RERA remedies can be pursued along with those under Consumer law, Regulatory Authority cannot be single member: Punjab & Haryana High Court

In two judgments passed on October 16, the Punjab and Haryana High Court clarified crucial aspects concernng the Real Estate (Regulation and Development) Act (RERA).

. The judgments were pronounced by a Bench of Justices Dr S Muralidhar and Avneesh Jhingan.

. The two judgments answered the following questions, among others:

Whether there is an overlap between the powers of the Real Estate Regulatory Authority (the Authority) and the Adjudicating Officer (AO)?

Whether remedies under the RERA may be pursued along with those under the Consumer Protection Act?

Can the Authority be manned by a single member?

. Judgment 1: Experion Developers Pvt. Ltd. v. State of Haryana and Ors.

. Whether there is an overlap between the powers of the Real Estate Regulatory Authority (the Authority) and the Adjudicating Officer (AO)?

. Harmoniously construing Section 71 with Sections 12, 14, 18, and 19 of the RERA, the High Court ruled that the AO could determine rates of compensation and interest payable upon a default by a promoter of a housing project.

. Section 71, which delineates the scope of the AO's authority, states that the scope of an AO's authority was to adjudge compensation or interest. Only the promoter could be proceeded against when the AO was approached, the Court emphasized.

. If the homebuyer wished for further remedies, he would have to approach the Authority, who was endowed with a wider range of powers under the legislation under Sections Sections 31, 34 (f), Sections 35, 36 and 37. The remedy could be sought against a promoter, an allottee of a house, or a real estate agent as was required. The Act gave the Authority the trappings of a Court, and authorised it to issue directions and interim orders, the Court expounded.

. However, it was not a substitute for the High Court, though the Chief Justice of the High Court would have the authority to appoint the Chairperson (who did not have to have legal knowledge). The Court emphasized that the scheme of the legislation made the decision of the Authority subordinate to the Appellate Tribunal and the High Court. Therefore, its orders were subject to judicial review, it was concluded.

. The Act requires the AO to be a retired or sitting district judge, the Court underscored.

. Quelling the contention that the powers of the AO and the Authority could overlap, the Court reasoned that a person who sought compensation alone would approach the AO. The AO would then decide whether there was a contract between the promoter and the homebuyer/allottee before determining compensation.

. Where there was an omnibus relief sought, the Court stated that the homebuyer could approach the Authority, who would then refer the question concerning compensation to the AO. The preliminary question of whether there was a valid contract between the allottee and the promoter/real estate agent would first be decided by the Authority before referring the limited question of compensation to the AO, the Bench elaborated.

. Whether remedies under the RERA may be pursued along with those under the Consumer Protection Act?

. Taking the aid of Section 88 of the RERA, the Bench stated that remedies under RERA and the Consumer Protection Act could be pursued simultaneously.

. Section 88 of the RERA clarifies that its provisions would be in addition to , and not in derogation of, the provisions of other laws in force.

. However, the Court sounded a note of caution on this question, particularly on the aspect of remedies being pursued before the AO.

. If the allottee withdrew his complaint before the Consumer Forum and presented before the AO, he would only be entitled to compensation/interest, as opposed to obtaining a refund/other reliefs.

. Judgment 2: Janta Land Promoters Private Limited v. Union of India and Ors.

. Can the Authority be manned by a single member?

. The Court ruled that there was no provision in the Real Estate (Regulation and Development) Act, which envisaged either the Authority or the Appellate Tribunal to function with a single member while exercising quasi-judicial or adjudicatory functions.

. Basing its conclusion on Sections 20(2), 21, and 29, the Court ruled that the adjudicatory power of the Authority could not be transferred to a single member without express provision in the Act.

. "The provision is unambiguous that the Authority is a multimember body and that it fails to be an Authority if it is not comprised of its Chairperson and at least two whole time members . This has to be read along with Section 29 of the Act which deals with the meetings of the Authority." . Similarly referring to Section 43, the Court declared that an Appellate Tribunal was to have at least two members , one of whom was to be a judicial and other a technical or administrative member.

. "Any order passed by such Single Member Bench of the Appellate Tribunal would be null and void in law," the Court said. . Because the order appealed from as well as the original orders were passed by one-man fora, the High Court nulled them and remanded the matter back to the Authority for fresh consideration.

A Punjab RERA Regulation that permitted a Single Member to exercise adjudicatory powers was also adjudged to be void.

. Read the Judgments:

RERA remedies can be pursued along with those under Consumer law, Regulatory Authority cannot be single member: Punjab & Haryana High Court

Lydia Suzanne Thomas

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