2020 (9) TMI 1317 - HC - Indian Laws

Dismissal of an appeal preferred under Section 44 of the Real Estate Act for non-compliance with a pre-deposit order passed by RERA Appellate Tribunal - HELD THAT - Prima facie all ingredients of promotership of the Appellant are satisfied in the present case and there is no reason why its appeal before the Appellate Tribunal should not be treated as an appeal filed by a promoter. Whether the original complaint before the adjudicating officer was premature and whether damages/compensation awarded by the adjudicating officer were within his jurisdiction, are but matters of merit in the appeal. These matters, even if some of them may go to the root of the order impugned in the appeal, do not call for dispension of pre-deposit under the proviso to sub-section (5) of Section 43, which is mandatory. There is, in the premises, no infirmity in the impugned orders passed by the Appellate Tribunal. The orders do not give rise to any substantial question of law for the consideration of this court. The Second Appeal is, accordingly, dismissed. Appeal dismissed.

Summary

Issues:
Dismissal of appeal for non-compliance with pre-deposit order under Section 44 of Real Estate Act; Applicability of pre-deposit under proviso to Section 43(5) of the Act; Nature of agreement between parties; Jurisdiction of adjudicating officer to award damages; Challenge to impugned orders of Appellate Tribunal.

Analysis:

The judgment pertains to a second appeal arising from the dismissal of an appeal under Section 44 of the Real Estate Act due to non-compliance with a pre-deposit order issued by the RERA Appellate Tribunal. The respondent, an original complainant, alleged non-compliance with an agreement for sale dated 10 December 2009, concerning the purchase of land and a warehousing building. The adjudicating officer ordered the appellant to pay compensation and hand over possession, a decision challenged before the Appellate Tribunal. The Tribunal, after considering a waiver request for pre-deposit, ordered the appellant to deposit 50% of the amount as a condition for appeal consideration. As the appellant failed to comply, the appeal was dismissed, leading to the current challenge.

The appellant argued against the pre-deposit requirement under Section 43(5) of the Act on three grounds. Firstly, contending not being a promoter due to the nature of the agreement as a partnership settlement; secondly, challenging the prematurity and merit of the respondent's claim; and thirdly, questioning the jurisdiction of the adjudicating officer to award damages. However, the court found these arguments irrelevant to the pre-deposit issue, emphasizing the agreement as an instance of allotment and sale, fulfilling the criteria of promotership and necessitating compliance with the pre-deposit condition.

The court further clarified that the merit-based arguments raised by the appellant did not negate the mandatory pre-deposit requirement under the Act. While acknowledging the potential significance of these arguments in the appeal's merit, they did not warrant exemption from the pre-deposit condition. Consequently, the court upheld the impugned orders of the Appellate Tribunal, finding no substantial legal question for consideration, and dismissed the second appeal.

In light of the dismissal, an interim application was disposed of, granting the appellant four weeks to pay the amount ordered by the adjudicating authority. The court directed that no sale of attached property should occur during this period. The appellant's request for a stay was deemed unnecessary due to the provided payment timeline. However, it was cautioned that failure to pay within four weeks would allow the executing authority to proceed with the sale of the attached property. The order concluded with administrative instructions for digital signing and dissemination.