K-RERA has the authority to initiate suo moto proceedings for project registration, even in light of prior determinations, and prior orders do not serve as a barrier to their review under specific circumstances.

Headnote:(A) Real Estate (Regulation and Development) Act, 2016 - Sections 3, 4(2)(c), 34(f), and 37 - Jurisdiction of K-RERA in registering ongoing projects - The Court examined whether K-RERA has the authority to initiate suo moto proceedings regarding project registration, considering earlier findings of maintainability and compliance with statutory requirements. (Paras 3, 27, 33, 38)

(B) Res Judicata - The concept was analyzed in the context of whether earlier orders impact subsequent registrations and whether K-RERA's suo moto orders were valid. (Paras 18, 26)

Facts of the case:
The case involves the promoters' challenge against K-RERA's orders regarding the registration of the Aqua City project, which includes numerous units previously sold. K-RERA had initially ruled the project registrable under Section 3 but faced challenges regarding the suo moto ruling and its implications.

Findings of Court:
The Tribunal ruled that K-RERA acted outside its jurisdiction in reviewing its order, declaring it as non-est, thereby impacting ongoing proceedings.

Issues: The Court addressed whether an earlier order by K-RERA would constitute res judicata. This included analyzing complaints filed against the Aqua City project and K-RERA's powers in suo moto actions.

Ratio Decidendi: The Court concluded that the earlier orders do not preclude K-RERA from reconsidering issues with fresh evidence. K-RERA's authority was deemed valid when acting under suo moto clauses.

Result: Appeals allowed, and the Tribunal was directed to rehear the matters afresh.

JUDGMENT

Dated this the 29^th day of May, 2023

The above MSAs were filed against the common judgment in REFA Nos.17, 18, 27 & 30 of 2022 of the Kerala State Real Estate Appellate Tribunal, Ernakulam.

2. Heard both sides.

3. M.S.A. No.1/2023 admitted on the following substantial questions of law:

(a) Whether section 3 the Real Estate regulation and Development Act, 2016 contemplates registration when the completion of the project and issue of occupancy certificate under the relevant local law with reference to a period long before the Act?

(b) Whether standalone project means and has to be reckoned along with the sanction plan, lay out, agreement of construction advertisement of the project?

(c) Whether the certification of occupancy issued by the statutory authority can be brushed aside and ignored and required to be that complying with the Real Estate regulation and Development Act, 2016?

(d) Whether registration of the project can be directed when sanction plan, layout plan etc has expired and no declaration as contemplated under Section 4 (2)(i) could be obtained for want no new constructions being commenced or advertised and when already substantial units have been sold out years back?

(e) Whether an inquiry under section 35 is mandatory before considering and adjudicating the question as to whether a project is ongoing or not for the purpose of registration?

(f) Whether interim order survives and is binding for other proceedings before the same forum in the same subject matter, when final order is pronounced?

(g) Is the finding that the whole Acquacity township project is registrable under section 3 the Real Estate regulation and Development Act, 2016 is correct?

4. M.S.A. Nos.4 & 6 of 2023 admitted on the following substantial questions of law:

1. Whether order dated 28.04.2021 preclude K-RERA from reconsidering the question of registration of the project in the final stage?

2. Whether there is any illegality in initiating suo moto proceedings by K-RERA regarding the registration of the project, after the proceedings initiated against the appellant/promoter in the complaints and passing of order dated 28.04.2021?

5. When the appeals came up for hearing, the learned counsel for the appellants would submit that MSA Nos.4 & 6 of 2023 arouse out of the suo moto proceedings initiated by the Kerala Real Estate Regulatory Authority (in short ‘K-RERA’). While disposing the common judgment in REFA Nos.17, 18, 27 & 30 of 2022 of the Kerala Real Estate Appellate Tribunal (in short ‘the Tribunal’) found that K- RERA has no power to review its earlier order dated 28.04.2021 and hence, the suo moto order dated 21.12.2021 is without authority and is non-est in the eye of law and it has no legal effect or consequence. Hence, no argument was advanced in MSA Nos.4 & 6 of 2023 which in turn arouse out of the order in REFA Nos.17/2022 and 18/2022.

6. In REFA No.27/2022 appellants are the promoters and the respondents 1 & 2 are the associations in a tower by name Moon Waters Association and Aqua City Palm Bay Villas Owners Residence Association and respondent Nos.3 and 4 are two allotees in Moon Waters in the township called ‘Aqua City’. Three complaints 115, 116, 117 of 2020 were filed seeking registration of Aqua City township project comprising ten apartment towers and 68 Villas and other reliefs before K-RERA. K-RERA passed two interim orders issuing show cause notices to the promoters for not registering the projects on 07.11.2020 and 30.11.2020 respectively. Against which W.P.(C) No.27217/2020 was filed and this Court directed K-RERA to consider the question of maintainability of complaints and competency of complainants on hearing both sides. Thereafter, an interim order was passed on 28.04.2021 to the effect that the entire project is registrable under Section 3 of the Real Estate (Regulation and development) Act, 2016 (in short ‘the Act’). The question of maintainability was found in favour of the respondents. Against which the appellants filed

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2023 Supreme(Online)(Ker) 57929

K-RERA has the authority to initiate suo moto proceedings for project registration, even in light of prior determinations, and prior orders do not serve as a barrier to their review under specific circumstances.

Cases Referred (3)