HRERA Jails Realty Developer for Failing to Refund Rs. 26 Lakh

A real estate company's promoter was given a one-month civil jail sentence by the Gurugram bench of the Haryana Real Estate Regulatory Authority (HRERA) for neglecting to reimburse an investor in a commercial real estate project in Sector 89 for Rs. 26.07 lakh.

Rajender Kumar, the HRERA Adjudicating officer, issued the decision, claiming that the developer had not complied with earlier instructions or even provided a response. Additionally, the decree mandated that on April 16, 2025, the judgment debtor (JD) appear before the HRERA forum.

The Ghaziabad resident and complainant, Sohan Lal, had spent Rs. 26 lakh on a 5.5-acre commercial property that was created by the aforementioned real estate company. According to the order, the developer had received the license from the Department of Town and Country Planning in 2008.

According to the terms of the sale agreement, the investor was guaranteed a return of Rs. 27,000 per month until possession was granted, and possession was promised within 36 months. But the promised returns were never paid, and there was no sign that the 300-square-foot store would be turned over anytime soon.

As stated in the court decision, Sohan Lal addressed HRERA, frustrated by the delay, and expressed his desire to end the indefinite waiting period for possession.

HRERA found in favor of the complainant on November 15, 2023, ordering the developer to return the full investment amount plus interest at a rate of 10.75% annually from the date of each installment until the refund was actually made. Adjustments for any payments already made toward guaranteed returns were also permitted by the decision.

Nevertheless, the developer did not return the money or answer the court's summons in spite of the legal order. HRERA chose to take severe action by sending the developer's director to civil prison for a month, citing noncompliance with its execution order.

Rajender Kumar, HRERA Adjudicating Officer says, “This is a petition seeking execution of the order passed by the Authority on 15.11.2023. Through the said order, the respondent/promoter was directed to refund the entire amount, i.e., Rs. 26,07,780/-, received from the complainant along with interest at a rate of 10.75% per annum from the date of each payment till the actual refund, after adjusting any assured returns paid”.