Shwas Homes Private Limited v. Moon Waters Owners Association
2023-05-29
M.R.ANITHA
body2023
DigiLaw.ai
JUDGMENT : M.R. ANITHA, J. 1. The above MSAs were filed against the common judgment in REFA Nos. 17, 18, 27 and 30 of 2022 of the Kerala State Real Estate Appellate Tribunal, Ernakulam. 2. Heard both sides. 3. M.S.A. No. 1/2023 admitted on the following substantial questions of law: (a) Whether section 3 the Real Estate regulation and Development Act, 2016 contemplates registration when the completion of the project and issue of occupancy certificate under the relevant local law with reference to a period long before the Act? (b) Whether standalone project means and has to be reckoned along with the sanction plan, lay out, agreement of construction advertisement of the project? (c) Whether the certification of occupancy issued by the statutory authority can be brushed aside and ignored and required to be that complying with the Real Estate regulation and Development Act, 2016? (d) Whether registration of the project can be directed when sanction plan, layout plan etc has expired and no declaration as contemplated under Section 4(2)(i) could be obtained for want no new constructions being commenced or advertised and when already substantial units have been sold out years back? (e) Whether an inquiry under section 35 is mandatory before considering and adjudicating the question as to whether a project is ongoing or not for the purpose of registration? (f) Whether interim order survives and is binding for other proceedings before the same forum in the same subject matter, when final order is pronounced? (g) Is the finding that the whole Acquacity township project is registrable under section 3 the Real Estate regulation and Development Act, 2016 is correct? 4. M.S.A. Nos. 4 and 6 of 2023 admitted on the following substantial questions of law: 1. Whether order dated 28.04.2021 preclude K-RERA from reconsidering the question of registration of the project in the final stage? 2. Whether there is any illegality in initiating suo moto proceedings by K-RERA regarding the registration of the project, after the proceedings initiated against the appellant/promoter in the complaints and passing of order dated 28.04.2021? 5. When the appeals came up for hearing, the learned counsel for the appellants would submit that MSA Nos. 4 and 6 of 2023 arouse out of the suo moto proceedings initiated by the Kerala Real Estate Regulatory Authority (in short ‘K-RERA’). While disposing the common judgment in REFA Nos.
5. When the appeals came up for hearing, the learned counsel for the appellants would submit that MSA Nos. 4 and 6 of 2023 arouse out of the suo moto proceedings initiated by the Kerala Real Estate Regulatory Authority (in short ‘K-RERA’). While disposing the common judgment in REFA Nos. 17, 18, 27 & 30 of 2022 of the Kerala Real Estate Appellate Tribunal (in short ‘the Tribunal’) found that KRERA has no power to review its earlier order dated 28.04.2021 and hence, the suo moto order dated 21.12.2021 is without authority and is non-est in the eye of law and it has no legal effect or consequence. Hence, no argument was advanced in MSA Nos. 4 and 6 of 2023 which in turn arouse out of the order in REFA Nos. 17/2022 and 18/2022. 6. In REFA No. 27/2022 appellants are the promoters and the respondents 1 and 2 are the associations in a tower by name Moon Waters Association and Aqua City Palm Bay Villas Owners Residence Association and respondent Nos. 3 and 4 are two allotees in Moon Waters in the township called Aqua City. Three complaints 115, 116, 117 of 2020 were filed seeking registration of Aqua City township project comprising ten apartment towers and 68 Villas and other reliefs before K-RERA. K-RERA passed two interim orders issuing show cause notices to the promoters for not registering the projects on 07.11.2020 and 30.11.2020 respectively. Against which W.P. (C) No. 27217/2020 was filed and this Court directed K-RERA to consider the question of maintainability of complaints and competency of complainants on hearing both sides. Thereafter, an interim order was passed on 28.04.2021 to the effect that the entire project is registrable under Section 3 of the Real Estate (Regulation and development) Act, 2016 (in short ‘the Act’). The question of maintainability was found in favour of the respondents. Against which the appellants filed REFA Nos. 29, 30 and 31 of 2021 before the Tribunal, but those appeals were withdrawn with liberty to file fresh appeal against the final order. During the pendency of the complaints 115, 116 and 117 of 2020 before K-RERA, suo moto proceedings were initiated with regard to non registration of the project under Section 3 of the Act. 7. After hearing both sides, on 21.12.2021 K-RERA in the suo moto proceedings found that ‘Aqua City’ project excluding Palm Bay Villa Project is registrable.
During the pendency of the complaints 115, 116 and 117 of 2020 before K-RERA, suo moto proceedings were initiated with regard to non registration of the project under Section 3 of the Act. 7. After hearing both sides, on 21.12.2021 K-RERA in the suo moto proceedings found that ‘Aqua City’ project excluding Palm Bay Villa Project is registrable. Against which REFA Nos. 17 and 18 of 2022 was filed by the appellants/promoter and REFA No. 30/2022 was filed by the 2nd respondent challenging the exclusion of villas from registration. 8. According to the learned counsel for the appellants/promoter, the Tribunal found that the suo moto proceedings initiated by K-RERA is non-est, since, it has no power to review its earlier interim well considered order dated 28.04.2021, wherein it is found that the entire project is registrable. Hence, it is found the order dated 21.12.2021 in the suo moto proceedings is non-est. Hence, the Tribunal only considered the REFA Nos. 27/2022. According to the learned counsel as per the order dated 23.12.2021 the K-RERA has not gone into question of registration, since that has been dealt with in the suo moto proceedings and that order has been passed on 21.12.2021. In the order dated 23.12.2021 the K-RERA only gave some directions under Section 34(f) and 37 of the Act which is with respect to some amenities and facilities to be provided by the appellants. Hence, the contention of the learned counsel is that when the Tribunal set aside the order dated 21.12.2021 by which K-RERA ordered registration of the project excluding the villa, order dated 23.12.2021 only deals with the directions with regard to the amenities and facilities to be provided by the appellant. Hence, according to the learned counsel, after setting aside the suo moto proceedings and declaring the order dated 21.12.2021 as non-est, findings made in Para No. 14(iv)(e) is perverse, since there is no order to register any of the project in the final order dated 23.12.2021. 9.
Hence, according to the learned counsel, after setting aside the suo moto proceedings and declaring the order dated 21.12.2021 as non-est, findings made in Para No. 14(iv)(e) is perverse, since there is no order to register any of the project in the final order dated 23.12.2021. 9. The Tribunal also found that in view of the directions by this Court that K-RERA passed a well considered order on 28.04.2021 with regard to the registrability of the entire Aqua City projects and that order merged with the final order dated 23.12.2021 and hence the suo moto order directing registration of the project excluding Palm Bay Villa Project on 21.12.2021 is non-est and without jurisdiction since the K-RERA has no power to review its order. 10. The learned counsel for the appellants would vehemently contend that the order dated 28.04.2021 is only a preliminary order regarding the maintainability of the complaints filed by the respondents before K-RERA and the final order of the same has been passed by K-RERA as per the order dated 21.12.2021. 11. In this context, the learned counsel for the respondents would contend that the order dated 28.04.2021 is a well considered order passed after hearing both sides in the matter of registration of whole ‘Aqua City’ Project and that order has become final and the subsequent order in the suo moto proceedings dated 21.12.2021 is hit by the principles of res judicata. 12. Before going through the rival contentions it would be necessary to state a brief history of the complaint Nos. 115/2020 and 116/2020 filed by the Moon Waters Owners Association and Aqua City Palm Bay Villa Owners/Residence Association respectively. Complaint No. 117/2020 has been filed by two allotees of Moon Waters Apartments against the appellants herein. 13. According to the learned counsel for the respondents, the appellants/promoters had done wide marketing activities in news papers and medias in India as well as foreign countries releasing brochures about ‘Aqua City’ Township Project and its various amenities. Many of the NRIs on getting attracted by the fabulous brochures and advertisements entered into the sale and construction agreements with the respondents and gave full amounts. Huge amounts were collected by the respondents for two level car parking facility, but the apartments were handed over without providing offered facilities and amenities without obtaining final fire NOC, sanitation facility, sewage treatment plant etc.
Huge amounts were collected by the respondents for two level car parking facility, but the apartments were handed over without providing offered facilities and amenities without obtaining final fire NOC, sanitation facility, sewage treatment plant etc. So, according to the respondents their life in the apartments turned miserable and ultimately they approached K-RERA seeking various reliefs including registration of the project under the Act, for providing mandatory requirements etc. 14. The appellants/respondents filed objection disputing the maintainability of the petition and the locus-standi of the complainants. The Moon Water Apartment Complex constructed in 23.10 Acres and the construction was completed in December, 2012 and the apartments were numbered in the year 2013 and the apartments were handed over to the respective owners in the year 2013 and they were occupying the same from the year 2013 onwards. A completion certificate was also issued by the Panchayath long before the commencement of the Act. It is contended that after the formation of Adhoc Association of Apartment Owners the monthly maintenance charges of Rs. 1,500/- each is not being paid by all the owners. It is also contended that an amount of Rs. 51,03,401/- is due to them towards monthly charges. 15. The respondents also contended about the various facilities and amenities which has been provided already. It is also contended that fire fighting system, STP system etc. are already completed and statutory formalities alone remains to be completed. 16. Based on the above following points were raised for consideration: 1. Whether order dated 28.04.2021 will operate as res judicata in considering the question of registration in the final stage? 2. Whether there is any illegality in initiating suo moto proceedings by K-RERA after the proceedings initiated against the appellants/promoter in the complaints and passing of order dated 28.04.2021? 3. Whether the order passed by the Tribunal in REFA No. 27/2022 is liable to be set aside? Point No. 1 17. According to the learned counsel for the respondents, as per the directions of this Court in W.P. (C) No. 27217/2020 the K-RERA passed detailed order dated 28.04.2021 finding that the entire ‘Aqua City’ Project is liable to be registered under the Act. Hence, K-RERA is estopped from considering the question of registration again since the earlier order dated 28.04.2021 will operate as res judicata. 18.
Hence, K-RERA is estopped from considering the question of registration again since the earlier order dated 28.04.2021 will operate as res judicata. 18. The learned counsel in this context bring to my attention State of Kerala vs. Mathai, 2017 (3) KLT 462 and S. Ramachandra Rao vs. S.Nagabhushana Rao and Others, 2022 Live Law SC 861. 19. In Mathai’s case, Division Bench of this Court made a detail discussion with respect to classification of interlocutory orders and the binding nature of the orders passed by a court in subsequent proceedings of the same court. While discussing the issue the Division Bench quote Arjun Singh vs. Mohindra Kumar, AIR 1964 SC 993 wherein an elaborate discussion as to how interlocutory orders attain finality and how the principle of res judicata applies to them has been discussed in detail. In paragraph Nos. 24 to 26 the decision in Arjun Singh has been quoted, which reads thus: “24. In Arjun Singh vs. Mohindra Kumar, AIR 1964 SC 993 , Supreme Court elaborately discussed how interlocutory orders attain finality and, consequently, how the principle of res judicata applies to them. Arjun Singh classifies the interlocutory orders into three types: (a) orders like staying proceedings, injuncting parties, appointing receivers; (b) orders like restoring proceedings, as under Order 9, Rule 7 of C.P.C. (c) orders like those that cannot be reopened or reconsidered unless fresh facts emerge. 25. Type (a) orders preserve the status quo pending the litigation and ensure that the parties are not prejudiced by the procedural delays. They do not, in that sense, decide the merits of the controversy in issue. On the other hand, the dismissal of petitions resulting in type (b) orders does not preclude the aggrieved person to challenge them in the appeal taken against the final decree and judgment. In that sense, the trial court’s refusal “to permit the defendant to ‘set the clock back’ does not attain finality. Indeed, S.105 of C.P.C. statutorily acknowledges this position. 26. Type (c) orders concern those that bind the ‘same’ court at later stages, precluding it from reconsidering the decision.
In that sense, the trial court’s refusal “to permit the defendant to ‘set the clock back’ does not attain finality. Indeed, S.105 of C.P.C. statutorily acknowledges this position. 26. Type (c) orders concern those that bind the ‘same’ court at later stages, precluding it from reconsidering the decision. Arjun Singh observes that “even if the rule of res judicata does not apply, it would not follow that on every subsequent day which the suit stands adjourned for further hearing, the petition could be repeated and fresh orders sought on the basis of identical facts.” Arjun Singh says illustratively that “If an application for the adjournment of a suit is rejected, a subsequent application for the same purpose, even if based on the same facts, is not barred on the application of any rule of res judicata, but would be rejected for the same grounds on which the original application was refused.” 20. So, on going through the above what could be gathered is, there the interlocutory orders are classified into three types: (1) Orders like staying proceedings, injuncting parties, appointing receivers. (2) Orders like restoring proceedings as under Order 9 Rule 7 of Code of Civil Procedure and (3) Orders like those that cannot be reopened or reconsidered unless fresh facts emerge. It is the 3rd type orders that is held to bind the same court at later stages precluding it from reconsidering the decision. It is held that even if the rule of res-judicata does not apply it would not follow that on every subsequent day which the suit stands adjourned for further hearing, the petition could be repeated and fresh orders sought on the basis of identical facts. But, at the same time, it would indicate that when fresh facts emerge, it will not preclude the court from reopening the earlier interlocutory order. 21. In Para No. 31 of the said decision Satyadhyan Ghosal vs. Deorajin Debi, AIR 1960 SC 941 has been quoted wherein the law laid down is that principle of res judicata also applies between two stages in the same proceedings, if a party to proceedings wants to reagitate the matter at a later stage despite trial court or higher court decided the matter in one way at an earlier stage.
It is also held that the findings at the interlocutory stage would not affect the interlocutory orders such as orders granting the temporary injunction, appointing receiver and so forth, which do not purport to decide the rights of the parties finally. 22. In C.V. Rajendran vs. N.M. Muhammed Kunhi, AIR 2003 SC 649 , principles laid down is that res judicata applies between two stages in the same litigation, i.e. if an issue has been decided at an earlier stage against a party it cannot be allowed to be re-agitated at a subsequent stage in the same suit or proceedings. In that case, the earlier proceedings for eviction between the parties, decided against the landlord finding that the requirement of bona fides is not proved. Thereafter, the landlord again initiated the eviction proceedings on the ground of bona fide requirement. The Rent Control Court declined the relief on the ground of bar under Section 15 of the Act, that the eviction petition is not maintainable and appellate authority allowed the appeal finding that the petition is maintainable and remanded the case to the Rent Control Court for fresh disposal on merits which order became final and as it was confirmed in RCRP before the District Judge. After the remand the Rent Control Court found that need of the landlord is bona-fide and eviction was ordered and that was confirmed by the appellate authority and the revision was filed before the High Court and the High Court held that the earlier order of the appellate authority holding that Section 15 of the Act will not bar the eviction proceedings against the appellant had become final and cannot be reagitated afresh and Section 15 will not bar the subsequent eviction petition and the Civil Revision petition was dismissed. Against which the tenant approached the Apex Court by special leave and contention was raised to the effect that order passed by the appellate Authority that the eviction petition is maintainable and Section 15 of the Act does not operate as res-judicata is not sustainable.
Against which the tenant approached the Apex Court by special leave and contention was raised to the effect that order passed by the appellate Authority that the eviction petition is maintainable and Section 15 of the Act does not operate as res-judicata is not sustainable. While deciding the issue the Apex Court held that as the question whether Section 15 of the Act bar the present eviction petition was decided against the tenant by the appellate Authority at the earlier stage of the suit and it has become final and it is not open to the tenants to re-agitate the same at a subsequent stage of the suit. But that was a case in which the maintainability of the subsequent eviction proceedings by the landlord against the tenant on the ground of bona-fide need was held to be maintainable by the 1st appellate Authority and though it was challenged in revision it was also dismissed confirming the order of the 1st appellate Authority and the case was thereafter tried by the Rent Control Court and eviction was ordered. So the question of maintainability has attained finality. In that context it was held that the principle of res-judicata applies between two stages of the same litigation and if an issue has been decided at an earlier stage, it cannot be allowed to be re-agitated at a subsequent stage in the same suit. 23. The facts of Ramachandra Rao’s case, would go to show that the plaintiff’s wife who is his general power of attorney holder was permitted to appear on behalf of the plaintiff by an earlier order of the court. But, subsequently she enrolled as an advocate and the question arouse as to whether Section 32 of Advocates Act, 1961 would prevent her from acting as power of attorney for the plaintiff for the reason that subsequently she got enrolled as an advocate. Section 32 of the Advocates Act provides that any court, authority or person may permit any person not enrolled as an advocate under the Act to appear before it or him in any particular case.
Section 32 of the Advocates Act provides that any court, authority or person may permit any person not enrolled as an advocate under the Act to appear before it or him in any particular case. In that context, it was held by the Apex Court that the contention that Section 32 creates a bar for the wife of the plaintiff to seek permission of the court to appear on behalf of her husband in her capacity as general power of attorney holder because she has enrolled as an advocate is not acceptable. It was held that there does not have any statutory prohibition operating in the situation like that of the present case, for which existing general power of attorney holder of a party cannot be given permission to appear only as general power of attorney holder even if, he or she has been enrolled as an advocate. So the facts situation of the case has no application to the case on hand. 24. In the present case, the interim order passed by the K-RERA is in pursuance of the direction of this Court in W.P. (C) No. 27217/2020 wherein this Court while disposing the writ petition directed the K-RERA to consider the question of maintainability of the complaints and locus-standi of the complainants as preliminary issue within a period of one month from the next posting date. It is also directed that the parties shall appear before the Authority on 29.03.2021 and the Authority may finally dispose of the complaints after deciding the preliminary issues expeditiously. Accordingly, K-RERA as per order dated 28.04.2021 found that the township projects Aqua City “is registrable under Section 3 of the Act and the act of the respondents doing marketing activities without K-RERA registration is punishable under Section 59 of the Act and as the respondents have clearly violated the provisions of the Act”, the above three complaints are maintainable before the Authority. So it is purely an order passed by K-RERA in view of the directions of this Court to consider the question of maintainability of the complaints and the locus standi of the complainants as a preliminary issue, though K-RERA also found that the project ‘Aqua City’ is registrable under Section 3 of the Act.
So it is purely an order passed by K-RERA in view of the directions of this Court to consider the question of maintainability of the complaints and the locus standi of the complainants as a preliminary issue, though K-RERA also found that the project ‘Aqua City’ is registrable under Section 3 of the Act. It is also notable that this Court while disposing the writ petition also directed the K-RERA to finally dispose of the complaints after deciding the preliminary issues expeditiously. So, it goes without saying that there was a direction to consider or dispose the issue of maintainability of the complaints as a preliminary issue and thereafter to dispose the complaints finally. The findings of the Tribunal is that since considered order has been passed by the K-RERA on the question of maintainability and the registration it cannot issue any suo moto show cause regarding the registration again. The legality of K-RERA initiating suo moto proceedings regarding registration would be dealt with while considering the next issue. Here the question is whether the interim order passed on 28.04.2021 by K-RERA on the question of maintainability will preclude it from considering the question of registration again or that would operate as res judicata. While discussing Arjun Singh’s case, it has already been found that there are three types of interlocutory orders and the 3rd category is one which preclude a court from reopening or reconsidering an issue which is decided earlier unless fresh facts emerge. Here, order passed in the suo moto proceedings on 21.12.2021 would state that appellants/promoter brought in new materials and evidence and challenged the finding and hence the question is considered again. It is also to be noted in this context that admittedly challenging the order dated 28.04.2021 the appellant filed appeal before the Tribunal REFA Nos. 17, 18, 27 and 30 of 2022 which was subsequently withdrawn with liberty to raise the claim after passing the final orders. This is a case in which the appellants/promoter actually challenged the order dated 28.04.2021 and those appeals were withdrawn with liberty to challenge the final order. So also with regard to the registration K-RERA initiated suo moto proceedings. In the suo moto proceedings K-RERA specifically discussed the registrability of the project. Appellants also produced the documents and advanced arguments.
This is a case in which the appellants/promoter actually challenged the order dated 28.04.2021 and those appeals were withdrawn with liberty to challenge the final order. So also with regard to the registration K-RERA initiated suo moto proceedings. In the suo moto proceedings K-RERA specifically discussed the registrability of the project. Appellants also produced the documents and advanced arguments. Thereafter the order dated 21.12.2021 was passed modifying the interim order to the effect that the appellants/promoter to register the project Aqua City as an ongoing project excluding the building construction of Palm Bay Villas. So, the Palm Bay Villa Project was excluded from registrations in view of the order dated 21.12.2021. As stated earlier order dated 21.12.2021 itself would go to show that the appellants/promoter brought in more materials, evidence and advanced arguments. In view of the same the order dated 21.12.2021 was passed modifying the earlier order dated 28.04.2021 with regard to the registration of the project. So, even if the principles laid down in Mathai’s case or Arjun Singh’s case is followed the fact situation of this case will come under the category No. 3 of the interlocutory orders described therein and when fresh facts emerge the court is not precluded from reconsidering or reopening the issue earlier found. So the order dated 21.12.2021 passed with regard to the registration of the project excluding Palm Bay Villas cannot be said as hit by res judicata. I also want to make it clear that I have not gone into the merits of the matter. 25. Next aspect is that the complaints filed by the respondents itself are under Section 31 of the Act seeking the appellants to register the project Aqua City Township under Section 3 of the Act by including amenities offered in the brochures, advertisements etc. So the main relief in the complaint itself is seeking for registration of the Aqua City Township Projects. So when this Court in W.P. (C) No. 27217/2020 directed the K-RERA to determine the maintainability of the complaint as a preliminary issue and when there is a finding in that order to the effect that the entire project is liable to be registered and it can only be treated as a prima facie finding for determining the question of maintainability of the complaints. If that question is determined finally nothing further remains for determination in the final proceedings.
If that question is determined finally nothing further remains for determination in the final proceedings. So in that regard also the order dated 28.04.2021 can only be taken as an order with regard to the maintainability of the complaints before the K-RERA and it will not preclude it from considering the question of registration in the final proceedings. Point so found in favour of the appellant. Point No. 2 26. The findings of the Tribunal is to the effect that when a considered order has been passed by K-RERA on 28.04.2021 on the question of maintainability and registration, K-RERA cannot issue suo moto show cause regarding the registration again and the procedure so adopted is illegal. It is also found that K-RERA has no power to review its own order dated 28.04.2021 by excluding Palm Bay Villa Project from the purview of registration. It is also found that K-RERA cannot take suo moto proceedings when the matter of registration is brought to its notice by complaints. 27. Hence, the question is whether there is any illegality in K-RERA initiating suo moto proceedings when complaints are filed by the respondents and that are pending consideration of K-RERA. In this context, it is relevant to look at the provisions of the Act. 28. Section 34 of the Act deals with the functions of the authority. It is apposite in this context to quote Section 34 which reads thus: Functions of Authority - The functions of the Authority shall include: (a) to register and regulate real estate projects and real estate agents registered under this Act. (b) to publish and maintain a website of records, for public viewing, of all real estate projects for which registration has been given, with such details as may be prescribed, including information provided in the application for which registration has been granted. (c) to maintain a database, on its website, for public viewing, and enter the names and photographs of promoters as defaulters including the project details, registration for which has been revoked or have been penalised under this Act, with reasons therefor, for access to the general public. (d) to maintain a database, on its website, for public viewing, and enter the names and photographs of real estate agents who have applied and registered under this Act, with such details as may be prescribed, including those whose registration has been rejected or revoked.
(d) to maintain a database, on its website, for public viewing, and enter the names and photographs of real estate agents who have applied and registered under this Act, with such details as may be prescribed, including those whose registration has been rejected or revoked. (e) to fix through regulations for each areas under its jurisdiction the standard fees to be levied on the allottees or the promoter or the real estate agent, as the case may be. (f) to ensure compliance of the obligations cast upon the promoters, the allottees and the real estate agents under this Act and the rules and regulations made there under. (g) to ensure compliance of its regulations or orders or directions made in exercise of its powers under this Act. (h) to perform such other functions as may be entrusted to the Authority by the appropriate Government as may be necessary to carry out the provisions of this Act. 29. Section 35 deals with the powers of authority to call for information and conduct investigation which reads thus: “Powers of authority to call for information, conduct investigation: (1) Where the Authority considers it expedient to do so, on a complaint or suo motu, relating to this Act or the rules of regulations made there under, it may, by order in writing and recording reasons therefor call upon any promoter or allottee or real estate agent, as the case may be, at any time to furnish in writing such information or explanation relating to its affairs as the Authority may require and appoint one or more persons to make an inquiry in relation to the affairs of any promoter or allottee or the real estate agent, as the case may be. (2) Notwithstanding anything contained in any other law for the time being in force, while exercising the powers under sub-section (1), the Authority shall have the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 while trying a suit, in respect of the following matters, namely: (i) the discovery and production of books of account and other documents, at such place and at such time as may be specified by the Authority. (ii) summoning and enforcing the attendance of persons and examining them on oath. (iii) issuing commissions for the examination of witnesses or documents. (iv) any other matter which may be prescribed.” 30.
(ii) summoning and enforcing the attendance of persons and examining them on oath. (iii) issuing commissions for the examination of witnesses or documents. (iv) any other matter which may be prescribed.” 30. Section 36 deals with the power to issue interim orders and Section 37 deals with the powers of Authority to issue directions and Section 38 deals with the powers to impose penalty or interest in regard to any contravention of obligations cast upon the promoters, allottees, real estate agents etc. 31. On going through Section 35 of the Act it is very clear that where the Authority considers it expedient to enquire about the affairs of any promoter, allottee, real estate agent etc., either upon a complaint or suo moto, in relation to this Act or Rules of Regulations, it has power to call upon the promoter or allottees or real estate agent at any time to furnish in writing such information or explanation relating to its affairs and also can make enquiry by appointing one or more persons relating to affairs of any promoter or allottees or real estate agent. Sub-Section 2 of Section 35 also provides that while exercising the powers under Sub-Section (1) the Authority has the same powers as are vested in Civil Courts under the Code of Civil Procedure, 1908, while trying a suit with regard to discovery and production of books of account and other documents or summoning or enforcing the attendance of persons and examining them on oath and issuing commission for the examination of the witnesses and documents and it has also powers, to pass interim orders and also has powers to issue directions. The above powers can be exercised by K-RERA either upon a complaint or suo moto. So, it cannot be said that K-RERA has no jurisdiction to exercise the powers vested with under Section 35 to 38 after receiving a complaint by any aggrieved person. In other words, the powers of K-RERA vested under Section 35 to 38 are very vast and the fact that a complaint has been filed by the allottees or real estate agent or promoter will not inhibit the K-RERA to initiate action as contemplated therein by suo moto also. So also the records would go to show that show cause notice has been issued on 19.11.2020 prior to the passing of the order dated 28.04.2021. 32.
So also the records would go to show that show cause notice has been issued on 19.11.2020 prior to the passing of the order dated 28.04.2021. 32. So the findings of the Tribunal that since a complaint has already been filed and the matter of registration is brought to its notice, K-RERA cannot take suo moto proceedings is not in consonance with the provisions of the Act and is not sustainable in law. Point so found in favour of the appellants. Point No. 3 33. According to the learned counsel for the appellants/promoter, the impugned order passed by the Tribunal itself is not sustainable since after finding that suo moto order dated 21.12.2021 is without any authority and non-est in the eye of law, it is further found that the final order dated 23.12.2021 is unsustainable in the matter of exclusion of Palm Bay villa project from the purview of registration. As rightly contended by the learned counsel for the appellants, in the final order dated 23.12.2021 KRERA has not considered the question of registration of the project. On the other hand, final order with regard to the registration of the project is passed by K-RERA as per the order dated 21.12.2021. When that order is found to be illegal and non-est in the eye of law, there is no order subsisting with respect to registration of the projects. Moreover, the final order dated 23.12.2021 of K-RERA only gives directions to the promoter under Section 34(f) and 37 of the Act. It has been expressly stated in the order dated 23.12.2021 of K-RERA in para number 19 towards the end that the direction for registration of the project is given in separate order in suo moto proceedings. So, the impugned order of the Tribunal with reference to the registration of the whole ‘Aqua City’ Township project is perverse. 34. The specific contention of the learned counsel for the appellants is that the project of the appellant is to develop the different apartments in phases and as per explanation to sub Section 2 of Section 3, the project ought to have been considered as a stand alone real estate project.
34. The specific contention of the learned counsel for the appellants is that the project of the appellant is to develop the different apartments in phases and as per explanation to sub Section 2 of Section 3, the project ought to have been considered as a stand alone real estate project. He would also contend that as per Section 4(2)(c) of the Act, the promoter in order to make an application to the authority for registration of the real estate project has to produce an authenticated copy of the approvals and commencement certificate from the competent authority obtained in accordance with laws as may be applicable for the real estate project mentioned in the application where the project is proposed to be developed in phases and authenticated copy of the approvals and commencement certificates from the competent authority for each of such phases. Appellants are not in a position to produce either copy of the approvals and the commencement certificates as contemplated in sub Clause (c) of Sub-Section (2) of Section 4 since part of the project has already been completed. According to him, the project originally was in 17.10 Acres consisting of 10 towers and 68 villas and the building permit was obtained on 18.12.2007 with respect to 2,20,362.64 sq.meters of F.A.R and the common facilities is in 2 Acres. Subsequently, permit was extended for three years with respect to the same area i.e. 2,20,362.64 sq. meters of F.A.R. on 26.11.2010. On 15.02.2014 the permit was renewed with respect to 1,70,832 sq. meters of F.A.R, in that, three towers i.e. Moon Water and two other towers were excluded. Thereafter, on 25.07.2017, the last permit was obtained for two years with respect to 1,54,902.90 sq. meters of F.A.R. upto 17.12.2019. 35. The main contention of the learned counsel is that since there is no permit with respect to the towers including that of Moon Water, the appellants are not in a position to comply Section 4(2)(c). He would also contend that there is a clause in agreement which says that first party is intending to construct several blocks of building in a phased manner i.e. block by block and if the second party has taken possession of the apartment before the completion of other blocks he shall not obstruct other construction activities until the entire project is over.
That also, according to the learned counsel for the appellants, would indicate that the permit was obtained to construct the building in a phased manner and when the subsequent renewal of permit also shows exclusion of areas which are already completed, the already constructed area cannot be included in the projects as an ongoing project and hence explanation to sub section 2 of Section 3 cannot be made applicable in the case of towers with respect to which occupancy certificate has already been issued and the panchayat also excluded those built up area from the permit while renewing the permit. It is his contention that though the said argument was advanced at length before the Tribunal that aspect has not been considered by the Tribunal. 36. The learned counsel for the 1st respondent, on the other hand, would contend that it has been categorically found by K-RERA as well as the Tribunal that with respect to the 1st respondent, the fire NOC and the PCB clearance has not been obtained and no occupancy certificate as contemplated under the Kerala Panchayat Building Rules also could be produced by the appellants to prove that occupancy certificate has been issued with respect to Moon Water. It is also his contention that the occupancy certificate or completion certificate as contemplated under the Act has not been issued with respect to the Moon Water and hence as per the dictum laid down in New Tech Promotors and Developers (P) Ltd. vs. State of U.P. 2021 (6) KLT Online 1001 SC it has to be taken as an ongoing project. The order in C.M.S.A. No. 27/2020 dated 16.02.2021 of the Madras High Court M/s. SARE Shelters Project Pvt. Ltd. vs. SARE SQUIRES and Another; Order dated 03.02.2020 in C.M.A. No. 2287/2019 and C.M.P. No. 1042/2019, M/s. Adinath Srinivasa Foundations LLP vs. The Secretary, Serene Kshetra Owners Association, were also relied on by the learned counsel to content that Moon Water is also an ongoing project. 37. In previous paragraphs while deciding point Nos. 1 and 2 it has already been found that as the Tribunal set aside the order dated 21.12.2021 as non-est, there is no subsisting order with regard to the registration of the project.
37. In previous paragraphs while deciding point Nos. 1 and 2 it has already been found that as the Tribunal set aside the order dated 21.12.2021 as non-est, there is no subsisting order with regard to the registration of the project. So, the impugned order passed by the Tribunal is without considering the final order of the K-RERA in the suo moto proceedings dated 21.12.2021 with regard to registration of the project and hence it is unsustainable and is liable to be set aside. Since, no order on merit has been passed by the Tribunal based on the order dated 21.12.2021, this Court is not venturing to pass any order on merit with regard to the registration of the project ‘Aqua City’ in this proceedings. 38. Though the learned counsel for the appellants would submit that M.S.A. No. 4/2023 and M.S.A. No. 6/2023 can be closed, in view of the findings made above the order passed by the Tribunal setting aside the order dated 21.12.2021 in suo moto proceedings is already found to be illegal and unsustainable and hence is hereby set aside. Hence, the above M.S.A. challenging that order is only to be allowed. 39. In the result, M.S.A. Nos. 01 of 2023, 4 of 2023 and 6 of 2023 are allowed as follows: (i) The order passed by the Tribunal setting aside the order of K-RERA No. 321/K-RERA/2020 dated 21.12.2021 is hereby set aside and the Tribunal is directed to dispose REFA Nos. 17, 18 and 30 of 2022 afresh after hearing both sides. (ii) The impugned order passed by the tribunal in REFA No. 27/2022 is also set aside and the Tribunal is directed to dispose the matter afresh in view of the disposal of REFA Nos. 17, 18 and 30 of 2022. 40. In the facts and circumstances, parties shall bear their respective costs.