the property will be handed over to me at 2022 November. I also have an email from the same timeline. Hence i paid the advance amount of 1 lakh and later paid a booking charge of 6.25l.

Now, as per their payment pattern, they want me to pay 50 percent of the flat rate for the agreement stage. And they were stressing me to pay out the 50 percent which is 37 lakhs within a month of my booking or else i will have to pay a penalty. As i have planned to buy this house on a home loan and due to the current pandemic situation, it’s taking time.

They were not willing to give me time and asked to pay my part of the amount which is rs. 13 lakh in a week. I even paid 3 lakhs. As i got stressed out, i started exploring the project details in rera where i found that the given time for completion of the project is 2025 august which is 3 years from the planned timeline which they have provided to me.

When I asked about the same, the answer was, it’s like that in RERA but we will complete it by 2020 November. Now, they have drafted an agreement and as my loan is about to be sanctioned. I thought of signing the agreement and when i checked the same, even in the agreement the time mentioned is august 2025.

Now I don’t want to get into this project anymore. I have not signed the agreement yet.  I just want to know whether i would get my refund of the amount (10.25L) that i have paid if i back out now because of their false promise.

Question from: Tamil Nadu

You have evidence (email) that the builder was promised to give possession in November 2022. But at the time of booking the builder knew that the actual time for completion of the project is 2025. Builder had the intention to cheat therefore, made a false promise and induced you to book the flat. 

You have a right to cancel the booking and claim a refund of the entire amount with interest. Section 18 of RERA gives such a right to buyers. Furthermore, Section 19 of RERA empowers the buyer to know the stage-wise time schedule of completion of the project. Hence, time is the essence for real estate projects. 

File a complaint in the RERA authority

The builder has concealed this important fact and fraudulently took money from you in the form of a booking amount. There is a fault on the part of the builder/promoter. Thus you have a right to exit from the project and claim a refund from the builder.

From the above mentioned material facts, it is revealed that Promoter has failed to give possession as per due date to Allottees and Allottees demanded the refund. Promoter is liable to refund the amount along with interest as per Section 18 of RERA as Allottees decided to withdraw from the project.

Mrs. Jyoti K. Narang,Mr. Kishore L. Narang v. CCI Projects Pvt. Ltd

You should file a complaint before the RERA Authority under Section 18 & 31 for the refund of money. You have sufficient evidence to prove the cheating of the builder and his inability to give possession of the flat in November 2022. This evidence is sufficient to claim refund of money with interest.

shivendra pratap singh advocate

Shivendra Pratap Singh

Advocate

Practising lawyer in the High Court Lucknow. You can consult on Criminal, Civil, Matrimonial, Writ, Service matters, Property, Revenue and RERA related issues.

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