The complaints under Section 12 were thus held to be required to be filed only before the Adjudicating Officer, being the authority empowered to grant compensation under the Act

 In the Matter of Sandeep Mann vs. Real Estate Regulatory Authority, Punjab and Anr. Complaint no. Appeal No. 53 of 2018 decided on 27.02.2019 before  Punjab Real Estate Appellate Tribunal

The issue that arose in the batch matter of fifteen appeals was as to the forum (as between the Real Estate Regulatory Authority constituted under Section 20, and the Adjudicating Officer appointed under Section 71) before which a person aggrieved by violations and contraventions enumerated in Section 11(5), 12, 14(3), 18(1), 18(2), 18(3), 19(4) and 19(7) of the RERA, 2016 or the agreement for sale, praying for reliefs of refund, return of investment including compensation, setting aside of order of cancellation of allotment, compensation, compensation and interest, compensation or interest and interest as a separate relief may file a complaint.The question arose on account of two circulars issued by the Authority declaring that complaints for compensation shall be filed before and adjudged by the Adjudicating Officer whereas all other complaints shall be filed before and adjudicated by the Authority. Following these circulars, one set of orders came to be passed by the Adjudicating Officer, whereby the complaints claiming relief of refund, interest and compensation came to be dismissed for lack of jurisdiction. Another set of orders were those which the Authority passed, rejecting the complaints which alleged

violations and contraventions of the Act, while granting liberty to approach the Adjudicating Officer. All these orders were subject matter of the appeal decided by the Appellate Tribunal.

The Appellate Tribunal after considering the provisions of the Act came to the conclusion that:

(i) In case of Section 11(5), no difficulty arose, in view of the fact that the said provision specifically mentioned the Authority as the forum, before which a complaint could be filed by a complainant aggrieved by cancellation of allotment by the promoter;

 

(ii) Section 12 provides for compensation on account of false advertisement, and also for refund of investment along with interest, in case of a complainant who desires to withdraw from the project on account of false advertisement. The nature of relief being different, the circulars issued by the Authority provided for adjudication of the complaint based on the same cause of action (viz., false advertisement) by two different authorities (viz., the Adjudicating Officer for compensation and the Authority for refund of investment). The Appellate Tribunal held this mechanism to be flawed, inter alia, on account of the fact that it raised the possibility of differing orders being passed by the two authorities. Further, the cause of action being the same, the fact that the complainant had a choice of relying would not change the nature of the proceedings. The basis of the proceedings was adjudication of the proof of default. The complaints under Section 12 were thus held to be required to be filed only before the Adjudicating Officer, being the authority empowered to grant compensation under the Act;

(iii) Section 14(3), like Section 11(3), was held not to pose any problem on account of the fact that the use of the words ‘shall be entitled to receive appropriate compensation in the manner as provided under this Act’ could only mean that the appropriate forum was the Adjudicating Officer, viz., the authority empowered to award compensation under the Act;

(iv) Section 18(1), the cause of action for which is the inability of the promoter to give possession due to any of the reasons specified therein, provides an option to the buyer to withdraw from the project and seek return of investment with interest including compensation in the manner prescribed in the Act, thereby meaning that the Adjudicating Officer shall have power to adjudicate the complaint. In a case covered by the proviso, however, viz., one where return of investment is not sought and the allottee is entitled to interest till possession, the appropriate forum was the Authority; (v) Sections 18(2) and (3) provide for compensation in terms of the Act for the default of the promoter for the reasons specified therein, and therefore the appropriate forum was the Adjudicating Officer, it was held by the Appellate Tribunal;

(vi) A complaint under Section 19(4), which made a reference to award of compensation, was held to be required to be placed before the Adjudicating Officer, while one under Section 19(7), which imposed a liability upon the allottee to pay interest on delayed payments to the promoter, was required to be filed before the Authority.

Based on the above findings, the appeals came to be allowed. The Appellate Tribunal did however clarify that the decision of the Tribunal was not to apply to matters which had attained finality. The pending complaints/ applications were to be transferred to the appropriate forum as per the findings set out above.

The Complete order can be accessed at https://rera.punjab.gov.in/pdf/OrdersJudgementsPbAT/20190405PbATAppealNo11to56of2018.pdf

in the absence of any pleadings or material placed on record for award of compensation on account of mental agony, compensation ought not to have been awarded.

 In the Matter of Estate Officer vs. Real Estate Regulatory Authority, Punjab and Anr. Complaint no. Appeal No. 65 of 2019 decided on 01.07.2019 before Punjab Real Estate Appellate Tribunal

In this case, the RERA Appellate Tribunal was called upon to examine the correctness of an order of the Adjudicating Officer, vide which compensation had been awarded under Section 72 of the Act on account of two heads, viz., mental agony and litigation expenses. While passing the Order for compensation, the Adjudicating Officer had opined that since the Act did not define the term compensation, and had thought fit to draw upon the scheme of Workmen’s Compensation Act, 1923, the Motor Vehicles Act 1988 and the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 for settling the claims for compensation. 

The Appellate Tribunal held:

(i) The objects and reasons in the matter of award of compensation under those enactments acts have no connection even remotely with the award of compensation under the RERA and to draw a corollary from the said enactments for considering the award of compensation was wrong and illegal;

(ii) Section 72 of the Act operates a self contained code for consideration of the factors to be taken into account while deciding the quantum of compensation. In support of this proposition, the Tribunal also relied on the previous decision in the same matter, wherein it had been concluded by reference to Section 72(d) that the factors enumerated in the said provision were not exhaustive;

(iii) that in the absence of any pleadings or material placed on record for award of compensation on account of mental agony, compensation sought not to have been awarded. It was found that in order to support the plea of compensation, only a bald statement had been made and no material was placed on record to support the case of loss suffered on account of interest paid for bank loan availed. The Tribunal also relied on Bhavnagar University vs. Palitana Sugar Mills Pvt. Ltd. 2003 (2) SCC 111, for the proposition that when a statutory authority is required to do a thing in a particular manner, the same must be done in that manner or not at all. 

The award of compensation on account of litigation expenses was upheld, while that on account of mental agony was set aside.

Appellants, having accepted a part of benefit, are not permitted to approbate and reprobate also they can not be permitted to resile from their earlier stand. Therefore, the Appellant has to be estopped from claiming again.

 In the Matter of S.Dominic Savio and Anr. vs. Phoenix Serene Spaces Pvt. Ltd. Complaint no.Appeal No. 64 of 2019  decided on 28.02.2020 before Tamil Nadu Real Estate Appellate Tribunal

The Appellant entered into an agreement with the Respondent for a flat in the project of the Respondent. The apartment was to be completed by 31.12.2015 with a grace period of six months. However, the unit was not delivered on time and the Respondent agreed to cancel the allotment on 05.05.2018, refunding the principal amount in three installments. In December 2018, the Appellants approached Respondents for refund of interest, for which the Respondent refused. Being aggrieved, complaint was filed before Adjudicating Officer for interest and compensation. The said complaint was dismissed by the Adjudicating Officer. In the present Appeal, it is contented by the Appellants that Respondent visited their offices and homes to deliberate on the refund process and due to the mental pressure and undue influence exerted by the Respondents, they were forced to accept foregoing interest and compensation and agreed for refund of principal only to free themselves from the mental agony. The Tribunal after going through the communication between the Appellant and the Respondent over a period of time held that there was no undue influence or undress. The said communication clearly reflected that Appellants voluntarily asked the Respondents to cancel the allotment, refund the money without any deduction, promising to forego their claim of interest and compensation. Further, it was held that the action of the Appellants was an afterthought, since they had waived their right of interest and compensation due to their agreement with the Respondent. The Appellants in this case, having accepted a part of benefit could not to be permitted to approbate and reprobate nor can they be permitted to resile from their earlier stand. Therefore, the Appellant was estopped from claiming again. 

Grant of relief of compensation can only be adjudicated by the adjudicating officer,if compensation is provided as a part of the multiple reliefs, the complaints have to be placed before the adjudicating officer.

 In the Matter of Sameer Mahawar Vs. MG Housing Pvt. Ltd. Complaint no. appeal no. 6/2018 decided on 02.05.2019  before Haryana Real Estate Appellate Tribunal

In this order after taking into consideration the provisions of Sections 11(4), 12, 14, 18, 19, 31, 34(f),  37, 38 and 71 of the Real Estate (Regulation and Development) Act, 2016 (hereinafter called the Act) and rule 28 & 29 of Haryana Real Estate (Regulation and Development) Rules, 2017 (hereinafter called the rules). The Honourable Appellate tribunal added that. “ Thus, as a result of our aforesaid discussions, we conclude and sum up our considered view in following manner :-

(i) That violations and causes of actions arising out of the same bundle of facts/rights giving rise to the multiple reliefs shall be placed before one and the same forum for adjudication in order to avoid the conflicting findings. 

(ii) The complaints for the grant of relief of compensation can only be adjudicated by the adjudicating officer as per the provisions of section 71 of the Act and rule 29 of the Rules. 

(iii) Similarly, if compensation is provided as a part of the multiple reliefs alongwith refund/return of investment with interest flowing from the same violation/violations and causes of action, the complaints have to be placed before the adjudicating officer exercising the powers under 3 Sections 31, 71(1) read with rule 29 of the Rules as only the adjudicating officer is competent to deal with the relief of compensation.”

Karnataka Rera - No Compensation is payable for mental agony in case of breach of a contract.

 In the Matter of Suman Rupanagudi vs. Adarsh Developers Complaint no. CMP/190912/0004118 decided on 31.01.2020  before Karnataka Real Estate Regulatory Authority

Karnataka RERA tried to clear this ambiguity by placing reliance on the judgment of the Hon’ble Supreme Court of India in Ghaziabad Development Authority vs. Union of India. (2000)6 SCC113 The Hon’ble Supreme Court, while considering a case of breach of contract under Section 73 of the Indian Contract Act, 1872, held that no damages are payable for mental agony in case of breach of a contract.

In Lucknow Development Authority vs. M.K. Gupta,AIR1994 SC 787 the Hon’ble Supreme Court of India held that the liability for mental agony had been fixed not within the realms of contract but under the principles of administrative law.

In view of the same, Karnataka RERA refused to grant relief towards mental agony

The Authority has Jurisdiction to decide the matters between the Allottee and promoter , though their agreement has an arbitration clause in it.

In the Matter of Sarita Bhairu Chandekar & oth Vs Prashant Bhandari Complaint number CC005000000022925 decided on 11.11.2019  before  Maharashtra Real Estate Regulatory Authority

The Authority Relied on the Judgment by Supreme Court in the matter of HDFC Bank Ltd-v/s-Satpal Singh Baxi (MANU/DE/5308/2012) in which the Supreme Court also held that if particular enactment creates special rights and obligations and gives special power to the Tribunal which are not in Civil Court such as tribunal constituted under Rent Control Act and the Industrial Disputes Act, the dispute arising under the said enactments cannot be arbitral otherwise other disputes are arbitral.

In Hemangi Enterprise-v/ s-Kamaljeet Singh Ahluwalia 2017 STPL 13227 SC, the Supreme Court found that the dispute between the parties was that of the tenant and landlord relating to leave and license agreement and therefore exciusive jurisdiction to deal with such dispute is conferred upon the Court of Small Causes and therefore, though there wasthe Arbitral Clause in the agreement, the Court held that the dispute was not arbitral. 

As per the Court

• Section 20 of RERA has special powers

• under Section 31 of it to adjudicate the dispute between the aggrieved person on one hand and the promoter, allottee, real estate agent on the other for violation or contravention of the provisions of RERA, Rules and Regulations made thereunder.

• Section 32,34,35 are the special provisions.

• Section 79 of RERA bars the jurisdiction of Civil Court from entertaining any matter which the Authority is empowered under the Act to determine.

• Section 59 lo 69 relates to the offences and penalties.

• A Special Forum of Adjudicating Officers whose qualification is that of District Judge has been set up by Section 71 of RERA to decide the matters arising out of Section 1.2, 74, 78 & 19.This case arises out of Section 18 of the Act for which a separate special forum has been provided by RERA and hence, the jurisdiction lies with the Authority and it cannot be delegated to the Arbitrator despite the provisions of the Arbitration and Conciliation Act and the Arbitration Clause of the agreement. Hence, Court did not find any force in the respondents' submission that this Authority has no jurisdiction. The Court finds that the Authority has jurisdiction to entertain this complaint.

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Rajasthan RERA - Complaint under Section 12 will not be dealt by the Authority and has to be compulsorily put before the Adjudicating Officer.

 In the Matter of Amit Kumar Lamba V/s Shekhar home Developers Complaint no.RAJ-RERA-C-2018-2193  decided on 23.04.2019 before Rajasthan Real Estate Regulatory Authority

The Bench of Sh. Nihal chand Chairman and and Rakesh jain member held that

Complaint for Relief under Section 12, Section 14(3), Section 18(2) and Section 18(3) are to be filed with and disposed of by the adjudicating officer alone, in the manner prescribed in the Rule 36 of the Rules. 

Complaints for Relief under Section 14(1) , Section 14(2) , Section 19(16) to 19(11) are to be filed with and disposed of by the Authority alone, in the manner prescribed in the Rule 35 of the Rules.

As regards to complaint under Section 18(1), the Complaint is to be filed with and disposed by authority if the complaint pertains to refund, interest , penalty or of other other directions.

The Complaint under Section 18(1) is to be disposed by the Adjudicating officer if the complaint pertains to the compensation only.

The copy of Detailed order can be found at https://rera.rajasthan.gov.in/Content/pdf/2018-2193%20001-converted.pdf

Adjudicating Officer Under RERA is only Empowered to Adjudge Compensation Under Section 71 and Section 72 of the RERA and does not have Jurisdiction to decide Matters for Allowing Refund Under Section 18 of the RERA

The Maharashtra Real Estate Appellate Tribunal, Mumbai (“Appellate Tribunal”), in the matter of Xrbia Developers Ltd. v. Firoz Aziz Shaikh (“Appeal”), has, inter alia, held that the Adjudicating Officer (“AO”) under RERA is only empowered to adjudicate on the compensation to be granted under Section 71 and Section 72 of the RERA. 

The Hon’ble Appellate Tribunal has further held that the jurisdiction to adjudicate on the matters relating to refund with interest under Section 18 of RERA vests with Adjudicating Authority. 

The Hon’ble Appellate Tribunal, whilst deciding the issue of sustainability of the order passed by AO in the complaint preferred by the allottee seeking refund with interest along with other reliefs had held that, 

“11. Considering the legal position discussed and held as above, it is crystal clear that AO has powers only to adjudge compensation under Sections 71 read with 72 of RERA and has no jurisdiction to decide matters for allowing refund with interest under Section 18 which is vested with the Authority only. Consequently, the order passed by AO with regard to subject matter involved in the above complaint is obviously without jurisdiction as per provisions of RERA. It is a fundamental principle well established that an order passed by a forum having no jurisdiction over subject matter is a nullity. An objection to lts valldity can be raised at any time including the appeal proceedings. For the said reasons, the impugned order passed by AO cannot be sustained and therefore is liable to be quashed and set aside being a nulllty for lack of jurisdiction of subject matter as contended by Promoter, We answer the point accordingly.”