A recent MahaRERA order has highlighted an important issue for homebuyers in redevelopment projects: what happens to a buyer’s refund claim when the original developer is removed and a new developer takes over the project?
In a significant order dated 1 September 2026, the Maharashtra Real Estate Regulatory Authority (MahaRERA), Mumbai, directed both the outgoing promoter and the incoming developer of a Mumbai redevelopment project to jointly and severally refund ₹38 lakh, along with applicable interest, to three homebuyers.
The case concerns Kam Ganesh Co-operative Housing Society Ltd., registered under MahaRERA as P51900008403.
The order was passed by Shri Ravindra Deshpande, Member II, following a hearing held on 17 February 2026.
The Case at a Glance
| Particular | Details |
|---|---|
| MahaRERA Complaint No. | CC006000000303575 |
| Project | Kam Ganesh Co-operative Housing Society Ltd. |
| MahaRERA Registration | P51900008403 |
| Complainants | Deepak Kanhaiyalal Shimpi, Vandana Deepak Shimpi & Nikhil Shimpi |
| Original Promoter | Mishal Construction Pvt. Ltd. |
| New Developer | M/s Shubh Prabhu Infracom LLP |
| Booking Year | 2017 |
| Amount Paid | ₹38 lakh |
| Refund Ordered | ₹38 lakh + statutory interest |
| Costs Awarded | ₹20,000 |
| Final Order | 1 September 2026 |
Homebuyers Paid ₹38 Lakh After Booking the Flat
The complainants had booked Flat No. 404, measuring approximately 647 sq. ft. carpet area, on the fourth floor of A Wing, along with one car parking space.
The agreed consideration was approximately ₹1.36 crore.
The booking followed an advertisement published in August 2017 that indicated possession would be provided by 31 December 2021.
The buyers paid approximately ₹38 lakh during 2017.
However, according to the case record, a registered Agreement for Sale was never executed.
MahaRERA also noted that accepting more than 10% of the consideration without executing a registered agreement was contrary to the requirement under Section 13(1) of the Real Estate (Regulation and Development) Act, 2016 (RERA).
Construction Did Not Progress After Demolition
The buyers subsequently found themselves in a difficult situation.
Although the existing structure had been demolished, construction did not progress as they expected. In August and September 2018, they sought cancellation of their booking and requested the return of their money.
The original promoter eventually accepted the cancellation in writing.
In a letter dated 20 November 2018, the promoter agreed to refund the entire ₹38 lakh, without deducting any amount towards earnest money.
The buyers also returned the original receipts and allotment letter as part of the cancellation process.
At this point, it appeared that the matter should have been straightforward: the booking had been cancelled and the promoter had agreed to return the money.
But the refund never actually happened.
Refund Cheques Were Issued — But the Money Was Not Paid
Following the cancellation, post-dated cheques were reportedly issued towards the refund.
One of the cheques relating to compensation was dishonoured because of insufficient funds.
Fresh cheques were subsequently issued, but the buyers were later asked not to deposit them because the promoter did not have sufficient funds.
As a result, the ₹38 lakh remained unpaid.
This became the central issue in the MahaRERA proceedings.
The Promoter Later Proposed Another Flat
The dispute became more complicated in 2021.
The original promoter attempted to adjust the outstanding amount against a flat in another project, Gagan Vihar CHS, which had MahaRERA registration number P51900006748.
This resulted in another complaint before MahaRERA.
However, in the present proceedings, MahaRERA treated the claim relating to the unpaid ₹38 lakh refund from the Kam Ganesh CHS booking as a separate issue.
That distinction is important because the buyers were not simply asking for a fresh cancellation. The original promoter had already accepted the cancellation and agreed to refund the money several years earlier.
Then the Developer Changed
Another major development took place during the dispute.
On 29 July 2021, Kam Ganesh Co-operative Housing Society terminated Mishal Construction and appointed a new developer.
The buyers' problem, however, did not disappear with the change of developer.
Their refund remained unpaid.
The complainants therefore sought to bring the new developer, M/s Shubh Prabhu Infracom LLP, into the proceedings.
The amendment adding the new developer as a respondent was allowed on 11 June 2025.
Interestingly, the new developer did not file a reply to the complaint.
MahaRERA's Important Finding
The most significant aspect of this order is what MahaRERA ultimately directed.
The Authority did not accept the position that changing the developer effectively ended the buyers' existing refund claim.
Instead, both the original promoter and the new developer were directed to refund the ₹38 lakh jointly and severally.
In simple terms, the order places responsibility on both respondents for satisfying the refund direction.
This is particularly relevant to redevelopment projects where a society terminates one developer and appoints another while disputes involving existing purchasers are still pending.
What Does "Jointly and Severally" Mean?
The expression jointly and severally is important.
It means that the liability is not divided into separate portions between the two respondents for the purpose of the order. The successful homebuyers can enforce the monetary direction against the respondents in accordance with the order, rather than being told that their claim must first be settled exclusively with the outgoing developer.
For a homebuyer, this can make a significant practical difference.
Interest Also Ordered on the ₹38 Lakh
MahaRERA did not limit the relief to the principal amount.
The respondents were directed to pay interest on the ₹38 lakh at the rate prescribed under Rule 18 of the Maharashtra RERA Rules, 2017.
The order specifies the rate as SBI's highest MCLR plus 2% per annum, calculated from the respective dates on which the amounts were paid until actual realisation.
Therefore, the financial liability can be considerably higher than the original ₹38 lakh depending upon when the money is actually recovered.
₹20,000 Costs Awarded
MahaRERA also awarded ₹20,000 towards costs to the complainants.
However, the buyers had sought a separate ₹10 lakh compensation for mental harassment.
That additional compensation was not granted.
The Authority considered the interest payable under Section 18 to be compensatory in nature and therefore did not separately award the requested ₹10 lakh for mental harassment.
Why This Order Matters for Redevelopment Homebuyers
The order raises an important practical question for purchasers involved in redevelopment projects:
If the developer who accepted your cancellation is removed by the society, does the change of developer wipe out your existing refund claim?
This order indicates that a change in developer does not, by itself, extinguish an allottee's accrued rights.
That is particularly significant where:
the buyer has already paid a substantial amount;
the booking has subsequently been cancelled;
the original promoter has accepted the cancellation;
a refund has been promised in writing;
the refund remains unpaid; and
the society later appoints another developer.
A homebuyer should not automatically assume that the arrival of a new developer means the previous dispute has disappeared.
A Lesson About Documentation
There is another important lesson in this case.
The buyers had documentary evidence showing the history of the transaction, including the allotment and the promoter's written acceptance of cancellation.
This highlights why homebuyers should preserve every document connected with a property transaction, particularly when a dispute arises.
Important records may include:
booking forms and allotment letters;
payment receipts and bank statements;
advertisements and brochures;
correspondence with the developer;
cancellation requests;
written refund commitments;
copies of cheques;
bank return memos for dishonoured cheques;
emails and WhatsApp communications;
notices exchanged with the society or developer; and
MahaRERA documents and orders.
In a dispute, these documents can help establish not only how much money was paid but also what the promoter subsequently agreed to do.
What Homebuyers Should Understand
This case should not be interpreted as meaning that every new developer automatically becomes responsible for every liability of an outgoing developer.
The outcome depends on the facts, the rights involved, the proceedings before the Authority and the applicable legal provisions.
However, the Kam Ganesh CHS order is noteworthy because MahaRERA directed the outgoing and incoming developers to be jointly and severally liable for the refund in circumstances where the original promoter had already accepted the cancellation but failed to return the money.
For buyers stuck in redevelopment projects, that is an important development to watch.
Key Takeaway
The central message from the Kam Ganesh CHS MahaRERA order is straightforward:
A change of developer does not necessarily bring an existing homebuyer's refund claim to an end.
In this case, the original promoter had accepted the cancellation and agreed to refund ₹38 lakh, but the money remained unpaid for years. Even after the society terminated the original developer and appointed a new developer, the buyers continued to pursue their claim.
MahaRERA ultimately directed both developers to jointly and severally refund ₹38 lakh, together with applicable interest, and also awarded ₹20,000 towards costs.
For prospective buyers and existing allottees in redevelopment projects, the case reinforces the importance of understanding the legal status of the project, keeping proper documentation and taking timely action when contractual commitments are not honoured.
Case: CC006000000303575
Project: Kam Ganesh Co-operative Housing Society Ltd.
MahaRERA Registration: P51900008403
Order Date: 1 September 2026
Disclaimer: This article is intended for general information and awareness purposes only. It is based on the facts and order details provided for this article and should not be treated as legal advice. Readers facing a property or RERA dispute should consult a qualified legal professional for advice based on their specific circumstances.
Comments
Post a Comment