Upholds Developer’s Cancellation Of Unit in ATS Marigold As Homebuyer Defaults On Payments
The apartment buyer’s agreement of Jan 21, 2015 promised possession by Jan 21, 2019
Gurgaon: Buyers have been denied any delay interest in a matter pertaining to a flat in Sector 89A, which was promised by Jan 2019 but was offered over four years later. In an order dated Sept 29, Haryana Real Estate Regulatory Authority (HRera) dismissed a complaint against ATS Real Estate Builders after upholding the developer’s cancellation of a unit in ATS Marigold, without computing the delay at all. Reminders followed on July 27, 2023, Nov 22, 2023, and Dec 31, 2023, before ATS cancelled the allotment.Chairman Arun Kumar framed a single question: whether the cancellation of April 2, 2024, was valid. Finding that the homebuyer had defaulted on payments after possession was offered on June 20, 2023, the Authority held it was valid, citing sections 19(6) and 19(7) of Real Estate (Regulation and Development) Act, 2016. Relief was declined.The timeline made the case unusual. The apartment buyer’s agreement of Jan 21, 2015, promised possession by Jan 21, 2019. The occupation certificate arrived only on June 16, 2023. The couple, who had paid Rs 1.1 crore against a basic price of Rs 1.4 crore, sought interest at 11.10%, the prescribed rate.ATS had pleaded that the Act was not retrospective, that clause 6.2 only promised an endeavour to complete construction and that the Covid-19 pandemic, NCR construction bans, groundwater restrictions and contractor disputes were beyond its control. The Authority recorded these defences but did not rule on them, as its finding on cancellation disposed of the complaint.Limitation was another point of interest. The Authority said the law of limitation does not strictly apply to the Act, but held that three years is a reasonable period to approach it, guided by natural justice under Section 38. It counted that period from the cancellation, not from the 2019 due date. The complaint, filed on Sept 4, 2025, was therefore held to be in time, though it came over six years after possession fell due.On the merits, the Authority reasoned that the (OC) proved construction was complete, so the buyers were bound to pay the demand raised with the offer of possession.The order also notes that ATS resold the unit after cancellation, handing possession to a new buyer on Aug 22, 2025, and executing a conveyance deed on Sept 1, 2025, days before the complaint was filed. It further records a refund of Rs 1.2 crore, covering the principal and interest at 10.85%, initiated by demand drafts on Oct 28, 2025, after the complaint was filed.The order does not reconcile the buyers’ claim of over 95% payment with the amounts paid, nor the differing outstanding dues in ATS’s demand letters, from Rs 74,186 to Rs 54.21 lakh.
