RERA ON LEASE AGREEMENTS

The Bombay High Court while deciding the case of Lavasa Corporation that is developed under the township project in the Pune stated that RERA needs to apply for the cases based on the long-term agreements.

The court has held that RERA applies to the said case wherein the citizens are seeking compensation due to the delay in having 3 flats in Lavasa Township as they have paid more than 80% of the purchase price to the builder and the project is yet to be completed.

Lavasa Corporation filed the appeals challenging the orders that have been passed by Maharashtra RERA Appellate Tribunal this year. Under the RERA Act, minimum of 70% of buyers’ money is kept in a separate account. Money is the said account is to be used by the builders to easily enable the construction on the land that is related.

The appeal of Lavasa Corporation was aimed at claiming relief on the ground that neither the provisions of RERA apply in the case of Lease Agreements nor does the definition of 'promoter' include the term 'lessor' under the Act.

The argument of Lavasa Corporation was regarding the relationship of the company with the persons that "lessor and lessee". Their main contention was that there has been no sale or transfer of title of Apartments.

The High Court stated that the legislative intent could not be excluded based on the argument on long-term lease as it would defeat the purpose of the law. The execution of Lease Agreements by the developers is an act to conveniently escape the clutches of the Act's provisions.

The main objective of RERA is to ensure accountability and to provide comprehensive, speedy remedy and effectiveness to the aggrieved persons.

The HC considered the fact that 80% of the purchase price has already been paid which amounts to sale of the apartment. The Bombay High Court ultimately ruled that the provisions of Maharashtra Real Estate Regulatory Authority shall apply to the long-term lease agreements and that the Authority has its jurisdiction in such matters.

The court further held that 3 people in the particular cases can avail the remedy that is provided under section 18 of the Act to seek the refund alongwith interest and compensation.

Comments

RERA Awards Rs. 65 Lakhs Compensation to Homebuyer for 9 Years Delay in Flat Possession

CA Ramesh Agrawal In a recent decision, the Haryana Real Estate Regulatory Authority (HRERA) has directed a builder to compensate a homebuyer with ₹65 lakh for an inordinate delay of over nine years in handing over a flat in Gurugram. Key Highlights: Background of the Case : The homebuyer had booked a flat in 2013, with the developer promising possession within a stipulated timeframe i.e., 7 th December 2015. However, the possession was delayed by more than nine years. Developer's Justifications : The builder attributed the delay to unforeseen circumstances, including the COVID-19 pandemic, the demise of the chairman of environmental impact assessment (EIA) committee, and inadequate water supply. H-RERA's Verdict : After reviewing the case, HRERA rejected the developer's justifications, deeming them insufficient to warrant such a prolonged delay. The authority emphasized that the reasons cited did not qualify as fo...

RERA SHOULD BE ABOLISHED - SUPREME COURT

CA Ramesh Agrawal On 12 th February 2026, the Supreme Court expressed serious dissatisfaction with the functioning of the Real Estate Regulatory Authority (RERA), indicating that the institution, should be abolished in its current form. In this regard please note: - The Hon. Supreme Court strongly criticized the current functioning & working of RERA and observed that RERA should be abolished in its existing form & there is a need to rethink the role being played by it. The Apex court urged all States to examine who is actually benefiting from RERA’s functioning. The Bench comprising of Chief Justice of India (CJI) Surya Kant and Justice Joymalya Bagchi observed that RERA is helping defaulting builders rather than effectively protecting homebuyers or fulfilling its intended objectives. The Bench emphasized that States should revisit the original purpose behind the enactment of the RERA Act. As quoted by Bar and Bench, CJI Surya Kant stated “ All States should now think of...

Supreme Court Ruling Warns Homebuyers: Registration Is Not Ownership

CA Ramesh Agrawal The Supreme Court in a significant ruling has stated that only registering a property does not make someone its legal owner. The judgement, delivered in the Mahnoor Fatima Imran vs M/s Visweswara Infrastructure Private Limited case, has direct implications for millions of Indian homebuyers and investors. If someone has bought a property solely based on a registered sale deed, then have a look at the below points. Understanding the Law: Registration Does Not Equal Ownership “Ownership of a property comprises several aspects, of which registration is only one,” says Mr. Harsh Parikh, partner at a Law Firm, Khaitan & Co. Under Indian law, properties above Rs. 100 require registration, but that’s not all. “A buyer must also prove full payment, possession, and custody of original title documents,” he explains. Chairman and Director of Prime Developments, Mr. Rakesh Malhotra stated that “Registration provides prima facie evidence of a transaction, but it doesn’t c...

RERA Master

Search This Blog