TaxTMI 
TaxTMI 
2024 (4) TMI 1286
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....o forbear the third respondent from continuing with the illegal construction of new towers namely Octavius and Verona in the location of the clubhouse for Phase - II and from marketing/selling the flats in the third respondent's development "House of Hiranandani" situated in Egattur, Chennai without abiding by the original DTCP approved plan in respect of Phase - II, dated 15.06.2012 along with building permit, dated 15.10.2012 which is renewed on 28.01.2016. B. The case of the appellant: 2. The appellant is a society registered under the Tamil Nadu Societies Registration Act, 1975. It is the association of homeowners in Hiranandani Upscale, a residential complex situated at No.5/63, Old Mahabalipuram Road, Egattur Village, Chennai. The third respondent namely, M/s.Hiranandani Developers Private Limited permitted a township proposing to be a gated community project of building integrated tower blocks of apartments of varying sizes under the name and style 'House of Hiranandani' earlier known as 'Hiranandani Upscale'. It is developed over the land measuring 120 acres in phases. The third respondent initially obtained plan approval from the second respondent....
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....twin towers namely, Octavius and Verona. A statutory obligation is cast upon the third respondent to hand over all the common areas to the association of allottees under the provisions of the Real Estate (Regulation and Development) Act, 2016 (hereinafter referred to as 'RERA Act'). The new plan is sanctioned by the authorities in violation of Section 14(2)(ii) of the RERA Act. The homeowners are severely affected because the third respondent did not adhere to the promises made concerning the amenities. Only based on the original plan that they will have the common area, space, number of towers etc., the decision has been made by the homeowners to buy the houses at the price offered by the third respondent and after selling the flats, unilaterally, alteration of plan, abandoning the clubhouse for Phase - II and putting up of two new residential towers to be sold to prospective purchasers, completely violates rights of the homeowners of the appellant Association and hence the Writ Petition. C. The case of the respondents : 3. The Writ Petition was resisted by the respondents. On behalf of the second respondent, the Assistant Director, District Office of Town and Countr....
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....ucture and materials used; (e) quality of building services and amenities in the construction of building; (f) other requirements or licenses or clearances required for the site or premises or activity under various other laws. Therefore, it is the case of the second respondent that it only took into account the title and availability of the land and the floor space index and whether or not the existing residents are entitled to the amenity of the building and whether any other requirement is required is not its lookout as per Rule 11(e) and (f) of the said Rules. 3.3. The third respondent filed an affidavit. In paragraph No.9 of the affidavit, the earlier planning approvals, dated 15.06.2012, 15.10.2012 and 28.01.2016 are all admitted. It is the case of the third respondent that they completed the buildings of Phase - I comprising six towers in the name and style of Seawood, Pinewood, Brentwood, Greenwood, Birchwood and Bridgewood. The third respondent has completed part of Phase - II of the township which comprised seven towers in the name and style of Oceanic, Edina, Bayview, Sinovia, Tiana, Amalfi and Anchorage. The third respondent is in the process of developing Octavius, ....
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....e, the third respondent, in its commercial wisdom, applied to the second respondent and other relevant authorities for revision of plan approval and the impugned plan approval was granted for the development of the said towers namely, Octavius and Verona. 3.6. Even as per the impugned plan approval, the third respondent only sought to move the amenity namely, the clubhouse, behind the said towers, Octavius and Verona. Thus, the clubhouse is as per the directions given in the revised sanction plan. This is, by no stretch of imagination, a withdrawal of common facility by the third respondent. 3.7. Thus, the third respondent does not have to procure a separate No Objection Certificate/consent from each of the allottees including the appellant for the revision. The township is an ongoing project. The third respondent had acted in consonance with Explanation - II of Rule 4 and Section 14 of the RERA Act. The appellant has only 239 residents as part of its association, whereas, the township has more than 2000 occupants and therefore, lacks the requisite majority to present the Writ Petition. The appellant Association is well aware that the clubhouse is presently used by all of its....
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....e Judge found that a reading of recital 'L' and Clause - 10.3 of the construction agreement, the allottees have also specifically consented and empowered the third respondent to file necessary renewal/revision application and therefore the third respondent did not have to procure any fresh consent of two-third of the allottees to act on the revised plan. The authorities have duly taken into account the limitations of permission as contained in Rule 11 of the Tamil Nadu Combined Development and Building Rules, 2019 and the project is taken up in a phased manner and the third respondent is only sought to move the amenity to the new location as proposed in the revised plan. Thus, after proper scrutiny of the documents and requirements, the impugned plan has been granted. 4.3. Further, the learned Single Judge found that the space, in which the clubhouse is originally scheduled to be put up, is not covered in the sale deeds issued to the members of the appellant Association. But, it is shown only as an amenity. No other person owns undivided share in respect of the site, on which, the new clubhouse is to be located. Therefore, the learned Single Judge found no merits in the ....
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....A Act. The learned Single Judge dismissed the Writ Petition mainly on the finding that such consent is not required where the original plan was sanctioned before the coming into force of the Act given the Explanation to Rule 4 of the TNRERA Rules and consent was given through recital 'L' and Clause - 10.3 of the construction agreement. 5.2. The second respondent is duty bound to consider the provisions of the RERA Act more specifically Section 14 which mandates that the developer shall not alter the original sanctioned plan without the prior written consent of two-thirds of allottees in the project and if the project is intended to be developed in phases, then, without the prior written consent of two-third of allottees in the phase concerned. The impugned order did not consider any consent at all. The impugned order is violative of Section 14 of the RERA Act. The term 'common areas' in Section 14(2) of the RERA Act has been defined to include the entire area of the project or the phase as the case may be and also community and commercial facilities. The clubhouse is a community facility as per recital 'K' and Annexure - IV of the construction agreement. ....
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....part of their respective RERA registration. 5.6. The appellant Association claimed that the clubhouse in Building No.37 is a part of their 'phase' based on the brochure. That is a deliberate misreading of the brochure. The brochure promises an amenity and the third respondent is still committing to provide the amenity. The brochure cannot be used to decide the legal definition of the term 'phase'. The third respondent is registering each tower (and appurtenant land) under the RERA Act thereby, making each tower a phase. The same is also in consonance with the planning approval. 5.7. Therefore, the originally proposed clubhouse building is not the common area within the meaning of the Act and that building is not part of the relevant phase of any of the members of the appellant Association. As far as the promised amenities are concerned, there is a blue turtle clubhouse which is open to the members of the association and the other residents. The extent of the Club House area in the old Building No.37 is preserved and is being relocated in the area as indicated in the revised plan. That will also be opened to the members of the appellant Association and the othe....
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.... consent of two-thirds of the allottees. The judgment in Abbotsbury Owners' Association's case (stated supra), relied upon by the learned Senior Counsel for the appellant, is entirely misplaced and is different from the facts of the present case. Therefore, the learned Single Judge has correctly decided the Writ Petition and the same does not call for any interference. F. The Discussion and Findings : 6. We have considered the rival submissions made on either side and perused the material records of the case. 6.1. Firstly, it is admitted that the brochure which is produced at page No.273 of Volume - II of the appeal paper book is the brochure prepared by the third respondent for marketing the apartments in the township. It contains the master plan for the development of the entire township. As per the master plan, Building No.17 is shown as a clubhouse and sports hall for Phase - I and Building No.18 is shown as a clubhouse for Phase - II. However, upon consideration of the detailed floor-wise plan of Building No.18 of Phase - II, it can be seen that only two floors of the said building are proposed as a club house and the rest of the floors/built-up areas are sale....
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....thority is valid for specific term, the Promoter shall be responsible to get the approvals duly renewed /revised, the Allottee hereby give their specific consent and empower the Promoter to file necessary renewal/ revision application with the appropriate authority and to comply with any statutory requirement for such renewal/revisions." 6.4. Clause - 17.2 of the said agreement reads as follows :- "17.2. AMENITIES & FACILITIES The common facilities and amenities of the said Building will be the common amenities of the said Building and common amenities in the Development which are in form of common pathways, open areas shall be common to the said Complex and all the phases thereof, as more specifically given hereunder in Annexure III and Annexure IV." 6.5. The relevant portion of Annexure - IV of the said agreement reads as follows :- "CLUB HOUSE: 1. The Promoter shall provide access to a Club House having facilities such as Swimming Pool, Gymnasium, Squash, Badminton Court, Aerobics center, Spa & Salon, Table Tennis, Tennis Court, Cafe, Locker rooms near sports facilities, etc. and/or such amenities as may be desired by the Promoter. The A....
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....aring that it had completed Phase - I and Phase - II in the year 2020, the third respondent made an application on 28.07.2020, based on which, the impugned proceedings of the second respondent, dated 19.11.2020 were passed, thereby, granting revised plan approval. The details of the blocks that are already built, blocks that are sought to be removed, and the blocks that are newly proposed including the total FSI, and building area are all furnished in the impugned order itself in detail and the parameters containing the overall particulars are reproduced hereunder :- "Site area - 483923.10 sq.m Total FSI area - 1198001.49 sq.m + Non FSI area = 202422.53 sq.m Total building area - 1400424.02 sq.m Total block - 60 Blocks OSR Area 48347.39 sq.m already gifted to local body Details of already built 16 blocks Block 1 to 10 and 11, 11A, 13 and 14 block-34 (School Building) block-35 (Club House) Details of earlier approved building but construction not commenced (27 blocks have been stationed without any change) Block-15B, 17, 19B, 21, 22A, 22B, 23, 25A, 25D, 26A, 26B, 27A, 27B, 28A, 28B, 30A, 30B, 31A, 31B, 40, 44, 45, 46, 46B, 47,....
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....ity. The developers are required to post all project details including the project plan, layout, Government approvals, land status, contractors, schedule and completion of the project with the authority which will then be made available to the consumers/prospective buyers. The Act aims at the protection of the buyers' interests and streamlines the duties and responsibilities of both sides. Penalties are provided for violation. The Grievance Redressal mechanism for speedy dispute redressal of the disputes is also provided under the Act. The RERA Act is intended to achieve the following objective :- "The Real Estate Act is intended to achieve the following objectives: a) ensure accountability towards allottees and protect their interest; b) infuse transparency, ensure fair-play and reduce frauds & delays; c) introduce professionalism and pan India standardization; d) establish symmetry of information between the promoter and allottee; e) imposing certain responsibilities on both promoter and allottees; f) establish regulatory oversight mechanism to enforce contracts; 2 g) establish fast- track dispute resolution mechanism; h) promote good governance in the sector which i....
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....ll, 2013, in the interests of the effective consumer protection, uniformity and standardisation of business practices and transactions in the real estate sector. The proposed Bill provides for the establishment of the Real Estate Regulatory Authority (the Authority) for regulation and promotion of real estate sector and to ensure sale of plot, apartment or building, as the case may be, in an efficient and transparent manner and to protect the interest of consumers in real estate sector and establish the Real Estate Appellate Tribunal to hear appeals from the decisions, directions or orders of the Authority." 9. It was introduced with an object to ensure greater accountability towards consumers, to significantly reduce frauds and delays and also the current high transaction costs, and to balance the interests of consumers and promoters by imposing certain responsibilities on both, and to bring transparency of the contractual conditions, set minimum standards of accountability and a fast-track dispute resolution mechanism. It also proposes to induct professionalism and standardisation in the sector, thus paving the way for accelerated growth and investments in the long run. ....
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....plans and specifications and the nature of fixtures, fittings and amenities described therein in respect of the apartment, plot or building, as the case may be, which are agreed to be taken, without the previous consent of that person: Provided that the promoter may make such minor additions or alterations as may be required by the allottee, or such minor changes or alterations as may be necessary due to architectural and structural reasons duly recommended and verified by an authorised Architect or Engineer after proper declaration and intimation to the allottee. Explanation.--For the purpose of this clause, "minor additions or alterations" excludes structural change including an addition to the area or change in height, or the removal of part of a building, or any change to the structure, such as the construction or removal or cutting into of any wall or a part of a wall, partition, column, beam, joist, floor including a mezzanine floor or other support, or a change to or closing of any required means of access ingress or egress or a change to the fixtures or equipment, etc. (ii) any other alterations or additions in the sanctioned plans, layout plans a....
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....entered into with the prospective buyers without the previous written consent of atleast two-thirds of the allottees. 6.13. Section 84 of the Act confers the power of the appropriate Government to frame rules for carrying out the purposes of the Act. In exercise thereof, the Government of Tamil Nadu has framed rules called the Tamil Nadu Real Estate (Regulation and Development) Rules, 2017. Rule 4 of the said Rules reads as follows :- "4. Disclosure by promoters of existing projects.-(1) On the date of coming into force of sub-section (1) of section 3 of the Act, promoters of all ongoing projects shall within the time specified in the said sub-section, make an application to the Authority in the form and manner provided in rule 3. Explanation I.- Any agreement already entered between the promoter and the allottee before commencement of these rules shall not be affected. Explanation II .- If the project has been conceived to be developed in phases, where the plans for the initial phase are approved by the planning authority prior to the date of coming into force of sub-section (1) of section 3 of the Act, then for such projects the requirement of obtain....
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....f the agreement entered into between the promoter and the allottee to that extent." 6.14. A reading of Section 14(2)(ii) of the RERA Act along with Explanation - II to Rule 4 of the Rules, it would be clear that unless there is consent from two-thirds of the allottees, there cannot be any addition, revision or modification of the plan. Explanation - II only clarifies that if a project is to be developed in phases, the promoter holds out the details of the development of the particular phase to the allottees and there may be excess/rest of the lands which are to be developed in the subsequent phases, in which case, when it develops the subsequent phases, in respect of any addition or revision or modification of the subsequent phases, it needs to take consent from the respective allottees of the subsequent phase alone and the consent of the earlier phase need not be taken. The same is also in sync with the purposes of the Act and Section 14(2) of the RERA Act as all the details of the development in respect of the phases which are to be developed in a later date will not be disclosed to the buyers. In essence, if a promoter discloses the details as to the number of towers, number ....
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.... in the Writ Petition, it is the specific case of the respondents that the two new towers are part of Phase - I. Paragraph No.10 of the counter- affidavit is extracted hereunder :- "10. I state that pursuant to the said Sanctioned Plans, the Third Respondent completed the buildings of Phase I comprising of six towers in the name and style of Seawood, Pinewood, Brentwood, Greenwood, Birchwood and Bridgewood. I state that the Third Respondent has completed part of Phase II of the said Township which comprises seven towers in the name and style of Oceanic, Edina, Bayview, Sinovia, Tiana, Amalfi and Anchorage and is in the process of developing Octavius, Verona, Bayhaven (Phase-I)." (emphasis supplied) 6.18. As per the clause in the construction agreement, it was contended that the entire project is being executed in Phase - I and Phase - II which was extracted supra. Paragraph No.7 of the counter-affidavit filed in the present Writ Appeal is as follows:- "7. I state that after obtaining the relevant sanctions, the 3rd Respondent completed the buildings of Phase I, which comprises of six towers, namely, Seawood, Pinewood, Brentwood, Greenwood, Birchwood and Brid....
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....ude all the community and commercial facilities provided in the Real Estate project, thereby, the entire Building No.18 is a common area. It is pertinent to state here that the entire township is developed as a gated community and each building does not have any access road which is gifted to the local authority. 6.23. On the contrary, the promoter had undertaken upon itself to develop it as a complex with shared facilities and amenities. Therefore, even going by the arguments of the learned Senior Counsel, Mr.Srinath Sridevan, that each of the buildings should be considered as a separate phase by itself, the clubhouse and the commercial complex comprised in Block/Building No.18 is a common area as it is represented as the club and commercial facility for the seven buildings which are originally termed as Phase - II and thus, cannot be altered without the consent of the two-third owners in respect of each of the seven towers. It must be seen that the very purpose of the Act is to prevent the promoters from holding out one thing and thereafter carrying out another. Any purchaser of the apartment in all these seven buildings of Phase - II agreed for a particular price by taking in....
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....s. 6.26. Secondly, such consent is to be with reference to the change which is to be made. Clause - 10.3 of the agreement which is extracted would only be in respect of renewal/revision which may become necessary to comply with any statutory requirements. The same cannot be consent for altering the community facility namely, the clubhouse specifically promised in Annexure - IV to the agreement. 6.27. Section 3 of the Indian Contract Act, 1872 which defines consent is as follows :- "3. Communication, acceptance and revocation of proposals.--The communication of proposals, the acceptance of proposals, and the revocation of proposals and acceptances, respectively, are deemed to be made by any act or omission of the party proposing, accepting or revoking by which he intends to communicate such proposal, acceptance or revocation, or which has the effect of communicating it." Therefore, at the relevant point in time, when it was expressly held out that there would be 6 + 7 residential towers only, it cannot be said that the allottees of the flat have acceded to or consented that the promoter is allowed to put any number of towers or to do away with the clubhouse and com....