The seller is responsible if--but also only if--he committed fraud. Fraud is the knowing misrepresentation--that is, a knowing or intentional lie--made about something material, to get you to enter into a transaction or do something (like buy a house). IF the seller knew (or under the circumstances, logically must  have known) that the renovations were unpermitted but did not disclose that, that could make him liable. As a general matter, if he made the renovations he would know or be held that he must have known of the status of permitting and so could be liable for not disclosing this. However, if the renovations predate him, their unpermitted status may not have previously been discovered and he would in that case not be liable--you cannot lie about something (commit fraud) unless you know the truth.