`Unsustainable’: TGRERA asks Aliens Developers to refund ₹2L; dismisses `forfeiture clause’ theory

The authority dismissed the builder's `forfeiture clause' theory, terming it `unsustainable and not legally binding.

The authority observed that the clause used by the developer to retain the amount was part of an unsigned document and imposed an unfair financial burden without any proven loss.

Booking cancelled within 12 days

The complainant, Uppuluri Sri Saradanvita, had booked a flat in the `Aliens Space Station’ project in Tellapur by paying a total of ₹2.5 lakh in June 2025.

However, within 12 days of booking, she sought cancellation, citing personal and financial constraints. Despite repeated follow-ups, the developer did not process the refund promptly and later returned only ₹50,000, retaining ₹2 lakh, citing a forfeiture clause.

Builder cites clause, offers partial refund

Aliens Developers argued that, as per the Customer Information Sheet (CIS), 20% of the booking amount or ₹2 lakh, whichever is higher, was liable to be forfeited upon cancellation.

The company maintained that the complainant had agreed to these terms at the time of booking and that the refund of ₹50,000 was made in accordance with the agreed conditions.

Complainant alleges fabrication of documents

The complainant contested the validity of the forfeiture clause, alleging that key pages of the CIS containing such conditions were not signed and were “fabricated” later.

She argued that only a partial document was shared at the time of booking and that the clause relied upon by the developer was neither disclosed nor consented to.

Unsigned clause not binding: TG RERA

After examining the documents, TG RERA found that the page containing the forfeiture clause did not bear signatures of either party.

The Authority held that:

A clause with significant financial implications must be explicitly agreed upon

An unsigned condition cannot be enforced against a buyer

The developer failed to prove that the complainant was aware of or consented to the clause.

‘Unfair and one-sided’ condition

Even assuming the clause was valid, TG RERA noted that it was inherently unfair.

The Authority pointed out that:

The cancellation occurred at an early stage (within 12 days)

No agreement for sale was executed

The developer failed to demonstrate any actual financial loss

“A forfeiture of ₹2 lakh without any nexus to actual loss is unreasonable and disproportionate,” the Authority observed.

RERA a consumer-protection law

Rejecting the developer’s argument that no specific RERA provision was violated, TG RERA emphasised that the Act is a welfare legislation aimed at protecting homebuyers.

It said the Authority cannot allow promoters to retain large sums based on one-sided, pre-printed terms, especially at the pre-agreement stage.

Refund order and next steps

TG RERA directed the developer to:

Refund the remaining ₹2 lakh within 30 days

Face penal action under Section 63 of the RERA Act in case of non-compliance

However, the Authority clarified that claims related to compensation for mental harassment must be pursued separately before the Adjudicating Officer under Section 71 of the Act.