Can Real Estate Adjudicating Officer Award Compensation After Handing Over of Possession? All HC Answers
In a recent Judgment, the Allahabad High Court has held that the Adjudicating Officer under Real Estate (Regulation and Development) Act, 2016 has the power to award compensation even after the handing over of possession of flat.
Brief Facts of the case:-Vibhor Vaibhav Infrahomes Pvt. Ltd. vs Union Of India And 5 Others
Petitioner was the promoter within the meaning of Section 2 (zk) of the Real Estate (Regulation and Development) Act, 2016. The petitioner entered into a builder-buyer agreement dated 10.07.2011 with the respondent nos. 5 and 6.
As per the agreement, the petitioner was under a contractual obligation to handover the flat within 30 months from the date of the agreement. A grace period of 180 days was also provided in the agreement. Thus as per the agreement, the petitioner was liable to handover the flat on or before 09.07.2014.
However, the petitioner could not complete and handover the flat to the respondent nos.5 and 6 within the agreed time and thus violated provisions of Section 18 of the Act, 2016. The actual possession of the flat was received by the respondent nos. 5 and 6 on 26.12.2017.
The Alotees filed an application before the Authority as defined in Section 2(i) of the Act, 2016 claiming compensation and interest for dealyed possession.
The authority passed an order dated 22.05.2019 holding that the Adjudicating Officer may be approached in this regard. Then the matter came before the Adjudicating Officer under Section 71 of the Act, 2016. The Adjudicating Officer passed an order dated 30.09.2019 awarding compensation and interest.
Feeling aggrieved, the Petitioner/Promoted filed a Writ Petition before the Allahabad High Court
Submissions of Petitioner/Promoter:
- Adjudicating Officer under Section 71 of the Act, 2016 has no power to award interest and compensation, in the event possession of the flat has been taken by the allottee from the promoter.
- Since the impugned order is without jurisdiction and, therefore, neither appeal shall lie under Section 43 (5) of the Act, 2016.
- In support of his submission, the petitioner relied upon the judgment of Allahabad High Court in Writ-C No. 9120 of 2020 (Habitech Infrastructure Limited Vs. State of U.P. and 2 others).
Discussion and Findings of Allahabad High Court
A Division Bench of Allahabad High Court comprising Hon’ble Surya Prakash Kesarwani,J. And Hon’ble Dr. Yogendra Kumar Srivastava,J., has decided the matter. The Court observed that contravention of the agreement is not disputed, as the possession has been handed over beyond the agreed time period.
Further, the Court observed that Section 71 of the Act, 2016 confers power upon an Adjudicating Officer to adjudge compensation under Sections 12, 14, 18 and 19. Sub-section (3) of Section 71 provides that if the Adjudicating Officer is satisfied that the person has failed to comply with the provisions of any of the sections specified in Sub-section (1) he may direct to pay such compensation or interest, as the case may be, as he thinks fit in accordance with the provisions of any of those sections.
Hence the Allahabad High Court held that the order is not without jurisdiction. Court found that the Judgment of Allahabad High Court in the case of Habitech Infrastructure Limited (Supra) is not applicable to the present case.
In the said Judgment the dispute was confined to refund of amount deposited by the allottee with the promoter and award of interest. Court observed that the Petitioner can approach the appellate authority.
Allahabad High Court dismissed the Writ Petition leaving it open for the petitioner to avail remedy of appeal under Section 43(5) of the Act, 2016.
Title: Vibhor Vaibhav Infrahomes Pvt. Ltd. vs Union Of India And 5 Others
Case No.- WRIT – C No. – 13904 of 2020
Coram- Hon’ble Surya Prakash Kesarwani,J. And Hon’ble Dr. Yogendra Kumar Srivastava,J.
Date of Judgment- 08.10.2020
Counsel for Petitioner :- Swapnil Rastogi
Counsel for Respondent :- A.S.G.I.,C.S.C.,Vinay Kumar, Pathak,Wasim Masood