Telangana RERA fines Hyderabad developer ₹4.2 lakh for promoting real estate project without RERA registration

The Telangana Real Estate Regulatory Authority (TG RERA) has imposed a penalty of ₹4.2 lakh on a developer for flouting key Real Estate (Regulation and Development) Act 2016 provisions.

The authority found that the developer, Sanali Housing Projects Pvt Ltd, promoted the project in Hyderabad and advertised without mandatory registration with TGRERA or obtaining required approvals from the Greater Hyderabad Municipal Corporation (GHMC).

"A penalty of ₹4,27,013 is imposed upon the promoter under section 59 of the Real Estate (Regulation and Development) Act for violation of sections 3 and 4 of the Act," the order said.

The order further directed the developer to register the project Sanali Pinnacle under Section 3 of the Real Estate (Regulation and Development) Act, 2016. "Until such registration is obtained, the developer is restrained from advertising, marketing, booking, selling, offering for sale, or inviting any person(s) to purchase any unit in the said project."

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The case

The Sanali Pinnacle project, located in Hyderabad's Shaikpet, is a mixed-development project with residential and commercial units.

The complainants, who are landowners, signed an agreement with the developer in March 2021.

"The agreement stipulated that development would commence only upon obtaining requisite approvals from GHMC. However, even after three years, the Respondents failed to secure necessary permissions or provide updates," the order said.

The order further said that the developer failed to register the project with TGRERA and proceeded to advertise ‘Sanali Pinnacle’ on various platforms, including Google, real estate websites, and their official website, falsely claiming approvals had been secured. Additionally, advertisement boards displaying ‘Sanali Coming Soon….’ were erected at the site.

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TGRERA findings

Referring to Section 3 of the RERA Act, the authority stated that the promoter is prohibited from advertising, marketing, booking, selling, or offering any real estate project for sale unless the project is registered with the Telangana Real Estate Regulatory Authority.

'In the present case, the developer has published an advertisement on its official website, presenting the project as an 'ongoing project,' despite not having secured registration under TGRERA," it said.

In its defence, the developer contended that the publication does not constitute an advertisement as it merely provides the project's name without specifying the location, area, pricing, or other material particulars.

However, TGRERA said that according to Section 2(b) of the RERA Act, any material shared with the public about a real estate project counts as an advertisement, even if it does not mention the price, location, or other details. The developer's claim that mentioning the project name is not an advertisement does not hold up, as the Act does not say that only detailed information qualifies as advertising.

"In the present case, it has been established that the developer's act of publishing the project as an ongoing project on its website, describing it as an uber-luxurious apartment complex comprising 40 units, and further displaying a board on-site stating, 'Exquisitely crafted residences for exceptional 40,' constitutes an act of promoting the project without prior registration under TGRERA," the order said.

Thus, TGRERA said the developer has violated the provisions of Section 3(1) of the RERA Act and is liable for the penalty.

HT.com has sent a list of queries to the real estate developer. If they respond, the copy will be updated.