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HIGH COURT OF KERALA
M.R.ANITHA, J
SHWAS HOMES PRIVATE LTD., REPRESENTED BY MANAGING DIRECTOR MR.SREENI PARAMESWARAN – Appellant
Versus
MOON WATERS OWNERS ASSOCIATION REPRESENTED BY ITS SECRETARY MR.MADHAVAN UNNI – Respondent
MSA 1 2023
Real Estate - Real Estate Regulation and Development Act, 2016 - Sections 3, 4(2)(i), 34, 35 - The Court analyzed the implications of registration requirements under the Act, emphasizing that previous orders' res judicata effect only applies under specific conditions and clarified the authority of K-RERA to initiate suo moto proceedings.
Fact of the Case:
Aqua City project promoters challenged the K-RERA's direction to register their project and the Tribunal's dismissal of their appeal regarding previous orders that found the project registrable under the Real Estate Act, arguing issues of authority and res judicata.
Finding of the Court:
The Court found that the K-RERA's prior order was binding and that it could not be disregarded through suo moto actions. It also determined that the order setting aside K-RERA's registrability decision was illegal.
Issues: The primary issue was whether K-RERA could initiate suo moto proceedings regarding a project's registration after both its determination of registrability and the effects of res judicata from earlier orders.
Ratio Decidendi: The Court elucidated that K-RERA's orders regarding project registration are binding unless fresh facts emerge and that suo moto inquiries are valid within its jurisdiction, dismissing the Tribunal's findings to the contrary.
Final Decision: The Tribunal's order setting aside K-RERA's previous decision on registration is reversed, and matters must be reconsidered afresh.
JUDGMENT
Dated this the 29th 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 REF
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