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

The Assam Real Estate Appellate Tribunal (REAT) has ruled that a housing project will not require to be registered if it received Occupancy Certificate or deemed approval for occupation prior to 1st August, 2017. The ruling was given by the Tribunal today while deciding an appeal filed by M/s. Saraighat Builders Pvt. Ltd. against a decision of the Real Estate Regulatory Authority(RERA), Assam.

Section 3 of the Real Estate (Regulation and Development) Act 2016 stipulates that the promoters of the real estate projects which were ongoing on the date of the commencement of the Act and for which Completion Certificate had not been issued were required to make an application to the concerned RERA for registration of the projects within a period of 3 months from the date of commencement of the Act. Under the Guwahati Building Construction (Regulation) Act, 2010 and the Guwahati Building Construction (Regulation) Byelaws, 2014, it is only an “Occupancy Certificate” and not a “Completion certificate” that can be issued by the concerned civic authority. Further, as per the Guwahati Building Construction (Regulation) Act, 2010, if the work is not inspected and an Occupancy Certificate is not granted or refused within 21 days from the date of receipt of Completion Certificate from the owner, it shall be deemed that approval has been tendered, permitting occupation of the building concerned.

In Assam, Section 3 of the Real Estate (Regulation and Development) Act 2016 came into force with effect from 01.05.2017. Therefore, an ongoing project was required to make application to the RERA, Assam for registration within a period of 3 (three) months, i.e., by 01.08.2017.
In the case of M/s. Saraighat Builders Pvt. Ltd., the RERA Assam held that they had applied for occupancy certificate of part of their project ‘Radha Niketan’ on 30.06.2017. Since on 1st May,2017, it was an ongoing project, it required to be registered. The RERA,Assam imposed a fine of Rs.2,50,000.00 on the promoter for the violation and directed him to apply for registration of the project.

While deciding the appeal against the order, the Tribunal held that if before initiating the process for registration within the three-month window, the concerned project or part of it receives an Occupancy Certificate or if occupation of the building is deemed to have been approved, that part of the project/building must be considered to have been completed and would not require registration. Setting aside the order of the RERA, Assam, the Tribunal held that the real estate project of the appellant did not require registration, as it received deemed approval within the three-month window, i.e. prior to 01.08.2017.

The Tribunal further clarified that cut-off date for receiving Occupancy Certificate has to be 01.08.2017 and not 01.05.2017 which would take within its fold a deemed approval for occupation.
The order was passed by Mr. Justice (Retd.) Manojit Bhuyan, Chairperson and Shri Onkar Kedia, Member, Assam REAT.

Press Release

The onus is on the promoter to draw up and enter into the Agreement for Sale with an allottee strictly as per the form given at Annexure ‘A’ of the Assam Real Estate (Regulation and Development) Rules, 2017. This was stated by the Assam Real Estate Appellate Tribunal (REAT) while disposing of an appeal filed by a Guwahati-based promoter against an order, passed by the Real Estate Regulatory Authority (RERA), Assam.

In this case, a couple had entered into a registered Agreement for Sale with the Promoter on 31.10.2017 to purchase a residential flat in an RCC building at Chatribari, Guwahati. The allottees approached the RERA, Assam with a number of grievances against the Promoter. In their final order passed on 07.12.2022, as many as 29 directions were passed by the RERA for due compliance by the Builder. One of the directions was imposition of a penalty of Rs.50,000/- on the builder for not signing the Sale Agreement as per the prescribed format. The builder filed an appeal before the Assam REAT against this order.

In its order delivered today, the Tribunal rejected the contention of the builder that although the Agreement for Sale did not conform to the prescribed form, no mala fide was intended and that both parties had entered into the Agreement with open eyes. The Tribunal also rejected the contention that any shortcomings in the Agreement can always be rectified at the time when the Conveyance Deed is executed by the parties.

Giving reasons in support of its order, the Tribunal stated that Sub-section (2) of Section 13 of Chapter III of the Real Estate (Regulation and Development) Act, 2016, under the heading “FUNCTIONS AND DUTIES OF PROMOTER” provides that the Agreement for Sale shall be in such form as may be prescribed. Sub-rule (1) of Rule 9 of the Assam Real Estate (Regulation and Development) Rules, 2017 accordingly prescribes the form in Annexure ‘A’. On a harmonious reading of both the provisions, the onus is upon the Promoter to draw up and enter into the Agreement for Sale with an allottee strictly as per the form given at Annexure ‘A’.

The order was passed by Mr. Justice (Retd.) Manojit Bhuyan, Chairperson and Shri Onkar Kedia, Member, Assam REAT. The full text of the order is available at reat.assam.gov.in, the official website of the Tribunal.

(Press Relase)