In a significant pro-homebuyer ruling, the Maharashtra Real Estate Appellate Tribunal has directed the Omkar group promoters to refund nearly ₹1.15 crore to an NRI homebuyer along with interest, holding that making refund conditional on the builder first selling the flat to a new purchaser is “arbitrary, unreasonable and unconscionable”.
The Tribunal allowed two appeals filed by Dubai-based allottee Rahul Kalyan Raghuwanshi and set aside the 23 February 2022 order of MahaRERA Chairperson that had made the refund subject to the harsh terms of the Allotment Letters.
Case Details
Appeal Nos.: AT006000000083862 of 2022 & AT006000000083863 of 2022 Complaint Nos.: CC006000000195808 & CC006000000196143 Project: Omkar Meridia, Kurla, Mumbai Promoters: M/s Accord Builders, Omkar Realtors & Developers Pvt. Ltd. and Anatomy Realtors Pvt. Ltd. Allottee: Rahul Kalyan Raghuwanshi, Flat No. 507, Executive Tower-M, Business Bay, Dubai, UAE
What the Homebuyer Had Booked
The allottee had booked two flats in Omkar Meridia through Allotment Letters dated 27 February 2015 (Flat B-1008) and 17 July 2015 (Flat A-1001). The total agreed consideration was ₹2,35,30,000 and ₹3,17,82,000 respectively. He paid approximately 20% of the amount — ₹48,73,313 for one flat and ₹66,56,993 for the other.
As per the Allotment Letters, possession was promised latest by April 2017. However, the promoters obtained the Occupancy Certificate only on 27 May 2018, and possession was never handed over. Crucially, despite receiving substantial payment, the promoters never executed a registered Agreement for Sale with the allottee.
The Core Dispute
When the parties exchanged drafts of the Agreement for Sale, the allottee found several discrepancies that deviated from the original understanding in the Allotment Letters. He repeatedly asked the promoters to correct the drafts. Instead of addressing the objections, the promoters insisted on payment of the balance consideration.
The allottee showed willingness to pay once the corrected drafts were provided. When the promoters failed to do so, he treated it as a breach and sought refund of the amounts paid.
The promoters, on the other hand, issued termination notices in November 2018 citing Clause 12 of the Allotment Letters and claimed forfeiture and adjustments.
What MahaRERA Had Ordered
MahaRERA held that the allottee was entitled to refund. However, it directed that the refund would be subject to the terms and conditions of the Allotment Letters. This effectively meant the promoters could delay refund until they found a new buyer for the flats and recovered the full sale proceeds, while also making deductions and forfeitures as per the one-sided Clause 12.
The Controversial Clause 12
Clause 12 of the Allotment Letters stated that upon termination:
- Refund would be made only after the unit is allotted to a new purchaser and full payment is received from the new buyer.
- Promoters could deduct service tax, VAT, and other amounts.
- They could forfeit 10% of the purchase price + costs + brokerage as “liquidated damages”.
- They could also charge interest at 1.5% per month on the amounts paid by the allottee.
The allottee argued that this clause was heavily loaded in favour of the promoters and rendered any refund order meaningless.
Tribunal’s Strong Observations
The Appellate Tribunal, comprising Chairperson Justice S.S. Shinde and Member (A) Dr. Rajagopal Devara, held that such one-sided and unfair clauses cannot be enforced against homebuyers.
Relying on the Supreme Court judgment in Pioneer Urban Land and Infrastructure Ltd. vs Govindan Raghavan (2019) and its own earlier decision in Dinesh R. Humane vs Piramal Estate Pvt. Ltd. (2021), the Tribunal observed that where there is unequal bargaining power and the allottee has no meaningful choice but to sign standard printed forms, unreasonable clauses will not be enforced.
The Tribunal noted that the promoters had already used the allottee’s money for several years. Making refund contingent on the promoters finding a new buyer (an event entirely within their control) was arbitrary and against the spirit of RERA.
It further held that the promoters had violated Section 4(1) of the Maharashtra Ownership of Flats Act (MOFA), 1963 by failing to execute a written Agreement for Sale despite accepting advance payment. Under Section 18 of RERA, the allottee has an unconditional right to refund with interest when the promoter fails to deliver possession as per the agreed timeline.
Final Order of the Tribunal (Pronounced on 1 July 2026)
- Both appeals are allowed.
- Promoters are directed to refund ₹48,73,313 and ₹66,56,993 to the allottee.
- Interest to be paid at State Bank of India’s MCLR + 2% from the respective dates of payment till final realization.
- Promoters to pay ₹25,000 as costs to the allottee.
- Copy of the order to be sent to MahaRERA.
Why This Order Matters
This judgment sends a clear message that builders cannot hide behind one-sided Allotment Letter clauses to deny or indefinitely delay legitimate refunds. Once MahaRERA or the Tribunal finds that a homebuyer is entitled to refund under Section 18 of RERA, the refund cannot be made conditional on unfair contractual terms that defeat the very purpose of the order.
The ruling strengthens the position of homebuyers, especially NRIs, who often face difficulties in following up on projects and are forced to accept standard printed booking documents.
Also Read: RERA Asks Builder To Reimburse Stamp Duty & Taxes
