MahaREAT Refuses To Adjudicate Homebuyer's Appeal Due To Ongoing Injunction Issued By Pune Civil Court

Background Facts

The Builder undertook the development of land in Kalyaninagar, Yerwada, Pune between 2000 and 2006. This development project, named "Leena Garden," comprised three wings: A, B, and C, and included a total of 79 flats. By 2005-2006, Wings B and C had received Occupation Certificates, while Wing A had only obtained a partial Occupation Certificate during 2004-2006.

The Builder handed over possession of the flats to the 79 home buyers and unilaterally executed a registered Deed of Declaration on 06.11.2006. At the time the Real Estate (Regulation and Development) Act, 2016 came into effect, Wing A remained incomplete. Subsequently, the Builder submitted a revised plan to the concerned authority and obtained approval on 17.11.2017 without the consent of the 79 home buyers.

Given that the project was still ongoing when the RERA Act, 2016 commenced, the Builder was required to apply for registration of the project under Section 3 of the Act. The Builder's failure to do so constituted a violation of Section 3 of the RERA Act, 2016.

The Homebuyers, therefore, filed a complaint seeking an order directing the Builder to register the project with MahaRERA and imposing a heavy penalty for non-compliance with the mandatory provisions of the RERA, 2016. In its order dated 29.04.2022, MahaRERA holds the Builder not liable under Section 59 of the RERA,2016. Aggrieved by this decision, the Homebuyers filed an appeal before the Tribunal.

Builder's Contention

The builder contended that though they have obtained commencement certificates, the builder has never advertised, marketed, offered for sale, or invited persons to purchase the flats, and therefore, the project is not required to be registered with MahaRERA.

The builder further contended that the Leela Garden Co-operative Society Ltd. has filed a Regular Civil Suit against the builder seeking a declaration and injunction, which is currently pending before the Civil Court in Pune and the court has issued an injunction order preventing the builder from undertaking any additional construction on the existing building. As this injunction order remains in effect, the builder argued that the question of project registration does not arise.

REAT Verdict

Tribunal noted that the injunction order issued by the Pune Civil Court prevents the builder from doing any construction on the existing building. Consequently, Tribunal found that it would be premature to decide on the project's registration under Section 3 of RERA. Therefore, the Tribunal granted the Homebuyers the liberty to file a fresh complaint if construction on Wing A began after the injunction was lifted, set aside, or modified.

Tribunal concluded that the homebuyer's appeal could not be adjudicated at this stage, considering that the Pune Civil Court has already issued an injunction. Therefore, the Tribunal disposed of the homebuyer's appeal. Furthermore, the Tribunal allowed the Homebuyers to approach the appropriate forum, including MahaRERA, for grievances if the builder commenced construction after the injunction was vacated, set aside, or modified.

Case – Kunal Kashyap & another Versus M/S Atul Enterprises

Citation - Appeal No. U6 of 2O22

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