Hyderabad: TGRERA fines real estate firm Rs 17.8L for apartment project delays

Complaints from flat buyers lead to TGRERA's penalty against Sterling Homes for unauthorized construction and delays.

Hyderabad: The Telangana Real Estate Regulatory Authority (TGRERA) has levied a penalty of Rs 17.8 lakh on Sterling Homes and its Managing Director, Vasudeva Reddy, due to complaints from residents of the “Sterling Orchids” project in Mallampet Village, Medchal-Malkajgiri district.

A group of 15 complainants accused the developer of engaging in unauthorized construction, deviating from approved plans, delaying project completion, and failing to issue occupancy certificates.

As part of TGRERA’s ruling, Sterling Homes is required to pay an additional 10.95% annual interest on the amounts already paid by buyers within 90 days.

Furthermore, the developer must complete the construction of Phase I, including the amenity block, within the same period.

Complainants are also obligated to settle any outstanding payments within 45 days to ensure project completion. Non-compliance with these directives may lead to further penalties, the authority added.

The “Sterling Orchids” project in Mallampet Village, Medchal-Malkajgiri district, was initially set for completion by July 1, 2023, with a grace period extending to December 2023.

The Telangana Real Estate Regulatory Authority (RERA) has now instructed the developer to finalize any outstanding work within 90 days from November 14, 2024.

Flat buyers filed a complaint alleging that Sterling Homes failed to comply with the approved construction plan and did not deliver the project on schedule.

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Arguments made by complainants

The complainants claimed that the developer deviated from the sanctioned plans, particularly regarding the construction of the clubhouse and the lack of a compound wall separating the project from the adjacent Phase II development.

They also accused Sterling Homes of utilizing shared amenities between the two phases without prior notification, misleading potential buyers.

Furthermore, they alleged that the developer relocated the Sewage Treatment Plant (STP) against the approved plan and commenced Phase II construction before completing Phase I, thus infringing on the rights of Phase I purchasers.

Counter filed by Sterling Homes

In response, Sterling Homes filed a counter with TGRERA, asserting that delays were attributable to external factors such as regulatory challenges, heavy rainfall, labour shortages, and disruptions caused by the pandemic.

The developer maintained that it had no intention of delaying the project and characterized any deviations from the approved plans as minor adjustments necessary for structural integrity, which had been sanctioned by relevant authorities.

Sterling Homes refuted allegations of malicious intent, stating that Phase II was initiated only after securing necessary approvals and that shared amenities were disclosed to buyers.

The firm also claimed that delays in Phase I were due to financial difficulties stemming from the complainants’ alleged failure to settle outstanding payments.