Mumbai collector received an HC contempt notice for their inaction on Avarsekar Realty.

MUMBAI: The Bombay High Court has sent the Mumbai City Collector Rajiv Nivatkar a notice to show cause as to why action should not be taken under the Contempt of Courts Act given that he “wilfully disobeyed” its direction to attach apartments belonging to a builder in Mahim.

The notification is part of a lawsuit that a flat buyer has filed against a builder in an effort to recoup damages for a delay in transferring possession.

For “willful disobedience” of its March 2023 order, the HC on April 24 issued a show cause notice to an approved agent of the developer, Avarsekar Realty Pvt Ltd.

The builder had been prohibited by the HC from selling unsold apartments in a 42-story structure he had built.

HC: The builder ‘wilfully’ ignored the court’s order.

Rajiv Nivatkar, the Mumbai City Collector, and a designated employee of Avarsekar Realty Pvt Ltd have received notifications from the Bombay High Court for breaching its ruling from March 2023. The decision was made in response to a contempt petition brought by a buyer, Mumbai-based attorney Ashok Paranjpe.

The builder was required by March 2023 ruling to state the funds collected from flat sales and provide justification for not declaring an interest amount as compensation for the delay in giving over apartments. On March 25, the builder submitted an affidavit in rebuttal. Pooja Gaikwad, the builder’s attorney, said that because units had been set aside for Paranjpe and his wife, it “would suffice” to satisfy their claims.

However, after hearing from Paranjpe’s attorney Simil Purohit, a bench of Justices R D Dhanuka and Gauri Godse noted that the builder “has obviously suppressed” facts and “wilfully” disobeyed its March 8 order. Purohit contended that the builder had the resources necessary to make the payment. E further told the HC that a Rajya Sabha lawmaker had purchased a condo in the development for Rs 6 crore.

In 2012, Paranjpe and his wife reserved and paid more than Rs 2.5 crore for an apartment in the Mahim development known as Shrishti Sea View. The Real Estate (Regulation) Act was adopted in 2017 to regulate the real estate market and ensure timely possession. Paranjpe had requested interest on the money previously paid from the builder as required by law.

The builder has been ordered by the Maharashtra Real Estate Regulatory Authority (MahaRERA) to pay over 10% interest on the money from February 2015 till the time possession is granted beginning in 2020.

Four unbooked flats were the subject of an attachment warrant issued by MahaRERA in January 2021, and the municipal collector was given the go-ahead to sell them in order to pay back Paranjpe’s interest. Purohit claimed that the collector was disobeying court instructions notwithstanding the attachment warrant.

The RERA Appellate Tribunal likewise upheld the compensation order in July 2021. When the HC rejected Paranjpe’s request for an order compelling the collector to take action in September 2022, it instructed him to take his complaint up with MahaRERA, which it believed also had responsibility for ensuring that an attachment warrant was executed as intended by RERA.

According to the HC, the Act permits recovery from the promoter, allottee, or real estate agency as arrears of land revenue by an auction following the attachment, depending on who the order is against. The matter will be heard again on June 12.