Case Note & Summary
The case arose from a writ petition filed under Articles 226 and 227 of the Constitution of India by M/s Provident Housing Limited, a real estate developer, challenging an order of the Karnataka Real Estate Regulatory Authority (Authority) directing refund of Rs.6,84,494/- to a homebuyer. The dispute originated from an apartment project named Provident Sunworth in Bengaluru, for which the petitioner had obtained a partial occupancy certificate from the Bangalore Development Authority on 18-11-2015. The second respondent, an allottee, entered into a sale agreement and construction agreement on 10-09-2014. Subsequently, the homebuyer sought cancellation of the agreements in May 2017 on grounds that the petitioner had not acquired the land legally. The petitioner refunded Rs.17,85,212/- after deductions, and the homebuyer later approached the Authority for a refund of the deducted amount. The Authority passed an order on 30-09-2020 directing refund with interest, failing which interest at 2% per month would apply. The petitioner contended that the project was completed before the Real Estate (Regulation and Development) Act, 2016 came into force on 01-05-2016, as the occupancy certificate was issued in 2015. Hence, the project was not an ongoing project and the complaint was not maintainable. The Authority's order was alleged to be without jurisdiction. The respondent argued that the project was still ongoing because a full completion certificate was not issued, and that the writ petition was not maintainable due to the availability of an alternative remedy of appeal under Section 43(5) of the Act. The High Court considered two issues: maintainability of the complaint before the Authority and the tenability of the order. After examining the statutory provisions, particularly Section 3 of the RERA Act and the definition of completion certificate, the court held that the project had ceased to be ongoing because the occupancy certificate was issued before the Act commenced. Consequently, the complaint was not maintainable, and the order passed was a nullity. On the question of alternative remedy, the court ruled that when an order is patently without jurisdiction, a writ petition is maintainable despite the availability of an appeal, as such an order is void ab initio. The court refused to relegate the petitioner to the appellate tribunal and quashed the impugned order. The writ petition was allowed with no costs.
Headnote
A) Real Estate Law - Maintainability of Complaint - Definition of Ongoing Project - Real Estate (Regulation and Development) Act, 2016, Section 3 - The complainant entered into agreement in 2014 and a partial occupancy certificate was issued in 2015, before the Act came into force on 01-05-2016. The court examined the statutory framework and held that the Act applies only to ongoing projects where completion certificate has not been issued. Since the occupancy certificate was granted prior to the Act, the project ceased to be ongoing, rendering the complaint not maintainable before the RERA Authority (Paras 11-18). B) Constitutional Law - Writ Jurisdiction - Availability of Alternative Remedy - Constitution of India, Article 226 - The RERA Act, 2016, Section 43(5) provides for an appeal, but the court held that when an authority acts wholly without jurisdiction, the resulting order is a nullity and a writ petition under Article 226 is maintainable. The petitioner was not required to exhaust the statutory remedy of appeal, as an order without jurisdiction can be challenged directly before the High Court (Paras 19-22). C) Real Estate Law - Refund Orders - Jurisdictional Validity - Real Estate (Regulation and Development) Act, 2016, Sections 18, 31 - The RERA Authority directed refund of deducted amount with interest. The court found that because the complaint itself was not maintainable owing to lack of jurisdiction, the refund order was a nullity. The court emphasized that the amount in dispute is immaterial when the foundational jurisdiction to entertain the complaint is absent, and quashed the order (Paras 13-18, 22).
Issue of Consideration
Whether the complaint before the Karnataka Real Estate Regulatory Authority was maintainable given the timing of project completion and the Act's commencement; Whether the Authority's order was tenable in law
Final Decision
The writ petition is allowed. The impugned order dated 30-09-2020 passed by the Karnataka Real Estate Regulatory Authority is quashed. No costs.
Law Points
- Real Estate (Regulation and Development) Act
- 2016 applies only to ongoing projects
- project loses ongoing status once occupancy certificate is issued prior to Act's commencement
- order passed without jurisdiction is a nullity and can be challenged under Article 226 despite availability of alternative remedy
