IN THE HIGH COURT OF ALLAHABAD
SANGEETA CHANDRA, J.
PSA Impex Private Ltd. Thru Authorized Signatory Raj Kumar - Appellant
Versus
Real Estate Appellate Tribunal Lko. Thru Registrar And Ors. - Respondents
Second Appeal No. 121 of 2020
Decided on : 09-03-2021
Real Estate (Regulation and Development) Act - Sections 3 and 4, Section 7, Section 8 - U.P. Real Estate Regulatory Authority - Builder Buyers Agreement - Irregularities and violation of the provisions of the Act and the Rules on the part of the Promoter - Promoter indulging in several fraudulent practices - Revocation/de-register of project - Quasi judicial decisions
Finding of the Court:
Language of Section 7 of the Act and the procedure applicable to the Authority while taking decision under Section 7 does not require the Authority to act judicially. The Act only requires that where the Authority is satisfied that condition for the exercise of its power of revocation of registration of the Promoter or real estate agent exist viz. it is established that the Promoter/Real Estate Agent is adopting corrupt practices then the Authority may pass an order revoking the registration and the consequences mentioned under the Section would follow. The Authority may issue show-cause notice and consider any reply submitted to it within thirty days of issuance of notice. The Authority therefore is only required to issue notice to "further inform its mind" with regard to action proposed to be taken by it, in this case suo moto. The power under Section 7 is an Administrative Power. Therefore, the power given under Section 81 of the Act to sub delegate the actual drafting of the order giving detailed reasons for invoking its power under Section 7 of the Act against the promoter, the appellant herein, was rightly exercised by the Authority
Result: Appeal dismissed
JUDGMENT :
1. Heard the learned Senior Counsel Sri Sudeep Seth assisted by Sri Prashant Kumar, Advocate for the Appellant and Shri Shobhit Mohan Shukla, learned Standing Counsel for Real Estate Regulatory Authority (hereinafter referred to as a "the Authority").
2. The brief facts of the case as are relevant for deciding this appeal are being given here in below:-
3. A team was constituted of the Chief Engineer as the Technical Adviser, along with another Junior Engineer and it was found by the said team that although the Project was registered as "Sampada Livia" and the Promoter's name was given as PSA Impex Private Limited, the board on the site showed the name as "Alturio Residency". The approved plan had not been uploaded on the R.E.R.A. website. The Project completion date was 30.11.2019, however, on 24.2.2019, when the Team inspected the Project and tried to call the Project Coordinator on his mobile number, the same was found to be switched off and the on site inspection showed that the work had been stopped as no construction material was available on the site and only 10% of the structural work on the Project was completed. There were two floors built in Tower A, seven floors built in Tower B, six floors built in Tower C, and only basement was built in Tower D. There were other Towers to be built which had not even been started. It had become evident from the spot inspection report dated 26.2.2019 submitted along with photographs, that there was no likelihood of the Project being completed within time and the flats being handed over to the allottees. The security guard on the site revealed that work had stopped on the Project for the past two years.
4. The Authority surmised that in all likelihood, the hard earned money of the allottees had been diverted unauthorisedly by the Promoter. On the request of the Authority, an audit of the Project was got conducted by the Chief Executive Officer of Greater Noida through M/s. Currie and Brown Auditors, who submitted a report that about Rs.47 Crores of a Nottees' money had been diverted. Because of the complaints made by the allottees and on the spot inspection report as well as the Auditors report and because of the incomplete details of the Project being uploaded on the website, the Authority had come to a, prima facie, satisfaction that the Promoter had violated the conditions of registration and the conditions for revocation of registration under Section 7(1)a, 7b, 7c and 7d existed for the Authority to issue a show cause notice under Section 7(2) of the Act to the Promoter to show cause why its registration may not be revoked. The reply to the notice had to be submitted within 30 days of issuance of such notice.
5. A reply to the said show cause notice was submitted on 5.4.2019, and supplementary replies were submitted on 30.4.2019, 6.5.2019, 13.5.2019. Another notice was issued to the Promoter on 17.05.2019 asking for
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Barium Chemicals Ltd. And another Versus Company Law Board and others reported in AIR 1967 SC 295
Gullapalli Nageswara Rao versus Andhra Pradesh State Road Transport Corporation
Harishankar Bagla Versus State of Madhya Pradesh AIR 1954 SC 465
Jagannath Temple Managing Committee Versus Siddha Math and Others reported in 2015 (16) SCC 542
Province of Bombay vs. Kusaldas S. Advani and others
Paramjit Singh Patheja v I.C.D.S Ltd. 2006 10 JT 41
Radeshyam Khare and another vs. State of Madhya Pradesh and others
Rajendra Pratap and others vs. Sadasiva Rao KTSSK Ltd.; (2012) 4 SCC 781.
State of West Bengal Vs. Subash Kumar Chatterjee and others
Sahni Silk Mills Pvt. Ltd. vs. Employees' State Insurance Corporation; 1994 (5) SCC 346.
State of Himachal Pradesh vs Raja Mahendra Pal
Sri Sitaram Sugar Company Ltd. and another vs. Union of India and others
State of West Bengal vs. Subhash Kumar Chaterjee; (2010) 11 SCC 694.
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