No Forfeiture Order, No Retention: Punjab RERA Upholds Shop Allotment Cancellation But Orders ₹3 Lakh Refund

The Punjab Real Estate Regulatory Authority (RERA) has upheld the cancellation of a commercial shop allotment in Mohali after the buyer failed to meet auction payment timelines but directed refund of a separate deposit of Rs 3 lakh that had been retained without any forfeiture order in this case.

The order was passed by a bench of Member Binod Kumar Singh.

While examining how the payments were handled in this allotment, the Authority explained why the later deposit could not be retained. It observed, “It is a general financial principle that the interest of any money belongs to the person (complainant) who owns the money. In case the money is utilized by other person (respondent) without any due compensation to the owner of money, the interest earned on it should be refunded to the owner (complainant).”

Limiting its conclusion to the dispute before it, the authority added that “from the above discussion, it is held that the only amount refundable to the complainant is Rs. 300,000.”

The dispute arose from an online auction conducted by the Punjab Urban Planning and Development Authority (PUDA) in October–November 2019 for a convenience shop in Gateway City, Sector 118–119, SAS Nagar.

Teena Goel emerged as the highest bidder and was required to deposit 25 % of the bid amount within 30 days. While she deposited 10% of the bid amount along with 2% cess, she failed to deposit the remaining 15% within the stipulated period and did not seek any extension.

On this ground, the allotment was cancelled by an order dated April 6, 2022, and Rs 2.66 lakh was forfeited. Separately, the complainant had deposited Rs 3 lakh in July 2020, which was neither adjusted nor expressly forfeited.

Before Punjab RERA, the complainant cited administrative difficulties and disruptions during the Covid period, while the respondents relied on the auction terms and the failure to seek an extension.

Agreeing with the respondents on cancellation, the authority held that “there was complete inaction on part of the complainant.” However, noting that there was no order dealing with the Rs 3 lakh deposit, it directed the Estate Officer, Greater Mohali Area Development Authority, to refund the amount with interest at 10.80% per annum from the date of receipt until actual refund.

For Complainant: Advocate Manisha Maggu

For Respondent: Advocate Sandeep Bhardwaj