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2021 Supreme(All) 1104

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

Advocates:
Advocate Appeared:
For the Appellant : Prashant Kumar
For the Respondent: Shobhit Mohan Shukla

Point of Law: where there are two or more parties contesting each other's claim and the statutory authority is required to adjudicate the rival claims between the parties, such a statutory authority was held to be quasi judicial and the decision rendered by it a quasi judicial order. Where there is a lis or two contesting parties are making rival claims and the statutory authority under the statutory provision is required to decide such a dispute, in the absence of any other attributes of a quasi judicial authority, such statutory authorities acquire the quasi judicial authority. There are other cases where there is no lis or two contending parties before statutory authority, yet such a statutory authority has been held to be quasi judicial and the decision rendered by it as quasi judicial decisions when such a statutory authority is required to act judicially.

Headnote:

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:-

    On 18.3.2019, by Letter No.905, the Authority at Gautam Budh Nagar issued a show cause notice to the Appellant under Section 7 of the Act of 2016. The show cause notice has been annexed as Annexure-7 to the Application for Interim Relief. The Promoter had got the Project registered as Sampada Livia under Sections 3 and 4 of the Act, with registration No.UPRERAPRJ5855. The commencement date for the Project was mentioned as 01.12.2014 and date of completion was mentioned as and 24 allottees had approached the Authority by filing complaints against the violations of the Builder Buyers Agreement (hereinafter referred to as 'BBA') by the Promoter. During the course of enquiry into the complaints made by the allottees under Section 38 of the Act, it was found that even the necessary conditions for registration of the Project as mentioned in Rule 14 had not been met and required details were not uploaded on the R.E.R.A. Website. There were no regular progress reports uploaded either. It was, therefore, decided to get an on the spot inspection done of the Project site.

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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