RERA Freezes Builder’s Bank Accounts and orders Enquiry

“It was brought to the notice of the authority that on the site, work stands still from many years as per submission of counsel for the complainant. He also requested that authority may initiate enquiry into the affairs of the promoter of this project under section 35 of the Act 2016. The authority decided to appoint Shri Ramesh Kumar Enquiry Officer of the authority to enquire into the affairs of the promoter regarding this project. The Enquiry Officer shall also report about the compliance of the obligations by the promoter regarding project and more specifically regarding having 70% of the total amount collected from the allottee of this project minus the proportionate land cost and construction cost whether deposited in the separate RERA account as per the requirement of the Act 2016 and Rules, 2017.

Further, the counsel for the complainant made a request that account of the project shall be freezed so that in case authority decides to allow refund due to discontinuation of the project or the project stands still or no further progress even after lapse of reasonable period after entering into BBA (as no due date of possession has been mentioned and keeping in view the judgment passed by the Hon’ble Supreme Court in case titled as Fortune Infrastructure and Ors. Versus Trevor D’Lima and Ors (12.03.2018) this period for delivery of possession may be taken as 3 years) to safeguard the interest of the allottee. The authority for the purpose of discharging its function under the provisions of this Act or Rules or regulation made thereunder hereby directs the promoter to submit report of the status on the project alongwith:- 1. Interim RERA Panchkula issued a registration certificate for the above project being developed by M/s Vatika Limited in the form REP-III as prescribed in the Haryana Real Estate (Regulation and Development) Rules, 2017 vide registration no. 213 of 2017 on 15.09.2017 valid upto 15.09.2025 under section 5 of the Act ibid. But inspite of lapse of more than 4 years since grant of registration, It was alleged by the counsel of complainant that there is no physical work progress at site except for some digging work and appears to be abandoned project. No quarterly progress report is being filed by the promoter giving the status of work progress required under section 11 of the Act, 2016.

2. The license no. 91 of 2013 granted by DTCP has expired on 26.10.2017 and the same is not yet renewed/revived, while BBA has been signed declaring the validity of license. It becomes amply clear that the promoter is not only defaulting/omitting in discharge of its obligations under the Real Estate (Regulation and Development) Act, 2016 but at the same time, violating the provisions of the Haryana Development and Regulation of Urban Area, Act 1975 also.

3. The authority directs the respondent to furnish the details of bank account along with the statements of all the accounts associated with these promoters.

4. In order to safeguard the interest of the allottees and keeping in view the above facts, the authority exercising its power under section 36 of the Act, directs the promoter’s M/s Vatika limited to stop operations from bank accounts of the above project namely “Turning Point”.

5. Therefore, the banks are directed to freeze the accounts associated with the above-mentioned promoters in order to restrict the promoter from further withdrawal from the accounts till further order.
The Enquiry Officer shall also report on the above issues.

The authority is satisfied that an act in contravention of this Act or the Rules and Regulation made thereunder has been committed and continues to be committed as the promoter has failed to deliver possession on the due date, the BBA having been entered at variance with the model BBA as provided in the Haryana Rules of 2017, no quarterly progress reports having been filed, no annual statement of audit of the project accounts submitted with the authority etc. the authority hereby orders to restrain the promoter from withdrawing any fund from the project account or from the accounts wherever the money collected from the allottee has been deposited in violation of provisions of the Act in any account except the master account, RERA account or free account and authority considers it necessary to issue such directions in the interest of the allottee.

The proxy counsel present on behalf of the respondent was asked to immediately convey the directions of the authority to the promoter and the concerned bank branches.

The Enquiry Officer to submit his report within 10 days i.e., by 22.08.2022. The promoter is directed to make available books of accounts and other relevant documents required for enquiry before the Enquiry Officer on 17.08.2022 at 11.00 AM in the office of the authority. The company Secretary and Chief Financial Officer and the officer responsible for day-to-day affairs of the project also to appear before the Enquiry Officer who is conducting enquiry on behalf of the authority and summons in this regard be issued to them exercising powers of the Civil Court under the Code of Civil Procedure 1908 read with section 35 (2) of the Act, 2016.

The concerned officers are also directed to bring along the record of allotment and status of the project. The Enquiry Officer shall be assisted by Shri. Shashank Sharma, Engineer Executive. The registry is directed to do the needful immediately. The counsel for the complainant also alleged that at the time of entering into BBA, the allottees were wrongly informed about having a valid license from the DTCP on the date of signing BBA.

The counsel for the complainant was asked to submit his written submission as why he is seeking full refund in spite of due date not yet lapsed. Matter to come up on 30.08.2022 for further proceedings.”

The following is the link for the order:
This order is with reference to the following cases:

Ashish Malhan vs. Vatika Limited

Case Number Case Title
CR/173/2021 Ashish Kumar Aggarwal vs. Vatika
CR/221/2021 Mukta Singh and Anr. vs. Vatika Limited
CR/314/2021 Kapil Tiwar and Ors. vs. Vatika Limited
CR/315/2021 Rahul Arora and Anr. vs. Vatika Limited
CR/318/2021 Rishabh Rohit Jain and Anr. vs. Vatika
CR/403/2021 Sudhir Nayyar and Anr. vs. Vatika
CR/404/2021 Rahul Sahi and Anr. vs. Vatika Limited
CR/413/2021 Ayush Vardhan Agarwal vs. Vatika
CR/567/2021 Ruchir Chawla and Anr. vs. Vatika
CR/1905/2021 Ketav Sharma vs. Vatika Limited
CR/1908/2021 Arvind Pandey and Anr. vs. Vatika
CR/4655/2021 Ashish Kumar Dhimam and Anr. vs Vatika
CR/4698/2021 Arun Sharma and Anr. vs Vatika Limited
CR/4700/2021 Madan Singh and Anr. vs Vatika Limited
CR/4736/2021 Biswajit Acharya and Anr. vs. Vatika
CR/4760/2021 Himanshu Pachauri vs. Vatika Limited

Advocate for the complainants
Deepak Jain and Abhijeet Gupta

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