Major Setback for Omaxe as Punjab RERA Imposes Heavy Penalty
In a significant ruling that strengthens homebuyer rights, the Punjab Real Estate Regulatory Authority (RERA) has dealt a substantial blow to M/s Omaxe Chandigarh Extension Developers Pvt Ltd. The regulatory body has directed the real estate developer to pay ₹44,63,919 as delay interest for its delayed 'The Lake' project at New Chandigarh.
Legal Battle Initiated by Senior Bureaucrats
The case emerged from a complaint filed by senior bureaucrats Anil Kumar Sanghi and Sunita Sanghi, who had invested in the residential project. According to their counsel Shahnawaz Khan, the complainants had already paid ₹76,47,972 out of the total sale value of ₹82,11,488 for their property.
The agreement stipulated that possession should be handed over by September 7, 2019, including the grace period. However, the developer failed to meet this deadline substantially. RERA chairman Rakesh Kumar Goyal, exercising powers under sections 31 and 40(1) of the Real Estate (Regulation & Development) Act, 2016, determined that a valid offer of possession was only made on June 27, 2025.
Unilateral Area Increase Declared Illegal
In another crucial aspect of the ruling, RERA struck down Omaxe's unilateral decision to increase the flat's super area from 1885 square feet to 1975 square feet. The corresponding demand calculated at ₹3,690 per square foot was declared illegal and in violation of statutory provisions.
Advocate Shahnawaz Khan emphasized that the authority noted this move contradicted previous RERA rulings and established legal principles. The complainants had also alleged excess charging of ₹30,41,532 due to inflated area calculations and an earlier possession offer issued without a valid occupancy certificate.
Legal Arguments and Precedent Setting
Omaxe's contention that the complaint wasn't maintainable because the allotment pre-dated RERA was firmly rejected by the authority. This aspect of the ruling is particularly significant as it establishes that RERA provisions apply to ongoing projects regardless of when the initial allotment occurred.
The authority calculated the compensation for the delay period from October 1, 2019 to June 27, 2025, arriving at the final amount of ₹44,63,919. Citing the Supreme Court's Newtech Promoters judgment, RERA ordered that the amount be recovered as arrears of land revenue.
Recovery Process and Future Implications
RERA has directed that a debt recovery certificate be issued after 90 days and forwarded to the competent authority under the Punjab Land Revenue Act, 1887. The complainants have been officially declared decree holders while the developer has been designated as judgment debtor for recovery purposes under the RERA Act.
This case, involving senior government officers, is being viewed as a landmark precedent for homebuyers across Punjab. It establishes crucial protections against unilateral area hikes and delayed possession in large housing projects, sending a strong message to developers about compliance with regulatory standards.
The ruling clarifies that merely obtaining an occupancy certificate, which the tower received on November 26, 2024, does not automatically absolve promoters of liability for delays in project completion. This interpretation strengthens consumer protection in the real estate sector and reinforces RERA's role as an effective regulatory body.
