IN THE HIGH COURT OF KERALA AT ERNAKULAM
M.A. ABDUL HAKHIM, J.
P.V. NIDHISH S/O. P.V. CHANDRAN – Appellant
Versus
SIVAPRAKASH S/O KRISHNAN – Respondent
MSA No. 14 of 2024
Decided On : 30-08-2024
RERA - Real Estate - Section 3 - The court interpreted the provisions of the Real Estate (Regulation and Development) Act, 2016, particularly Section 3, clarifying the conditions under which a project is considered ongoing and the implications of the Completion Certificate on registration requirements.
Fact of the Case:
The complainant, an Apartment Owners Association, sought a conveyance deed for common areas from the respondent, who claimed the project was not ongoing and thus not subject to RERA registration. The K-RERA initially dismissed the complaint, leading to appeals and remands regarding the project's status and documentation.
Finding of the Court:
The court found that the Tribunal's remand order was valid, allowing for the consideration of Commission and Expert Reports to determine if the project was ongoing, contingent on the proof of the existence and dates of the Occupancy Certificates.
Issues: The main issues were whether the project was ongoing under Section 3 of RERA and the relevance of the Completion Certificate in determining registration requirements.
Ratio Decidendi: The court held that the issuance of a Completion Certificate before the commencement of RERA is decisive in determining whether a project is ongoing, and that both limbs of the Proviso to Section 3(1) must be read conjunctively.
Result: The appeal is allowed in part, modifying the Tribunal's order regarding the consideration of evidence related to the project's status.
JUDGMENT :
M.A. ABDUL HAKHIM, J.
1. The appellants are the legal heirs of the respondent in Complaint No. 17/2020 of the Kerala Real Estate Regulatory Authority (‘the K-RERA’ for short).
2. The complainant is the Apartment Owners Association of the project of the respondent by name ‘Orchid Garden-PVS Park’ located at Govindapuram, Kozhikode. The Complainant/Association sought direction to the respondent to execute a registered conveyance deed in favour of the Association with respect to the undivided proportionate title in the common area in accordance with the Rules and to direct the respondent to handover all the relevant original documents in connection with the entire apartments.
3. The main grievance of the complainant is that the project of the respondent consisted of four blocks namely, A, B, C, and D, having a total number of 64 flats in a total area of 167 cents, that the common area for the above four blocks is included in the 167 cents, but the respondent used only 126 cents for the said blocks and common area and the balance 41 cents are in the possession of the respondent and the respondent is trying to make new construction therein without handing over possession of the common area and without delivering the documents such as Building Permit, Sanctioned Plan, Deeds, Occupancy Certificate, NOC from Pollution Control Board to the complainant.
4. The respondent opposed the prayers in the complaint stating that the complaint is filed under the mistaken impression that the entire 167 cents of land owned by the respondent is intended for construction of the four blocks that have been built by the respondent; that, in fact, the total land was intended for construction of five blocks as can be seen from the approved plan and permit issued by the local authority; that 41 cents situated at the southern extremity is proposed for future development; that the allottees of units in the four constructed block have no right over the 41 cents which is not the part of the site of their blocks. The complainant has only the right of usage over all the common areas excluding 41 cents demarcated in the approved plan intended for future development.
5. When the complaint was pending enquiry, the K-RERA by its order dated 5.03.2020 prima facie found that the project in question is registrable under Section 3 of the Real Estate (Regulation and Development) Act, 2016 (‘the RERA’ for Short) and thereupon directed the respondent to file an application for registration within two weeks from the date of order. The respondent filed a Statement dt. 19.03.2020 stating that the project is not an ongoing one but a finished project before coming into force of the RERA and that, therefore, the respondent is not liable for registration. The respondent was directed to produce the original Occupancy Certificate which he claimed to have obtained in the year 2009. On 16.10.2020, the respondent filed an Affidavit before the K-RERA affirming that the Occupancy Certificate was issued 12 years ago and, hence, he is not in possession of the same. The K-RERA marked the copies of the Occupancy Certificates produced by the respondent as Exts.B5 to B8. The K-RERA directed the Secretary Kozhikode Corporation to submit a Report declaring the date of issue of all the Occupancy Certificates with regard to four blocks of the project. The Secretary of the Kozhikode Corporation submitted Ext.X1 Report dated 06.01.2020 stating that the Corporation does not have the file relating to the Occupancy Certificates with regard to the Project. After hearing both sides and taking the evidence into consideration, the K-RERA by its order dated 15.11.2021 found that the complaint is not maintainable as the project is not an ongoing project, since the apartments were transferred to the allottees, numbered in their names and property tax was assessed and collected long before coming into force of the RERA. However, the K-RERA granted a relief in favour of the complainant that the members of
Baiju M. v. Secretary, Kozhikode Municipal Corporation
Graceland Foundation v. Kerala Real Estate Regulatory Authority
Sheela N. v. Kollam Municipal Corporation and another
Union of India and another v. Suhrid Geigy Ltd. 1997 (11) SCC 657
The court clarified that the Completion Certificate's issuance date is crucial in determining a project's ongoing status under RERA, emphasizing the conjunctive reading of statutory provisions.
The existence and date of issuance of occupancy certificates are critical in determining whether a real estate project is ongoing under the RERA.
The Real Estate (Regulation and Development) Act mandates registration for ongoing projects, where completion certificates are absent, emphasizing consumer protection in real estate transactions.
The court affirmed that ongoing real estate projects must be registered under RERA to protect allottee interests, regardless of title transfer.
A project completed before the commencement of the Real Estate Act is not subject to the Act's registration requirements, regardless of later safety certificate issues.
The completion certificate issued must be strictly in accordance with the sanctioned plan and specifications, and the responsibilities of the promoter include providing and maintaining essential serv....
Projects receiving partial occupancy certificates prior to enactment are exempt from certain provisions of Real Estate (Regulation and Development) Act.
RERA applies to ongoing projects regardless of completion status, ensuring consumer protection and allowing for grievances to be raised under its provisions.
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