TaxTMI 
TaxTMI 
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2025 (11) TMI 73
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....r Ikram also appears on behalf of the appellant-allottee in RERA Appeal No. 70 of 2025. 2. The RERA Appeal Defective No.18; RERA Appeal Defective No.19 of 2025; RERA Appeal Defective No.20 of 2025 and RERA Appeal Defective No.25 of 2025 have been filed along with an application for condonation of delay. The cause shown are sufficient. The applications for condonation of delay are allowed. The delay in filing the appeals are condoned. 3. All the abovesaid appeals arise out of the same judgment passed by the U.P. Real Estate Appellate Tribunal, as such, are being decided by means of this common judgment. 4. For the brevity, the facts as emerge from the RERA Appeal No.72 of 2025 are that the respondent was allotted an apartment by the appellant at NOIDA under a builder buyer agreement on 22.01.2019. It is stated that on 16.09.2022, completion certificate was issued by the Greater Noida Industrial Development Authority in favour of the promoter. It is further stated that on 11.10.2022, the respondent filed a complaint for grant of interest and compensation under Form-N prescribed under The Real Estate (Regulation and Development) Act, 2016 (herein after referred to as "the RER....
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.... to claim interest for the period of delay till such time the possession was offered, which authority is solely vested with Regulatory Authority and not the Adjudicating Officer. In paragraphs 13 and 14, the grant of compensation was said to be bad in law and in paragraph 23, it has been stated that in the builder buyer agreement, the expected date of offer was December, 2019 but the same was subjected to delay including COVID-19. In paragraph 29, it was specifically pleaded that the term mentioned in the builder buyer agreement was not essence of the contract and only a tentative time of completion of the project along with extension clause was provided indicating that the offer of possession was subject to incidents of 'force majeure' which may adversely affect the delivery of possession and there was no provision for grant of any penal consequences. In paragraph 31, it was admitted that the offer of possession was sent for the first time on 13.10.2022. In paragraph 33, the jurisdiction of the Adjudicating Authority was once again challenged. In paragraph 35, a ground has been taken that in the official website of the RERA, the completion period of the project is mentioned as 30.....
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....A appeal being No.70 of 2025 has been preferred by the appellant. 8. One of the respondents-allottee preferred RERA Appeal No.70 of 2025 attacking the order by arguing that the compensation could not have been refused apart from interest. 9. It is admitted in between the parties that in terms of the builder buyer agreement executed in between the appellant and the respondent on 22.01.2019, the date of delivery of possession was indicated as December, 2019. It is also admitted that the completion certificate was received on 16.09.2022 and the letter for the allotment was issued by the appellant on 13.10.2022. 10. It is argued by the Counsel for the appellant that after issuance of the completion certificate by the competent authority, the appellant issued offer of possession to the allottee on 13.10.2022 but the respondent did not come forward for execution of the lease deed. Subsequently, the lease deed was executed on 15.02.2024 in between the promoter and the allottee. It is also argued that the manner in which the interest has been awarded by the Tribunal is bad in law and further the pre-deposit for preferring the appeal could not have been directed to be released in f....
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....(P) Ltd.:1967 SCC OnLine SC 119 held as under: "... It is necessary to emphasize that though the Tribunal is not a court, it is invested with judicial power to be exercised in manner similar to the exercise of power of an appellate court acting under the Code of Civil Procedure. Authority to "pass such orders thereon as it thinks fit" in Section 33(4) of the Income Tax Act, 1922, is not arbitrary : the expression is intended to define the jurisdiction of the Tribunal to deal with and determine questions which arise out of the subject-matter of the appeal in the light of the evidence, and consistently with the justice of the case. In the hierarchy of authorities the Appellate Tribunal is the final fact-finding body; its decisions on questions of fact are not liable to be questioned before the High Court. The nature of the jurisdiction predicates that the Tribunal will approach and decide the case in a judicial spirit and for that purpose it must indicate the disputed questions before it with evidence pro and con and record its reasons in support of the decision. The practice of recording a decision without reasons in support cannot but be severely deprecated." 13. Simila....
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....n the light of the submissions made by the appellant. This can only be done by giving a decision on the merits on questions of fact and law and not by merely disposing of the appeal on the ground that the party concerned has failed to appear. As observed in Hukumchand Mills Ltd. v. CIT, [(1967) 63 ITR 232 : 1966 SCC OnLine SC 171] the word "thereon" in Section 33(4) restricts the jurisdiction of the Tribunal to the subject-matter of the appeal and the words "pass such orders as the Tribunal thinks fit" include all the powers (except possibly the power of enhancement) which are conferred upon the Appellate Assistant Commissioner by Section 31 of the Act. The provisions contained in Section 66 about making a reference on questions of law to the High Court will be rendered nugatory if any such power is attributed to the Appellate Tribunal by which it can dismiss an appeal, which has otherwise been properly filed, for default without making any order thereon in accordance with Section 33(4) " 14. It is further argued that as far as the grant of interest is concerned, Section 18 of RERA Act read with Rule 33 of The Uttar Pradesh Real Estate (Regulation and Development) Rules, 2016 (h....
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.... of the allottee as has been done by the impugned order. 18. The Counsel for the respondent, on the other hand, argues that the appeal has been filed against an order of compromise,wherein, the facts were admitted as recorded by the Tribunal and the grant of interest according to him is a mechanical exercise in view of the prescriptions contained in Section 18(1)(a) which does not require any further exercise and thus argument of the Promoter to that effect deserves to be rejected. He places reliance upon the judgment of this Court dated 18.11.2023 passed in RERA Appeal No.67 of 2023 (U.P. Avas Evam Vikas Parishad, Lucknow vs Dhruv Kumar Chaturvedi) as well as on the judgment dated 08.10.2020 passed in Writ-C No.13904 of 2020 (Vibhor Vaibhav Infrahomes Pvt. Ltd. vs Union of India & Ors. 19. This Court, vide order dated 28.04.2025, had admitted RERA Appeal(s) No.41, 42, 43, 44 of 2025 and the RERA Appeal Defective No.21 of 2025, now renumbered as RERA Appeal No.45 of 2025, on the following questions of law: (i). Whether the Appellate Tribunal was justified in granting delayed interest for a period which is mentioned in its impugned order dated 17.2.2025 para 18(ii) wi....
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....ers who do not possess the bargaining powers while entering into contracts with promoters which are generally one sided. 22. Before adverting to decide the points, it is essential to note Sections 2(za), 18, 19, 40, 43 of the RERA Act, which reads as below: "2 (za). (za) "interest" means the rates of interest payable by the promoter or the allottee, as the case may be. Explanation. - For the purpose of this clause - (i) the rate of interest chargeable from the allottee by the promoter, in case of default, shall be equal to the rate of interest which the promoter shall be liable to pay the allottee, in case of default; (ii) the interest payable by the promoter to the allottee shall be from the date the promoter received the amount or any part thereof till the date the amount or part thereof and interest thereon is refunded, and the interest payable by the allottee to the promoter shall be from the date the allottee defaults in payment to the promoter till the date it is paid; 18. Return of amount and compensation.-(1) If the promoter fails to complete or is unable to give possession of an apartment, plot or building- (a) in ac....
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....e case may be, and the association of allottees shall be entitled to claim the possession of the common areas, as per the declaration given by the promoter under sub-clause (C) of clause (1) of sub-section (2) of Section 4. (4) The allottee shall be entitled to claim the refund of amount paid along with interest at such rate as may be prescribed and compensation in the manner as provided under this Act, from the promoter, if the promoter fails to comply or is unable to give possession of the apartment, plot or building, as the case may be, in accordance with the terms of agreement for sale or due to discontinuance of his business as a developer on account of suspension or revocation of his registration under the provisions of this Act or the rules or regulations made thereunder. (5) The allottee shall be entitled to have the necessary documents and plans, including that of common areas, after handing over the physical possession of the apartment or plot or building as the case may be, by the promoter. (6) Every allottee, who has entered into an agreement for sale to take an apartment, plot or building as the case may be, under Section 13, shall be respons....
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.... The appropriate Government shall, within a period of one year from the date of coming into force of this Act, by notification, establish an Appellate Tribunal to be known as the (name of the State/Union territory) Real Estate Appellate Tribunal. (2) The appropriate Government may, if it deems necessary, establish one or more benches of the Appellate Tribunal, for various jurisdictions, in the State or Union territory, as the case may be. (3) Every bench of the Appellate Tribunal shall consist of at least one Judicial Member and one Administrative or Technical Member. (4) The appropriate Government of two or more states or Union territories may, if it deems fit, establish one single Appellate Tribunal: Provided that, until the establishment of an Appellate Tribunal under this section, the appropriate Government shall designate, by order, any Appellate Tribunal Functioning under any law for the time being in force, to be the Appellate Tribunal to hear appeals under the Act: Provided further that after the Appellate Tribunal under this section is established, all matters pending with the Appellate Tribunal designated to hear appeals, shall....
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....seat of the said regulatory authority is situated. Explanation. For the purpose of this sub-rule "person" shall include the association of allottees or any voluntary consumer association registered under any law for the time being in force. (2) The regulatory authority shall for the purposes of deciding any complaint as specified under sub-rule (1), follow summary procedure for inquiry in the following manner: (a) Upon receipt of the complaint the regulatory authority shall issue a notice along with particulars of the alleged contravention and the relevant documents to the respondent; (b) The notice shall specify a date and time for further hearing; (c) On the date so fixed, the regulatory authority shall explain to the respondent about the contravention alleged to have been committed in relation to any of the provisions of the Act or the rules and regulations made thereunder and if the respondent: (i) pleads guilty, the regulatory authority shall record the plea, and pass such orders including imposition of penalty as it thinks fit in accordance with the provisions of the Act or the rules and regulations, made thereunder; ....
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....t thereof. & (iv). Whether, grant of interest requires any adjudication or can be granted automatically as per Section 18(1) of the RERA Act? Answers: 25. Since both the questions are correlated to each other, as such, the same are being decided together. 26. On plain reading of the RERA Act and the mandate contained therein, what emerges is that the RERA Act was enacted to protect the allottee in the Real Estate Project and for regulating the Real Estate Sector. Various prescriptions are contained in the RERA Act, which flow essentially from Chapter III, which prescribes for functioning and duties of the promoters and Chapter IV prescribes for rights and duties of the allottee. Several other provisions are also contained in the Act with regard to the grant of interest and/or compensation in the event of any default committed by the promoters and complying with any of the stipulations contained in Chapter III, however, interest is specifically prescribed in Section 18(1), which is in two parts in respect of allottees who wish to withdraw from the project and the allottees who wish to continue with the project. In case of allottees who wish to withdraw Int....
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....al Estate (Regulation and Development) (Agreement for Sale/Lease) Rules, 2018 as the Rule 15 of The UP Real Estate (Regulation and Development) Rules 2016 is silent as observed above being an ex facie error by the draftsman, the same cannot be faulted with as is reasonable. 30. In the present case, admittedly, there was no dispute with regard to the date prescribed in the agreement to sale for completion of the project that was 31.12.2019 and even as per the admission, as recorded in paragraph 13 of the impugned judgment, the offer of possession was made on 05.11.2022, which fact was also admitted by the learned Counsel for the appellant during the course of the hearing before the Tribunal, thus, the normal consequence of the agreement on the three dates would result in automatic award of interest in terms of the mandate of Section 18(1)(a) and was rightly awarded by the Tribunal, thus, the Question No.(iv) is decided against the appellant. 31. The question no.(i) is with regard to the scope of powers of the Tribunal in granting the interest directly in exercise of its appellate powers prescribed under Section 43. Heading of Section 44 of the RERA Act describes application fo....
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....ower to direct the appropriation of the said amount as has been done by the Tribunal. 34. To analyse the said provision, Section 43(5) provides for a condition to be fulfilled by the appellant/ promoter as pre-deposit for the appeal to be entertained by the Tribunal. The nature and scope of pre- deposit as prescribed under Section 43 (5) is contained in various statutes as a condition for preferring an appeal and was considered extensively by Hon'ble Supreme Court in the case of Harinagar Sugar Mills Ltd. vs State of Bihar and others:(2003) 11 SCC 40, wherein, Hon'ble Supreme Court analyse the similar provisions, which are as under: 11. The main question, however, that needs to be considered is whether the amount deposited in view of Section 27-B of the Act is deposit of the liability of dues of fee assessed or not. 12. The amount in respect of which the Appellate Authority is to be satisfied that it has been so deposited, according to Section 27-B of the Act has to be in certain proportion of the amount of fee assessed and due. That is to say, the liability of the assessee is already fixed and the amount assessed is treated to be amount due to be paid, it is a....
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....de to the Committee. Some observations relating to deposit of the tax liability while filing an appeal, though in a slightly different context, throw some light as to the nature of the deposit. In Anant Mills Co. Ltd. v. State of Gujarat [(1975) 2 SCC 175], SCC at pp. 202-03, para 40, this Court observed: "In the absence of any special reasons there appears to be no legal or constitutional impediment to the imposition of such conditions. It is permissible, for example, to prescribe a condition in criminal cases that unless a convicted person is released on bail, he must surrender to custody before his appeal against the sentence of imprisonment would be entertained. Likewise, it is permissible to enact a law that no appeal shall lie against an order relating to an assessment of tax unless the tax had been paid. Such a provision was on the statute-book in Section 30 of the Indian Income Tax Act, 1922. The proviso to that section provided that '... no appeal shall lie against an order under sub-section (1) of Section 46 unless the tax had been paid'. Such conditions merely regulate the exercise of the right of appeal so that the same is not abused by a recalcitrant party and....
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....ring that period when liability subsists shall be in discharge of that liability as fixed. As provided under Section 27-B of the Act the Appellate Authority has only to be satisfied that a given part of the fee assessed and due has been paid to the Committee before it entertains the appeal. There is no direction as such for the appellant to make any payment under Section 27-B of the Act. It is for the Appellate Authority to be satisfied that a part of the liability is in deposit with the Committee. 14. Considering the facts of the present case in the light of what has been observed by us above, we find that orders of assessment had been made. The liability had been fixed and the amount was determined. The Appellate Authority was satisfied that one-third amount of the fee assessed and due was paid to the Committee before filing of appeals. The appeals were dismissed. The revisions preferred thereafter were also dismissed. All statutory remedies stood exhausted. Writ petitions filed under Article 226 of the Constitution were pending when the order of this Court was rendered in Belsund Sugar Co. case [(1999) 9 SCC 620 : AIR 1999 SC 3125] . The writ petitions were disposed of ....
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....eaning of the expression "entertain" in the context of a similar provision in the Uttar Pradesh Sales Tax Act, 1948 wherein it was held that in such context, the expression has the meaning of "admitting to consideration". The relevant discussion is available at paras 9 and 10 : (AIR pp. 492-93) "9. The word "entertain" is explained by a Division Bench [Kundan Lal v. Jagan Nath Sharma, 1962 SCC OnLine All 38 : AIR 1962 All 547] of the Allahabad High Court as denoting the point of time at which an application to set aside the sale is heard by the court. The expression "entertain", it is stated, does not mean the same thing as the filing of the application or admission of the application by the court. A similar view was again taken in Dhoom Chand Jain v. Chaman Lal Gupta [Dhoom Chand Jain v. Chaman Lal Gupta, 1962 SCC OnLine All 29 : AIR 1962 All 543] in which the learned Chief Justice Desai and Mr Justice Dwivedi gave the same meaning to the expression "entertain". It is observed by Dwivedi, J. that the word "entertain" in its application bears the meaning "admitting to consideration", and therefore when the court cannot refuse to take an application which is backed by depos....
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....e expression "appeal" and "memorandum of appeal" are used to denote two distinct things. In Wharton's Law Lexicon, the word "appeal" is defined as the judicial examination of the decision by a higher court of the decision of an inferior court. The appeal is the judicial examination; the memorandum of appeal contains the grounds on which the judicial examination is invited. For purposes of limitation and for purposes of the rules of the Court it is required that a written memorandum of appeal shall be filed. When the proviso speaks of the entertainment of the appeal, it means that the appeal such as was filed will not be admitted to consideration unless there is satisfactory proof available of the making of the deposit of admitted tax." 20. We are also conscious of the fact that such a precondition is present in several statutes while providing for statutory appeals, like the Income Tax Act, 1961, the Central Excise Act, 1944, the Consumer Protection Act, 1986, the Motor Vehicles Act, 1988, etc. However, unlike those statutes, the purpose of the SARFAESI Act is different, it is meant only for speedy recovery of the dues, and the scheme under Section 13(4) of the Act, pe....
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....instant case also, the money was expressly to be treated to be with the Registry of the High Court. 13. On the strength of the law laid down by this Court in Axis Bank [Axis Bank v. SBS Organics (P) Ltd., (2016) 12 SCC 18 : (2016) 4 SCC (Civ) 681], in our view, the appellants are entitled to withdraw the sum deposited by them in terms of said order dated 11-10-2017 [State Bank of Travancore v. Mathew K.C., (2018) 3 SCC 85 : (2018) 2 SCC (Civ) 41] . Their entitlement having been established, the claim of the appellants cannot be negated by any direction that the money may continue to be in deposit with the Bank." 37. Thus in view of the Judgments referred above and on the plain interpretation of Section 43(5) read with the context in which, the appeal is prescribed under the RERA Act, it is clear that the interest and/ or compensation, awarded can be challenged before the Tribunal after making the pre-deposit as required for the entertainment of the appeal. The said amount can be appropriated towards the adjudicated amount decided by the authority or the adjudicating authority as the case may be and there is no entitlement of refund unless the appeal is allowed and the o....
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....is section from an appellate decree passed ex parte. (3) In an appeal under this section, the memorandum of appeal shall precisely state the substantial question of law involved in the appeal. (4) Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question. (5) The appeal shall be heard on the question so formulated and the respondent shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question: Provided that nothing in this sub-section shall be deemed to take away or abridge the power of the Court to hear, for reasons to be recorded, the appeal on any other substantial question of law, not formulated by it, if it is satisfied that the case involves such question." 41. Thus, on plain reading of Section 58 of the RERA Act and Section 100 of C.P.C., it is clear that an appeal would lie only against a decree passed in appeal in any court when only substantial questions of law are involved. 42. From the submissions as recorded in the appellate order, against which, the present RERA Appeals have been filed, it is clearly recorded that ther....