Case Laws-RERA-Supreme Court

Can a Real Estate Company purchased a flat for the purpose of residence of its Directors and Directors’ family be treated as a Consumer under the Consumer Protection Act, 2019? – Omkar Realtors and Developers Pvt. Ltd. Vs. Kushalraj Land Developers Pvt. Ltd. and Anr. – Supreme Court

Hon’ble Supreme Court held that the mere fact that the respondent-company is a real estate company, it does not mean that the flat was purchased by it for commercial purpose or for resale so as to earn profits. It is the appellant who is contending that the respondent is not a consumer and as such the complaint is not maintainable, therefore, the burden lies heavily upon it to lead evidence to prove that the respondent in purchasing the flat in question is indulging in real estate business.

Can a Real Estate Company purchased a flat for the purpose of residence of its Directors and Directors’ family be treated as a Consumer under the Consumer Protection Act, 2019? – Omkar Realtors and Developers Pvt. Ltd. Vs. Kushalraj Land Developers Pvt. Ltd. and Anr. – Supreme Court Read Post »

The provisions of the Limitation Act have to be construed differently, such as Section 3 has to be construed in a strict sense whereas Section 5 has to be construed liberally – Pathapati Subba Reddy (Died) By L.Rs. and Ors. Vs. The Special Deputy Collector (LA) – Supreme Court

Hon’ble Supreme Court held that:
(i) Law of limitation is based upon public policy that there should be an end to litigation by forfeiting the right to remedy rather than the right itself;
(ii) A right or the remedy that has not been exercised or availed of for a long time must come to an end or cease to exist after a fixed period of time;
(iii) The provisions of the Limitation Act have to be construed differently, such as Section 3 has to be construed in a strict sense whereas Section 5 has to be construed liberally;
(iv) In order to advance substantial justice, though liberal approach, justice-oriented approach or cause of substantial justice may be kept in mind but the same cannot be used to defeat the substantial law of limitation contained in Section 3 of the Limitation Act;
(v) Courts are empowered to exercise discretion to condone the delay if sufficient cause had been explained, but that exercise of power is discretionary in nature and may not be exercised even if sufficient cause is established for various factors such as, where there is inordinate delay, negligence and want of due diligence;
(vi) Merely some persons obtained relief in similar matter, it does not mean that others are also entitled to the same benefit if the court is not satisfied with the cause shown for the delay in filing the appeal;
(vii) Merits of the case are not required to be considered in condoning the delay; and
(viii) Delay condonation application has to be decided on the parameters laid down for condoning the delay and condoning the delay for the reason that the conditions have been imposed, tantamounts to disregarding the statutory provision.

The provisions of the Limitation Act have to be construed differently, such as Section 3 has to be construed in a strict sense whereas Section 5 has to be construed liberally – Pathapati Subba Reddy (Died) By L.Rs. and Ors. Vs. The Special Deputy Collector (LA) – Supreme Court Read Post »

Legal principles relevant in adjudicating cases where subordinate legislation (Rules/Regulations) are challenged on the ground of being ultra vires the parent Act | Rule 9(3)(b) of CA (Procedure of Investigation of Professional and Other Misconduct and Conduct of Cases) Rules, 2007 falls within the scope of the general delegation of power under Sec. 29A of ICAI Act, 1949 – Naresh Chandra Agrawal Vs. The Institute of Chartered Accountants of India and Others – Supreme Court

In this, important judgment on challenging Rules/Regulations ultra virus of main Act, Hon’ble Supreme Court has listed 8 points for adjudicating cases where subordinate legislation (Rules/Regulations) are challenged on the ground of being ‘ultra vires’ the parent Act.

Also, Hon’ble Court holds that Rule 9(3)(b) of the Chartered Accountants’ (Procedure of Investigation of Professional and Other Misconduct and Conduct of Cases) Rules, 2007 is not inconsistent with and beyond the rule-making power of the Central Government under Section 29A(1) of ICAI Act, 1949.

In this case, the Court also explains the principle of ‘generality vs enumeration’, Section 21 and 21A of ICAI Act, 1949, Rule 9 etc.

Legal principles relevant in adjudicating cases where subordinate legislation (Rules/Regulations) are challenged on the ground of being ultra vires the parent Act | Rule 9(3)(b) of CA (Procedure of Investigation of Professional and Other Misconduct and Conduct of Cases) Rules, 2007 falls within the scope of the general delegation of power under Sec. 29A of ICAI Act, 1949 – Naresh Chandra Agrawal Vs. The Institute of Chartered Accountants of India and Others – Supreme Court Read Post »

If CIRP under Insolvency & Bankruptcy Code, 2016 commences after issued sale certificate under SARFAESI Act, 2002, the rights of flat buyers cannot be affected by insolvency proceedings – Pankaj Majithia v. Honest Shelters Pvt. Ltd. and Ors. – Supreme Court

Hon’ble Supreme Court observes that a relevant aspect is that on 26.06.2019, a sale certificate was issued under the SARFAESI Act, 2002 in terms whereof while giving the description of the immovable property have been specifically excluded. Reasons for this is that qua these flats the work is assigned to respondent No. 1 and there are flat buyers who made payment in respect thereof. The orders of Real Estate Regulatory Authority (RERA) dated 20.03.2023 and 19.07.2023 required to complete the project and handover possession to the flat owners. The obligations of the flat buyers would be governed by their agreements. It is perceived that the impugned order would amount to revisiting this issue by the NCLT.
The Hon’ble Court held that since the process by the NCLT under the IBC commences on 06.11.2019 and the sale certificate was issued on 26.06.2019, the rights of respondent No. 1 and the flat buyers cannot be affected by this process. Thus the NCLT is not to examine these aspects which apparently troubles the parties.

If CIRP under Insolvency & Bankruptcy Code, 2016 commences after issued sale certificate under SARFAESI Act, 2002, the rights of flat buyers cannot be affected by insolvency proceedings – Pankaj Majithia v. Honest Shelters Pvt. Ltd. and Ors. – Supreme Court Read Post »

In Resolution Plan of Real Estate Company, No distinction can be made between Home Buyers who had approached RERA and obtained decree for refund and Other Homebuyers, both are remained the same as Homebuyers within a class – Vishal Chelani & Ors. Vs. Debashis Nanda – Supreme Court

In this case, some home buyers sought decree from UPRERA. In the Resolution Plan, a distinction was made between home buyers, who had opted or elected for other remedies such as i.e. applying before the RERA and having secured orders in their favor, and those who did not do so.

Hon’ble Supreme Court held that:
(i) On a plain reading of Section 5(8)(f) no distinction is per se made out between different classes of financial creditors for the purposes of drawing a resolution plan.
(ii) The reasoning of the Mumbai Bench of NCLT “Mr. Natwar Agrawal (HUF) Vs. Ms. Ssakash Developers & Builders Pvt. Ltd (2023) ibclaw.in 425 NCLT” is correct in the opinion of this Court.
(iii) It is only home buyers that can approach and seek remedies under RERA – no others. In such circumstances, to treat a particular segment of that class differently for the purposes of another enactment, on the ground that one or some of them had elected to take back the deposits together with such interest as ordered by the competent authority, would be highly inequitable.
(iv) Section 238 of the IBC contains a non obstante clause which gives overriding effect to its provisions. Consequently its provisions acquire primacy, and cannot be read as subordinate to the RERA Act.
(v) Set aside the NCLAT’s Order.

In Resolution Plan of Real Estate Company, No distinction can be made between Home Buyers who had approached RERA and obtained decree for refund and Other Homebuyers, both are remained the same as Homebuyers within a class – Vishal Chelani & Ors. Vs. Debashis Nanda – Supreme Court Read Post »

Condonation of delay being a discretionary power available to courts, exercise of discretion must necessarily depend upon the sufficiency of the cause shown and the degree of acceptability of the explanation, the length of delay being immaterial – Sheo Raj Singh (Deceased) Through Lrs. & Ors. Vs. Union of India & Anr. – Supreme Court

Hon’ble Supreme Court held that:
(i) Condonation of delay being a discretionary power available to courts, exercise of discretion must necessarily depend upon the sufficiency of the cause shown and the degree of acceptability of the explanation, the length of delay being immaterial.
(ii) Sometimes, due to want of sufficient cause being shown or an acceptable explanation being proffered, delay of the shortest range may not be condoned whereas, in certain other cases, delay of long periods can be condoned if the explanation is satisfactory and acceptable.
(iii) Each case for condonation of delay based on existence or absence of sufficient cause has to be decided on its own facts.
(iv) Law is fairly well-settled that “a court of appeal should not ordinarily interfere with the discretion exercised by the courts below”.

Condonation of delay being a discretionary power available to courts, exercise of discretion must necessarily depend upon the sufficiency of the cause shown and the degree of acceptability of the explanation, the length of delay being immaterial – Sheo Raj Singh (Deceased) Through Lrs. & Ors. Vs. Union of India & Anr. – Supreme Court Read Post »

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