K-Rera Directs BDA to Pay Rs 56 Lakh as Interest to Complainant
The Karnataka Real Estate Regulatory Authority (K-Rera) has dealt a significant blow to the Bangalore Development Authority (BDA) by directing it to pay Rs 56 lakh as interest to a complainant, Mridula Krishnapur, for the delay in providing basic amenities at Nadaprabhu Kempegowda Layout (NPKL).
Background of the Case
- Mridula Krishnapur purchased a site in 8th Block of Sector-B of NPKL in Kengeri hobli for Rs 96.9 lakh under a lease-cum-sale deed on June 10, 2020.
- She was allotted the site on October 11, 2018, and paid the full amount by February 5, 2019.
- BDA issued a possession certificate on June 16, 2020, but the site was handed over without basic infrastructure.
K-Rera's Ruling
K-Rera held that merely executing the sale deed and handing over possession was insufficient without providing basic infrastructure. The authority observed that ownership was transferred, but the allottee could not use the property or build a house in the absence of essential amenities.
"To have a cosy house is everyone's dream. To fulfil that dream, one could take the risk of investing all lifetime savings and raising loans in terms of lakhs or crores, which could take the rest of life to repay. That being so, (if) the developer ... resorts to using the hard-earned money of investors in a reckless manner, it would not only shatter the dreams of investors, but also make them run from pillar to post by incurring heavy investment as well as legal expenses," the authority said.
Order to Pay Interest
While the complainant claimed Rs 68.8 lakh in interest, the authority bench, comprising chairman Rakesh Singh and member GR Reddy, on April 8 ordered BDA to pay Rs 56 lakh as interest on the delay period calculated from June 10, 2020 to February 2, 2026, within 60 days.
"The authority also ruled that BDA qualifies as a 'promoter' under Rera Act, making it liable for delays and deficiencies. The interest from February 3 till the date of completion of basic amenities will be calculated likewise and paid to the complainant," the authority added.
Implications of the Ruling
The ruling comes as another major blow to BDA, with K-Rera earlier flagging the NPKL project as lapsed last year. The authority's decision is expected to have significant implications for the real estate sector in Karnataka, with developers now liable for delays and deficiencies.