Haryana Tribunal protects allottees from retroactive payment mode changes in affordable housing

Saurabh Malik

Chandigarh, February 7

In a significant order, Haryana Real Estate Appellate Tribunal has ruled that the ‘Affordable Housing Policy Amendment of 2019’ cannot be applied retrospectively to alter the payment modes laid down in pre-existing agreements between the promoter and allottees.

“We do not expect the promoter to be harsh to the allottees as we feel that such allottees invest their savings to have roof over their head in the later years of their life. In fact, the affordable housing policy has been framed by the government with this objective in mind. It is inexplicable why the authority (concerned) has not given clear-cut finding on the issue of applicability of the amendment of 2019 in the policy prospectively or retrospectively. The tendency to avoid such issues and circumvent the same needs to be discouraged,” the tribunal added.

Compromising Chairman Justice Rajan Gupta and Member (Technical) Anil Kumar Gupta, the tribunal asserted that the promoter, having entered into a binding agreement with the allottees, could not unilaterally impose new payment terms based on a subsequent amendment.

As such, the demands raised by a promoter citing the amendment of 2019 were deemed invalid.

The tribunal, during the course of hearing, was told that a promoter as per the Affordable Housing Policy of 2013 was to offer the possession of units within validity period of four years from the grant of sanctions and clearances.

It was irrespective of the fact whether the allottee was successful in the first draw or a subsequent redraw. Accordingly, the promoter was under an obligation to offer the possession of the unit at the same time to allottees of the first draw and the subsequent redraw, irrespective of different dates of allotment.

Referring to the facts of the case in hand, the counsel for a promoter submitted that the allottees were allotted unit in the redraw on July 24, 2018.

Logically, the allottees of all the subsequent draws were required to pay in terms of first draw to maintain the parity. This principle stood confirmed by the amendment in policy by notification dated July 5, 2019.

After hearing arguments, the tribunal asserted the amendment could not be applied retrospectively to alter the financial obligations set forth in the pre-existing agreement, considering the legal principle of non-retroactivity of Acts, policies and amendments.

As such, a promoter could not unilaterally impose new payment terms based on the subsequent amendment.

The tribunal added the retrospective application of the amendment had unjustly impacted the allottees to “their detriment”. It had resulted in grave injustice to the innocent allottees, who had already complied with the agreement conditions.

It was well-known that the promoter and allottees did not stand on the same footing and the concept of unequal bargaining power was to be acknowledged, particularly in case of affordable housing policy.