If a developer makes a mistake, the buyer must suffer the loss?

The Real Estate Appellate Tribunal has clarified that a buyer should not be held accountable for the developer’s mistakes. The tribunal criticised a bank for seizing apartments from nine buyers after the developer failed to repay a loan. The bank had attempted to seize the apartments from the buyers, and the tribunal immediately ordered the cessation of the seizure process. Real estate experts have commented that this is a historic ruling in favour of protecting buyers’ interests.

In the Ideal Exotica project in New Alipore, West Bengal, several buyers had purchased apartments ranging from Rs 1.95 lakh to Rs 3.14 crore. However, the developer had taken an additional loan of Rs 320 crore from Yes Bank and failed to repay it. As a result, the bank attempted to seize nine apartments from the buyers, which led to a dispute. The flat owners turned to the Bengal RERA, and the ruling was made in their favour. The Yes Bank challenged this decision in the Real Estate Appellate Tribunal, but after hearing the arguments, the tribunal upheld the RERA decision, stating that it was not fair to seize apartments from the buyers due to the developer’s mistake.