MahaRERA Tribunal Sentences Neptune Ventures Promoters to 3 Months Jail for Failing to Compensate Buyer

The Maharashtra Real Estate Appellate Tribunal (MahaRERA) has sentenced three promoters of Neptune Ventures and Developers to three months of civil imprisonment for not following its 2021 order. The order required them to pay interest to Lower Parel resident Atul Prabhu for delaying possession of a flat in their Bhandup project.

The tribunal had instructed the developers to pay almost ₹5 lakh in interest to Prabhu from July 1, 2017, until the flat was handed over, as per Rule 18 of the Maharashtra Real Estate Act. It also ruled that the ₹4,32,697, which the developers claimed as rent adjustment, could not be considered valid compensation under the Maharashtra Ownership Flats Act (MOFA) or RERA.

Prabhu had initially paid ₹51,000 in 2009, and the project got its commencement certificate (CC) in 2013. After making additional payments, the final sale agreement was signed in September 2013, which promised possession by December 2016, with a six-month grace period. However, by June 2017, possession was still not given, and the promoters failed to provide valid reasons for the delay.

The developers blamed the delay on issues like getting permissions, financial problems, and changes in Development Control and Promotion Regulations (DCPR). But the court found these excuses unsupported and noted that changes in DCPR were prospective and did not affect the project’s original timeline.

The developers claimed they offered possession in October 2018, but the tribunal rejected this, calling it baseless and unsupported by evidence. The buyers proved that possession was never actually given and that the promoters had backdated a possession letter in November 2018, which the tribunal deemed fraudulent.

Advocate Nilesh Gala highlighted that, despite the tribunal’s order, the Mumbai suburban collector had not submitted a compliance report about attaching the promoters’ movable and immovable properties.

A new attachment warrant was issued on September 27, 2024, asking the collector to attach the properties and provide a report. However, the collector failed to act, prompting the tribunal to demand an explanation for this inaction.