TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>RERA Regulation 9 upheld allowing single member delegation; RERA prevails over SARFAESI but cannot apply retrospectively to pre-existing bank securities</h1> <h3>Union Bank Of India Versus Rajasthan Real Estate Regulatory Authority, Mamta Kotia, Rajesh Durgalal Kotia, Sng Real Estate Pvt. Ltd, Shashi Kant Sharma, Kusum Lata Sharma, Vijay Laxmi Sharma, Prabodh Sharma</h3> Union Bank Of India Versus Rajasthan Real Estate Regulatory Authority, Mamta Kotia, Rajesh Durgalal Kotia, Sng Real Estate Pvt. Ltd, Shashi Kant Sharma, ... The judgment from the Rajasthan High Court primarily revolves around the validity of Regulation 9 of the Rajasthan Real Estate Regulatory Authority Regulations, 2017, and its implications on the powers of the Real Estate Regulatory Authority (RERA) in adjudicating disputes involving real estate projects. Below is a detailed analysis and summary of the judgment:1. ISSUES PRESENTED and CONSIDEREDThe core legal questions addressed in the judgment are:Whether Regulation 9 of the Rajasthan Real Estate Regulatory Authority Regulations, 2017, is ultra vires the parent Act, the Rajasthan Real Estate (Regulation and Development) Act, 2016 (RERA Act).Whether the delegation of powers to single members of RERA to adjudicate complaints is valid.The interplay between the RERA Act and the SARFAESI Act, particularly regarding the jurisdiction of RERA over banks and financial institutions.The applicability of RERA to transactions and security interests created before the enactment of the RERA Act.The jurisdiction of RERA to issue directions against banks or financial institutions claiming security interest over properties subject to agreements between allottees and developers.2. ISSUE-WISE DETAILED ANALYSISIssue 1: Validity of Regulation 9Legal Framework: Regulation 9 allows RERA to delegate adjudication proceedings to single benches. The petitioners contended it was ultra vires the RERA Act.Court's Interpretation: The court upheld Regulation 9, stating it is consistent with the Act and merely procedural, allowing for efficient adjudication.Key Evidence: The court referenced decisions from other High Courts and the Supreme Court, particularly the case of M/s Newtech Promoters and Developers Pvt. Ltd., which supported the delegation of powers.Conclusion: Regulation 9 is not ultra vires and is valid under the RERA Act.Issue 2: Delegation of Powers to Single MembersLegal Framework: Section 81 of the RERA Act permits delegation of powers to members.Court's Interpretation: The court found that the delegation to single members is permissible under Section 81 and supported by Regulation 9.Conclusion: Delegation of powers to single members is valid and can occur even without Regulation 9.Issue 3: Interplay Between RERA and SARFAESI ActLegal Framework: Both RERA and SARFAESI have overriding clauses, leading to potential conflicts.Court's Interpretation: The court, referencing the Supreme Court's decision in Bikram Chatterji, held that RERA provisions prevail in case of conflict.Conclusion: RERA provisions take precedence over SARFAESI in conflicts involving real estate projects.Issue 4: Applicability of RERA to Pre-Existing TransactionsLegal Framework: RERA Act was not given retrospective effect.Court's Interpretation: RERA cannot apply to transactions completed before its enactment unless fraud is involved.Conclusion: RERA does not apply to pre-existing security interests unless there is fraud or collusion.Issue 5: Jurisdiction Over Banks and Financial InstitutionsLegal Framework: RERA's jurisdiction extends to promoters, allottees, and real estate agents.Court's Interpretation: Banks can be considered assignees of promoters when they exercise rights under Section 13(4) of the SARFAESI Act.Conclusion: RERA can have jurisdiction over banks if they take action under SARFAESI Section 13(4).3. SIGNIFICANT HOLDINGSRegulation 9 is Valid: 'Regulation 9 is not ultra vires the Act or is otherwise not invalid.'Delegation of Powers: 'The delegation of powers in the single member of RERA to decide complaints filed under the Act even otherwise flows from Section 81 of the Act.'RERA vs. SARFAESI: 'As held by the Supreme Court in the case of Bikram Chatterji, in the event of conflict between RERA and SARFAESI Act, the provisions contained in RERA would prevail.'Non-Retrospective Application: 'RERA would not apply in relation to the transaction between the borrower and the banks and financial institutions in cases where security interest has been created by mortgaging the property prior to the introduction of the Act.'Jurisdiction Over Banks: 'RERA authority has the jurisdiction to entertain a complaint by an aggrieved person against the bank as a secured creditor if the bank takes recourse to any of the provisions contained in Section 13(4) of the SARFAESI Act.'The judgment concludes by directing parties to pursue their cases before appropriate authorities, lifting stays on pending proceedings, and providing timelines for filing replies or appeals.
TaxTMI 