The recent flip-flop by MahaRERA on the builder moratorium benefit

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Now, let's dive into today's interesting topic.

Welcome back to an interesting topic to discuss – “the recent flip-flop by MahaRERA on the builder moratorium benefit. This is a story that has left many in the real estate world puzzled and seeking answers."

The June 2023 Modification:

Let's rewind to June 2023 when the Maharashtra Real Estate Appellate Tribunal, or MREAT, made a significant modification to a 2021 order issued by the Maharashtra Real Estate Regulatory Authority, or MahaRERA. This modification addressed a critical question - whether builders should be allowed to claim the benefit of the moratorium period while calculating interest to be paid to homebuyers due to the default of the Builder not being able to give possession on time as agreed.

The ruling was a momentous victory for homebuyers who had filed complaints. It stated clearly that builders could not claim the benefit of the Covid-19 moratorium period while computing the interest owed to homebuyers. The rationale was crystal clear - despite the pandemic-induced extension of project registrations, there had been no change in the possession date. Therefore, it was only fair that interest should be calculated from the date of payment.

This decision was in harmony with the Real Estate (Regulation and Development) Act, commonly known as RERA. It was celebrated as a significant step toward safeguarding the rights of homebuyers who had endured possession delays. MREAT substantiated its ruling with legal precedents and emphasized that interest was compensatory in nature, given the delays suffered by the allottee.

On page 24 of the order para d) The Promoter is not entitled to the benefit of the moratorium for the purpose of calculating the time period for interest liabilities under section 18 of the Act in pursuance to the notifications/orders nos. 13 and 14 dated 2nd April 2020 and 18th May 2020 issued by MahaRERA.

August 2023: A Twist in the Tale:

Now, fast forward to August 14, 2023. MahaRERA passed a perplexing order that appeared to contradict the June ruling of the Appellate Tribunal. This new order granted builders the authority to claim the moratorium period's benefit when calculating interest payable to homebuyers.

This turn of events left many bewildered and, quite understandably, frustrated. How could an authority reverse such a significant decision in such a short span of time? The real estate community, legal experts, and especially the affected homebuyers were left in search of answers.

On page 19 of the order para g. With regard to the payment of interest to the complainants, the MahaRERA further directs that the respondent promoter is entitled to claim the benefit of the “moratorium period” as mentioned in the Notifications /Orders nos. 13 and 14 dated 2nd April, 2020 and 18th May, 2020 issued by the MahaRERA and the Notification/Order which may be issued in this regard from time to time.

Reactions and Opinions:

Let's analyze the reactions and opinions that followed. Firstly, the homebuyers. Their primary concern is the potential impact of this flip-flop. Those who were previously rejoicing over the MREAT's decision now find themselves in a precarious position where they might receive less interest than they had initially anticipated.

Legal experts have also weighed in, debating the consistency and reasoning behind these decisions. Some argue that MahaRERA's latest order could undermine the principles of justice and fairness that were upheld in the earlier ruling. On the flip side, real estate developers might breathe a sigh of relief with the latest order, as it potentially reduces their interest payouts to homebuyers.

Conclusion:

In the world of real estate, where the interests of homebuyers and developers often clash, clarity and consistency in regulations are paramount. The recent flip-flop by MahaRERA regarding whether builders can claim the moratorium period benefit has raised questions about the stability of these regulations.

One thing is certain - this story is far from over. The real estate community will be watching closely to see how this saga unfolds and what impact it will have on the rights and interests of homebuyers and developers alike.

So, stay tuned to our channel for further updates on this interesting and controversial real estate saga. If you think this video is informative, please like and subscribe for more engaging content on real estate and legal matters. And do share with your contacts. See you all again in the next video till then stay blessed, take care stay safe, and stay healthy. Bye Bye Have a Nice Day