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M/S PARAMOUNT PROP BUILD PVT LTD THROUGH MR ANIL KUMAR GUPTA V STATE OF U.P. AND 49 OTHERS
This case is about a writ petition that was filed through Mr. Anil Kumar Gupta on behalf of Paramount Prop Build Pvt Ltd before the honorable Allahabad High Court.
Facts of the Case: The petitioner is the promoter of the Paramount Golf Foreste Project for the construction of apartments. The respondent nos. 4 to 50 booked the apartments with the petitioner. Eventually, the petitioner issued allotment letters to them on the 10th of August 2011. However, the petitioner was unable to complete the project within the given time, and therefore was unable to handover the possession of the apartment to the allottees. Regarding this, the respondent filed a complaint before the Real Estate Regulatory Authority, Gautam Budh Nagar alleging that the completion of the project had been delayed for more than four years and also they claimed interest and possession of apartments. However, the petitioner questioned that this project does not fall within the jurisdiction of the ongoing project as defined in Rule 2(h) of Uttar Pradesh Real Estate (Regulation and Development) Rules, 2016. The authority looked into the facts of the case based on evidence on record including the inspection report which was issued on 24th of July, 2019. The report and the findings by the authority stated that the work was incomplete and some No Objection Certificate including No objection Certificate also known as NOC of fire fighting etc to some technical term had not yet been obtained. This, the authority on 18th of October 2019 directed the petitioner to handover the possession of apartments to the allottees within sixty days from the date of issuance of the order. And also the authority stated to pay interest on delayed completion of the project. The petitioner on being aggrieved by the impugned order filed by the writ petition before the honorable Allahabad High Court.
Argument By the learned Counsel: The learned counsel for the petitioner stated that the project of the petitioner regarding this case is not an ongoing project. The learned counsel further stated that he had already applied for the completion certificate with the Uttar Pradesh State Industrial Corporation on the 13th of October 2016. Thus, if the provision of Rule 2(h) of the Rules 2016 is observed properly, then it can be stated that this project cannot be identified as an ongoing project and therefore it also cannot be registered under Section 3(1) of the Act 2016. Thus, the RERA authority would not have the jurisdiction to look into this matter. However, the Court had asked the learned counsel of the petitioner, whether the petitioner would like to exercise the option to avail the remedy of appeal but the learned counsel of the petitioner stated that the petitioner wants to stick to the above-stated point I.e. the project was not an ongoing project.
Analysis of the Case: The Court started to look into the case. The Court opined that clause (iv) of Rule 2(h) of the Rules 2016 is required to be observed vividly in this case. Clause (iv) of Rule 2(h) is an exception to the Rule. An ongoing project is stated in Rule 2(h). Rule 2(h) states about the ongoing project, which means that a project development that is going on and for which on completion a completion certificate had not been issued. And the clause (iv) states that the project will not be identified as an ongoing project where all the development works had been completed and the application can be filed with the authority for a completion certificate. The honorable Court also opined that the petitioner had already applied before the competent authority for insurance of completion certificate.
After analyzing Rule 2(h) of the Rules Act 2016 and Section 3 of the Rules Act 2016 which provides rules for prior registration of the real estate project with the Real Estate Registration Authority, the Court stated that in a case of a project where all development had not been completed, the mere filing of an application with the competent authority for issuing a completion certificate would not come under the purview of an ongoing project. Such projects will be held as an ongoing project as per Section 3(1) of the Act 2016 and not as per Rule 2(h) of the Rules 2016.
The court also stated that in this case other rules are not required to be used. The court also stated that as stated above in Section 3 of the Act 2016, the rules for prior registration for real estate projects with the Real Estate Regulatory Authority and in terms of subsection (1) thereof no promoter shall advertise, market, book, sell, offer for sale, or invite persons to purchase in any manner any plot, apartments or buildings, as the case may be, in any real estate project or part of it, in any planning area, without registering the real estate Project.
However, in this case, the finding recorded by the RERA Authority stated that the work was incomplete. The finding was based on consideration of the material evidence on record. Therefore, this cannot be excluded under Rule 2(h) of the Act.
Judgment: The Court finally gave the verdict on 4.11.2020. The Cout stated that the project Paramount Golf Foreste will be held as an ongoing project under Rule 2(h) and would have to be registered under Section 3(1) of Rules Act 2016. The Court also stated that the impugned order passed by RERA is not without jurisdiction.
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