2 days ago
Dubai Buyer Wins Full Refund Dispute With Mumbai Builder
A buyer living in Dubai paid money for two flats in Mumbai.
The builder promised the flats by April 2017, but the occupancy certificate came only in May 2018.
The buyer also found that the draft contracts differed from the agreed terms.
He cancelled the bookings and asked for his money back with interest.
The builder said it would repay him only after finding new buyers.
A tribunal said this condition and other deductions were unfair.
It ordered the builder to return the full amounts paid, with interest.
The final interest amount will depend on the applicable bank rates and payment dates.
MahaREAT ordered a Mumbai builder to refund ₹48.73 lakh and ₹66.56 lakh paid for two flats.
The tribunal rejected a clause allowing forfeiture, monthly interest deductions, and repayment only after replacement buyers were found.
The buyer booked the flats in 2015, with possession promised before April 2017, but the occupancy certificate was obtained in May 2018.
MahaREAT found that the builder accepted substantial payments without registered sale agreements, breaching Section 4(1) of the Maharashtra Ownership of Flats Act.
Interest will run from each payment date at the State Bank of India’s highest marginal lending rate plus two percentage points; the estimated total interest is about ₹1.33 crore.
- Who
- A Dubai-based buyer, Raghuwanshi, and a Mumbai builder; the case was decided by the Maharashtra Real Estate Appellate Tribunal.
- What
- MahaREAT ordered a full refund with interest after rejecting the builder’s cancellation and repayment conditions.
- Where
- The dispute concerned two flats in Mumbai, Maharashtra, and was decided by MahaREAT.
- When
- The tribunal decided the appeal on 1 July 2026; the bookings were made in 2015.
- Why
- The buyer alleged delayed possession and differences between agreed terms and draft agreements; the tribunal also found missing registered sale agreements and unfair contractual terms.
Buyer and Tribunal
Builder’s Position
Repayment condition
Buyer and Tribunal
The buyer argued that repayment should not depend on the builder finding replacement purchasers. MahaREAT agreed that such a condition could operate indefinitely and remained within the builder’s control.
Builder’s Position
The builder linked repayment to finding replacement buyers for the flats.
Contractual deductions
Buyer and Tribunal
The tribunal found Clause 12 arbitrary and unreasonable because it allowed forfeiture and interest deductions while providing no matching compensation for delay.
Builder’s Position
The builder relied on Clause 12, which allowed forfeiture of 10% of each purchase price and monthly interest of 1.5% until termination.
Legal protections
Buyer and Tribunal
The tribunal held that delayed possession triggered the buyer’s right to repayment with interest under Section 18 of RERA, and that contractual clauses could not override statutory protections.
Builder’s Position
The builder’s contractual terms were challenged after the buyer cancelled the bookings, but the articles do not report a separate detailed legal response from the builder to the tribunal’s findings.
Key facts
- Flat prices
- ₹2.35 crore and ₹3.17 crore
- Amounts paid
- ₹48.73 lakh and ₹66.56 lakh, or nearly ₹1.15 crore combined
- Promised possession
- Before April 2017
- Occupancy certificate
- Obtained in May 2018
- Refund ordered
- Full repayment of both amounts paid
- Interest rate
- State Bank of India’s highest marginal lending rate plus two percentage points
- Estimated interest
- About ₹1.33 crore at 10.5% annually over 11 years; the actual amount depends on rates and payment dates
Sources
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