MahaREAT – Project Without Completion Certificate Treated As Ongoing, Requires RERA Registration

Maharashtra Real Estate Appellate Tribunal (Tribunal), comprising Justice Shriram R. Jagtap (Judicial Member) and Dr. K. Shivaji (Member), held that any building which has not received a completion certificate from the competent authority as on the date of commencement of the Real Estate (Regulation and Development) Act, 2016 (“Act”), will be treated as an ongoing project and requires registration. Accordingly, the Tribunal directed Wadhwa Constructions to register Building No. 18 of their project which had only received a part occupancy certificate around 2008—well before the implementation of RERA. Background Facts Appellants (Buyer's Society) formed a society after purchasing units in project named Trade Centre, located in Bandra East, Mumbai. The builder was involved in constructing a building on land leased under a tripartite agreement between Mumbai Metropolitan Region Development Authority (MMRDA), Slum Rehabilitation Authority (SRA) and Housing Development and Infrastructure Limited (HDIL). The builder got the development rights as a sub-developer through an agreement with HDIL and later entered into sale agreements with multiple unit buyers. The building plan was approved for ground and 10 upper floors and partial occupation certificates were obtained in 2008. The builder gave an undertaking in October 2017 to secure the remaining occupation certificates. However, it failed to do so which led the society to file a complaint before Authority. They asked for a direction to hand over the full occupation certificate. The builder argued that the project was completed before the RERA mechanism came into effect in 2016 and therefore, it was not required to register the project. The Authority accepted the builder's defence and dismissed the complaint on 9 November 2020. Aggrieved by this, the society filed an appeal before the Tribunal seeking to set aside the Authority's order and direct the builder to fulfil its promises. Contentions of Builder Builder contended that it had completed construction of the building as per the sanctioned plan and had obtained part-occupation certificates for all floors except a small portion of the second floor. It further claimed that members of the society have been in possession of their respective units well before the RERA Act came into force. Builder argued that HDIL was responsible for obtaining the occupation certificate under the tripartite agreement. The builder stated that it had fulfilled its construction obligations and the delay in obtaining the occupation certificate for the second floor was due to HDIL's failure. Therefore, HDIL should have been made a party to the complaint and the appeal. Builder also contended that Section 3 of the RERA, 2016 does not apply in this case, as there is no ongoing construction or sale in the project and no registration is required under the Act in such circumstances. Observation and Direction by Tribunal The Tribunal observed that under Section 3 of the RERA, 2016 (Act), any building that has not received a completion certificate from the competent authority by the date of commencement of the Act must be treated as an ongoing project. In this case, the subject building had not yet received the completion certificate. Relying on the Supreme Court's judgment in M/s Newtech Promoters and Developers Pvt. Ltd. vs. State of UP & Ors [LL 2021 SC 641], the Tribunal held that the project clearly falls within the definition of an ongoing project. Therefore, the builder was mandatorily required to register the project with MahaRERA within three months from the commencement of the Act on 1st May 2017. Tribunal held that the Authority's order dated 9th November 2020 is legally unsustainable and found the builder liable for punishment under Section 59 of the Act for violating Sections 3 and 4 of the Act. Tribunal observed that, since the project remains unregistered it could not consider the appellant's prayer for a direction to secure the full-occupation certificate. Relying on Newtech Promoters (Supra) and Neelkamal Realtors Suburban Pvt. Ltd. & Anr. vs. Union of India & Ors. [(2017) SCC Online Bom 9302], it clarified that RERA provisions apply prospectively only after registration. Therefore, other reliefs can be considered only post-registration and the appellant is free to raise those issues at the appropriate time. Accordingly, the Tribunal modified the Authority's order, directed the builder to register the building under RERA and imposed a penalty of Rs.5 lakhs for non-compliance with the Act. Case – Trade Centre Premises Co-operative Housing Society Ltd. Versus Wadhwa Constructions Citation – APPEAL NO. U-4 OF 2021 in Complaint No: SC10002135 Date – 2nd April, 2025 Click Here To Read/Download The Order

MahaREAT – Project Without Completion Certificate Treated As Ongoing, Requires RERA Registration

Aryan Raj

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