Mumbai: High Court grants some relief to Lodha Developers, quashes compensation order for New Cuff Parade project

In a reprieve for Lodha Developers, the Bombay High Court recently quashed the orders passed by an adjudicating officer, who had ordered the developer to cough up heavy amounts as compensation to the a man, who had bought one of the flats in the New Cuff Parade project at Wadala.

A bench of Justices Kamalkishor Tated and Riyaz Chagla held that the adjudicating officer erred in holding that the RERA laws are applicable on the developer's project at Wadala.

Notably, the adjudicating officer had

concluded that since the project was a “luxury project”, the developer ought

to have avoided a situation where the service ducts are passing through the bedrooms. Accordingly, a compensation of Rs two lakh was granted to the flat purchaser - Sanjay Phulwaria. The officer had also directed the developer to pay Rs 2.70 lakh for deficit carpet area.

The judges noted that the project was not registered with the RERA as it had received a part Occutpation Certificate (OC) prior to the implementation of the law, which was brought into force in 2017.

Senior counsel Sharan Jagtiani for the Lodha group argued that the adjudicating officer did not consider the verdict of a full bench of the RERA tribunal that had initially held that the RERA laws do not apply on the New Cuff Parade project. The full bench had considered the fact that prior to the enforcement of the law the project was completed up to 40th floor and had received a part OC.

On the other hand, the complainant flat owner of the project, claimed that the part OC couldn't be considered and the project ought to be registered as mandated under the RERA law.

The bench led by Justice Tated, however, considered Jagtiani's submissions that since the New Cuff Parade project isn't registered with the RERA the adjudicating authority couldn't have had passed such an order.

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