Developers liable to pay ‘assured return’ as per deal, says HRERA

The Haryana Real Estate Regulatory Authority (HRERA) Gurugram in a landmark matter has stated that promoters or builders were accountable to pay the Assured/Guaranteed Return as negotiated between the parties in the builder-buyer agreement.
The HRERA, in deciding such 26 instances, made a historic decision addressing the payment of Assured Returns given to allottees by promoters or builders at the time of the agreement for the sale of a real estate unit.
The authority’s bench, led by HRERA Chairman K K Khandelwal, slammed the errant promoters, ruling that the developers or builders were obligated to pay the guaranteed return as negotiated between the parties in the builder-buyer agreement.
The authority, relying on the Bombay High Court’s decision in the Neelkamal Realtors Suburbans case, held that because the Real Estate (Regulation and Development) Act, 2016 does not provide for the re-writing of contractual obligations between the parties, developers or builders cannot claim that there was no contractual obligation to pay the amount of assured returns to the allottees after the RERA went into effect.
The bench stated that if a promoter has a commitment to pay the amount of guaranteed returns to an allottee, he cannot get out of it by claiming that the RERA Act, 2016 or any other law is being enforced.
The authority made it clear in its judgement that in disputes involving assured return schemes, the money was taken as a deposit in advance against allotment of immovable property by the promoters, and possession was to be offered to the allottee within a certain period as mutually agreed upon by them as per the builder-buyer agreement.
By taking a sale consideration in advance, the builder pledged a set amount in terms of secured returns for a specific period of time; therefore, if the builder fails to fulfil his commitment, the allottee has the right to file a complaint with the authority for redress of his grievance. A considerable number of lawsuits have been filed with the HRERA in Gurugram by unhappy allottees who claim that the promoter misled them into investing in the project.

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