Bombay HC Quashes State RERA Order Denying Compensation To Home Buyer Couple Aggrieved By Delayed Possession

RERA told to decide the matter afresh

Providing some relief to a home buyer couple already aggrieved by delayed possession, the Bombay High Court has set aside the order passed by the Maharashtra Real Estate Regulatory Authority (MahaRERA), by which it had denied compensation to them while holding that six-year delay on part of the builder was justifiable on grounds of administrative obstacles.

A bench of Justice RM Borde and Justice RG Ketkar has set aside the November 28, 2017, order passed by the MahaRERA holding it to be against the principles of natural justice since it did not record any reasons for the decision arrived at.

The bench was hearing a petition moved by Sharan Bihari Lund and his wife challenging the order of MahaRERA which denied them compensation for delay caused by the builder.

The couple had booked a flat in project named Imperial Heights in Goregaon (West). MahaRERA had held that the delay was caused by reasons beyond the control of the builder.

Before the high court, Lund’s counsel senior advocate Milind Sathe drew court’s attention to the order.

The bench noticed that the presiding officer at MahaRERA had merely recorded the submissions of the parties, and without elaborating reasons, proceeded to dispose of the complaint.

The bench referred to Section 38(2) of the Real Estate (Regulation and Development) Act, 2016, which provides that the authority shall be guided by the principles of natural justice.

“Since the deciding authority failed to record the reasons, according to us, the order impugned in this petition is not in conformity with the principles of natural justice. Recording of reasons discloses the mind of the deciding authority and the insight in respect of the circumstances or the other aspects which led the authority to arrive at a particular decision. The recording of reasons is obviously an aspect of the principles of natural justice and need to be adhered to. The order that ought to be passed by the authority shall be in compliance with the statutory requirements of Section 38(2) of the Act of 2016,” it said.

The bench directed the RERA to “reconsider the complaint and after extending an opportunity of being heard to both the parties, proceed to pass an order in conformity with the statutory provisions i.e. Section 38(2) of the Act of 2016”.

The court directed that the matter be decided afresh preferably within three months.

It is to be noted that Justice Ketkar was also part of the bench that had upheld the constitutional validity of RERA late last year.