Chennai: Can residential projects sold through lease deeds come under the ambit of the real estate act?
The Tamil Nadu Real Estate Regulatory Authority (TNRERA) has entertained an application over a leased property, ordering the developer to return the payment of a homebuyer as the project reminds a non-starter.
The case concerns a project called ‘UTSAV’, contracted by New Chennai Township Pvt Ltd at Vellur in Cheyyur Taluk of Kancheepuram District. In a recent order, G Saravanan, an adjudicating officer of TNRERA, said R Thenmozhi and S Sriram booked a flat and paid an advance for it in February 2011. The developer had made a lease deed in support of the complainants for leasing a flat for a period of 99 years that was to be built by the former. While the total lease fee was Rs 16.69 lakh, the homebuyers had paid Rs 12.82 lakh. The possession of the flat was set within 3-months from the date of receipt of the entire lease amount, as per the deed that was registered a year later in 2012. Though 80% of the total fee of the lease value of the flat was paid, the order stated that the developer neither started construction work nor handed over the possession of the apartment so far.
The complainants circulated a notice in 2016 to cancel the lease deed and asked for a refund of the entire amount with interest. But, the developer failed to repay the amount. The complainants have taken bank loans to make their payments, who are allowed to relief,” the order added.
As per the order, the complainants are entitled to return of Rs 12.82 lakh with interest at the rate of 10.15% for the amount paid from the date of payment till repayment by the developer. The order further stated that “considering the facts and circumstances of the case, Rs 1 lakh is fixed as compensation towards mental agony and inconvenience caused to the complainants by the developer”. Towards registration and litigation expenses, Rs 16,790 and Rs 20,000 respectively have been given.
TNRERA also ordered the developer to refund the amount, interest, compensation and costs within 60 days. The order further added, “The complainants shall execute the cancellation of lease deed on the satisfaction of their claims at the cost of the developer”.