Authority: High Court of Judicature at Bombay, Civil Appellate Jurisdiction

Order Date: 28 September 2026 (reserved on 17 September 2026)

Case Overview

  • Parties: Appellants – Sanklecha Constructions Pvt. Ltd., Vijay Kachardas Sanklecha, Dilip Kachardas Sanklecha, Puneet Ajit Sanklecha; Respondents – Nitin Madhukar Shewale, Shital Nitin Shewale, Bhimashankar Laxman Janmali, Shrikrishna Laxman Janmali, Sitabai Laxman Janmali, Pushpa Jaggannath Janmali, Devemdra Jaggannath Janmali, Anil Laxman Janmali, Dinkar Laxman Janmali.
  • Interim Application: No.7869 of 2025 (for stay) filed by the appellants.
  • Statutory Basis: Appeal filed under Section 58 of the Real Estate (Regulation and Development) Act, 2016 (RERA).
  • Background: The allottees booked Flat No.702, Building C‑1 in the “Waterways” project (Nashik) for a total consideration of Rs 43,13,200, paying Rs 22,58,178. Agreement for Sale dated 16 May 2016 stipulated possession by 31 December 2017, subject to force‑majeure extensions.
  • Complaint: Allottees filed Complaint No.CC001000000000102 with MahaRERA in 2019 under Section 31 of RERA.
  • MahaRERA Order (24 Aug 2021): Allowed withdrawal, directed refund of the entire amount with interest from 1 January 2018, but gave the promoter an option to pay after obtaining an Occupation Certificate (OC) or earlier, with interest calculated from the date of payment.
  • Appellate Tribunal (AT) Proceedings:
  • Appeal No. AT006000000053455 of 2021 filed by the allottees.
  • AT Order dated 7 Nov 2023 deleted the OC‑option and directed refund within 23 days with interest from the date of receipt at SBI MCLR + 2%.
  • Review Application No.14 of 2023 filed by the promoter; Review Order dated 28 Nov 2024 deleted the “interest from date of receipt” clause, leaving refund with interest from 1 January 2018.
  • Second Appeal (Stamp No.8825 of 2025): Promoters challenged the absolute nature of the refund obligation and the withdrawal of the OC‑option.
  • Substantial Questions of Law Framed:

1. Whether the refund obligation under Section 18(1) is absolute or allows discretion for mitigating circumstances.

2. Whether observations in paragraph 25 of Newtech Promoters are obiter dicta and whether findings in Neelkamal Realtors continue to apply.

3. Whether the authority may condition refund on obtaining an OC.

Submissions

  • For Appellants (Mr. Pungaliya):
  • Argues that the AT erred in removing the OC‑option; the promoter is willing to refund after obtaining OC.
  • Claims the Apex Court observations in Newtech Promoters are obiter and not binding.
  • Cites mitigating circumstances and project completion percentages (two buildings 95% complete, one 85% complete, Building C‑1 70% complete).
  • Points out that Section 18 came into force after the sale agreement (May 2017) and project registration (19 Aug 2017), so contractual obligations pre‑date RERA.
  • Relies on Neelkamal Realtors (para 137) and Career Institute Educational Society for the view that discretion is permissible.
  • For Respondents (Mr. Kapadia):
  • Maintains that Section 18 gives an unqualified right to refund on demand; no discretion is available.
  • Asserts that Newtech Promoters observations are ratio decidendi, not obiter.
  • Argues that the OC‑condition is impermissible and that the promoter must refund immediately with interest as prescribed.

Court’s Consideration

  • Interpretation of Section 18(1): The court held that the language creates an absolute, unqualified right for the allottee to obtain a refund with interest on demand; no provision allows the authority to defer payment.
  • Apex Court Precedent: Paragraph 24 (and 71‑74) of Newtech Promoters are deemed ratio decidendi, establishing the priority and immediacy of the refund right.
  • Division Bench Precedent: Paragraph 137 of Neelkamal Realtors does not permit relaxation for the refund component; it only discusses compensation.
  • Effect of Tribunal Orders: The court concluded that the final operative direction is the MahaRERA order directing refund of the entire amount with interest from 1 January 2018 as per Rule 18 of the 2017 Rules.

Final Outcome

  • The Second Appeal is dismissed; no order as to costs.
  • The interim stay application is disposed of.
  • The directive for the promoter to refund the entire amount received from the allottees with interest from 1 January 2018, at the rate prescribed under Rule 18 of the 2017 Rules, remains valid and enforceable.

Topics: RERA Refund, Real Estate Litigation