Section 12 of the Real Estate (Regulation and Development) Act, 2016 (“RERA”) provides that if any person making an advance or deposit on the basis of the information contained in the notice, advertisement or prospectus or on the basis of any model apartment etc, sustains any loss or damage by reason of any incorrect false statement included therein, he shall be entitled to compensation from the promoter or if such person intends to withdraw from the project, he shall get the refund of his entire investment with interest and compensation as prescribed.
In the matter of The Bombay Dyeing & Manufacturing Company Limited V/s Ashok Narang and Ors., the Bombay High Court (“Court”) in its judgment dated 30th August 2021, relied on the precedent in the case of Neelkamal Realtors Suburban Private Limited and Anr. Vs. Union of India & Ors (“Neelkamal Realtors”), the Court held that Section 12 (similar to Section 18) of RERA is quasi retroactive in nature and would apply to representation made and agreements entered between promoters and homebuyers prior to coming into force of RERA. This judgement clarifies that Section 12 of RERA applies to obligations of the promoter regarding the information given and the representations made prior to the registration of the project under RERA as ongoing project.
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