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‘CONTRIBUTOR
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ARTICLE
India: Sale Of Apartments Only On The Basis Of Carpet Area -
HARERA
toMy 2021
bby Amaresh Singh, Akanksha Upnels and Alshay Gusta
‘Your Linkedin Connections
wth he authors
Earlier, developers/bullders quantified area on the bass of Super Area and charged thereon, thereby attaining
huge profit margins. Super Area as defined in various agreements between builder and buyer is usually vague
‘and ambiguous. This is 8 misleading practice that can cause confuslan and lead to avoidable litigation. Whilst
the customer is contractually forced to pay fr the apartment an the basis of Super Area, the loading onthe
‘actual area thatthe customer actualy gets is usually not known. The shock dawns when the customer later
discovers that the loading is exorbitant high. Infact, the Supreme Court in the recent case of Jaypee
Kensington Boulevard Apartments Welfare Association & Ors v. NCC (india) Led remarked that the
homebuyers could not be charged with an extra amount towards an arbitrary increase in the name of super
bulltup area’. Such situations are avoided when the sale happens on a Carpet Area basis where the customer
pays only for the Carpet Area,
In arecent move chat comes as a much-needed respite te the homebuyers in Haryana, the Haryana Real
Estate Regulatory Authority (H-RERA), Gurugram deriving genesis from the Act and the State Rules has
directed the developers to sell apartments only onthe basis ofthe Carpet Area. Ina press conference held on
‘Apri 27,2021, H-RERA unequivocally stated thatthe sale of property on the basis of Super Area or any other
basis s legal and conveyance deeds in the district can be executed only on Carpet Area bass. The Authority
further remarked thatthe practice of the sale of property on a Super Area basis's misleading. ambiguous,
opaque, a gives rise to confusion and complexities, and sometimes results in avoidable Itgation. The
recent complaints from a large number of homebuyers thatthe property developers charge them for the
‘Super Area and not the Carpet Area forced this move.
Dr. K. Khandelwal, Chairman, H-RERA, Gurgaon, asserted that these regulations were issued to ensure that
the sale of property or realestate projects were one in an efficient and transparent manner and to protect
the interest of consumers, H.RERA, Gurugram, warned that the sale agreement of any realestate, i not
reg'stered onl on the basis of carpet area, wll constitute an unfair trade practice and atract appropriate
{action as per the relevant provisions of the Act Such a sale would also be declared null and void by H-RERA.
‘As per the HARERA Act, which came into force in 2017, developers are allowed to sell property ony on actual
Carpet rea and not the Super Area, but they have often gotten away with it due to vague definitions, He
noted that there was a lack o legal certainty surrounding the term Carpet Avea before the RERA Ac, 2016
came Into existence. The definition of Carpet Area as provided under Section {4 ofthe RERA Act means the
net usable floor area. ll walls which are constructed or provided on the external face of an apartment shall
be regarded as external walls, and all walls or independent columns constructed or provided within an
‘apartment shall be regarded as Internal partition wall. While externas wall, service shafts, balcony veranda,
{and open terrace have to be excluded from the defition, the internal partition walls of the apartment are not
‘excluded as they form a part ofthe integral structure, that is, Carpet Area,
‘The reglstration of the conveyance deeds isto be done only on the basls ofthe Carpet Area, While in a case
here the conveyance deed ofthe units has not been executed, the promoter shall also indicate the Carpet
‘rea in dition to the Super Area and its details/eonstituents. ‘As perthe narms, the total price/cost wll remain unaltered even ifthe unit isto be registered on a Carpet
‘Area basis and will not alter the sale consideration. ris only for the purpose of disclosure and the exact
description ofthe apartment,
Succnetly put, the leislatve mandate emanating from the Act was clearly manifest that now che propery can
be sold only on the bass of Carpet Area. The mandatory draft Agreement to sell provided by the Rules also
reinforces the decerrninant of Carpet Area. Therefore, itis really surprising that such mandatory prouisions
‘are not being complies with, Will such acts and omissions pass the judicial muster, only time would ell but we
have serious doubts
Footnote
The content ofthis article is intended to provide a general guide tothe subject matter. Specialist advice
should be sought about your specie circumstances.
AuTHoRs)
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