The Assam Real Estate Appellate Tribunal (REAT) has directed a builder to deposit with it Rs.32,32,850.00 before its appeal against an order of the Real Estate Regulatory Authority(RERA), Assam can be considered for admission.

The appeal was filed by M/s Arya Erectors India Pvt. Ltd. against an order dated 21.09.2022 passed by the RERA, Assam wherein it had directed the builder to pay the buyer of a villa interest on Rs. 1.5 Crore with effect from 28/08/2020 until the handing over of possession of the villa. In addition, an amount of Rs.1 lakh was also imposed on the builder by way of penalty.

The Tribunal ruled that under the proviso to sub-section (5) of section 43 of the Real Estate (Regulation and Development) Act, 2016, firstly, where penalty has been imposed by the RERA and the same is put to challenge by a promoter by way of appeal before the REAT, the promoter must first deposit with the Appellate Tribunal at least 30% of the penalty or such higher percentage as may be determined by the Appellate Tribunal. Secondly, where challenge is also made to an order asking the promoter to make payment of the total amount to the allottee, including interest and compensation, if any, the promoter has to deposit the said total amount before the appeal is heard. As the statute vests no discretion with the Appellate Tribunal to accept any deposit other than at least 30% of the penalty imposed along with the total amount to be paid to the allottee by way of interest, it was held that the promoter must first deposit with the Appellate Tribunal Rs. 32,32,850/-, the requisite statutory amount, before the appeal could be entertained or heard on merits by the Tribunal.

While passing the order, the Tribunal drew strength from the law laid down by Hon’ble Supreme Court of India vide Judgment dated 11/11/2021 in Newtech Promoters and Developers Pvt. Ltd. v. State of UP and others wherein it held that pre-deposit, as envisaged under Section 43(5) of the Act, in no circumstances can be said to be onerous or in violation of Articles 14 or 19(1)(g) of the Constitution of India.

The Tribunal asked M/s Arya Erectors India Pvt. Ltd. to pay the total amount within three weeks.
The order was passed by Mr. Justice (Retd.) Manojit Bhuyan, Chairperson and Shri Onkar Kedia, Member, Assam REAT.

press release