A project with an occupancy certificate issued prior to the enactment of the Real Estate (Regulation and Development) Act, 2016, is not classified as ongoing under the Act.

JUDGMENT

The appeal has been preferred against the order dated

08.03.2022 of the Kerala Real Estate Appellate Tribunal in REFA No.45 of 2021. The appellants had preferred a complaint before the Real Estate Regulatory Authority stating that the appellants had entered into an agreement with the respondents on 04.01.2011 for sale of a unit numbered as 12G and as per the agreement, the respondents were to provide a covered car park. It is submitted that despite several letters issued between 2011 and 2018, no covered car park has been provided and the respondents had only issued a letter permitting the use of an adjacent land for parking on a temporary basis. It is further submitted that even though there was an agreement for transfer of a covered car park, the sale deed does not take in the car parking space. According to the appellants, they had pointed out this aspect to the promoter and the promoter had assured that it will be rectified. The question to be considered is whether the project in which the appellants had purchased the apartment is an “ongoing project” on the appointed day so as to bring the project within the purview of the Real Estate (Regulation and Development) Act, 2016 (for short ‘the 2016 Act’). The respondents took the stand that the project had been completed even before the sale deed was executed and the buildings had been numbered as early as in 2010. It is hence submitted that the Act which came into effect only in 2016 will not apply to the project in question, even if the Act is to be treated as retroactive. The relevant dates for this purpose are as follows: The occupancy certificate had been obtained and building numbered on 08.09.2010. The agreement between the appellants and the respondents was executed on 04.01.2011, wherein the appellants had agreed to purchase the apartment for a consolidated sum of Rs. 35 lakhs, which includes Rs.2,25,000/- towards the undivided right in the land. The possession is stated to have been handed over on 17.05.2011. The sale deed was executed in favour of the appellants on 10.06.2011. Curiously, the sale deed does not state about the car parking space and the total consideration as per the sale deed is only Rs.21,36,600/- inclusive of Rs.2,25,000/- being the undivided share in the land.

2. I need not go into the reason for the huge reduction in the price within six months from the agreement for the sale. The fact remains that the Local Authority had issued occupancy certificate in 2010 itself. The counsel for the appellants submits that going by the decision inM/s. Newtech Promoters and Developers Pvt.Ltd. v. State of UP & Others [2021 KHC 6692] what is relevant is the issuance of the completion certificate as provided under Section 3 of the 2016 Act and so long as such a certificate has not been issued, the project is to be treated as an ongoing project, coming within the purview of the Act. Reliance is also placed on the decision of a learned Single Judge of this Court inAlfa Ventures (P) Ltd. v. State of Kerala and Others [ 2022 (5) KHC 157 ] wherein, this Court has held that the completion certificate contemplated in of the 2016 Act is distinct from the completion certificate contemplated under Section Rule 22 of the Kerala Municipality Building Rules. The learned Judge had also elucidated on the scope and ambit of the term ‘on going project’. On facts, the promoter inAlfa Ventures (Supra) had completed the project in the year 2017 and occupancy certificate was issued on 24.05.2018. It was on that fact that it was contended that the project will not come within the purview of the Act and no registration is required for the project. The court held that the completion certificate for the project was issued only on 24.05.2018. It was observed that even if the contention that the construction of the project was completed prior to 01.05.2017 is accepted in its face value, that would not satisfy the twin requirement of the first proviso, of having completed the proje