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Avarsekar Realty Pvt Ltd was recently prohibited by the Bombay High Court from selling any of its unsold apartments as of date in a luxurious 42-story high-rise project at Mahim and its other projects until further orders. An attorney and his wife who had reserved a unit in Mahim's Shrishti Sea View in January 2012 petitioned the court for a civil contempt order, which the court granted and postponed to March 27.
As compensation for the delay in taking possession, the MahaRERA had granted interest on the more than Rs 2.5 crore paid toward its acquisition in 2020. After several rounds of litigation petitioners Ashok Paranjpe, a solicitor with the business MDP & Partners and his wife Anita appeared before the HC with the statement that the interest sum due has exceeded Rs 2 crore.
Real Estate (Regulation and Development) Act (RERA), passed in 2016 by the Centre, went into effect in Maharashtra in April 2017. In the same month, Paranjpe filed a complaint with MahaRERA after failing to receive possession of the unit booked, requesting interest from the builder due to the delay in flat possession and invoking a buyer-friendly clause in RERA. The adjudicating officer at MahaRERA ordered the builder to pay the Paranjpes interest at a rate of 10.35% per year on more than Rs 2.5 crore from February 1, 2015, until handing over possession of the apartment, within 30 days, on February 10, 2020. In 2020, the builder appealed to the RERA Appellate Tribunal. On July 7, 2021, his objection was rejected.
MahaRERA issued a "recovery warrant" to the collector on January 5, 2021, following a request from the counsel for the execution and compliance of the order directing the payment of interest. In July 2021, the solicitor filed a complaint with the HC citing the collector's delay and asking for instructions on how to attach and auction the builder's property in the Mahim project in order to recoup the interest amount. The HC issued an interim order in March 2022 directing Avarsekar Realty to reveal its assets and any encumbrances on them. In September 2022, the court dismissed Paranjpes' appeal, concluding that they could bring their complaint against the collector's alleged inactivity to MahaRERA.
The Paranjpes contacted the HC in January of this year, alleging that "no steps are taken against the developer" despite the fact that they had followed with its September 2022 ruling and appeared before MahaRERA. The government's attorney claimed that although some action had been taken by MahaRERA against the developer and some apartments had been put up for sale, no buyers could be found on the scheduled day for the sale. The state requested further time to submit an affidavit outlining the actions taken thus far to carry out the RERA tribunal's order.
The builder was instructed to file a response and disclose how many apartments it has already sold following the RERA tribunal's ruling of July 7, 2021, by the High Court panel of Justices R D Dhanuka and Gauri Godse in an order dated March 8. The HC instructed the builder to specify in the affidavit the amount of money received from the sale of apartments after July 7, 2021, and "indicate as to why... interest and payment... have not been cleared out of sale proceeds."
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