Case law, Tamil Nadu land law
Appeal No. 74 of 2019
The Tamilnadu Real Estate Appellate Tribunal issued its order in Appeal No. 74 of 2019 on 24 March 2020, allowing an appeal by M/s. Alliance Villas Private Limited against an ex parte order obtained by allottee Mr. Rajesh. The Tribunal set aside the Adjudicating Officer's order and returned the complaint for a fresh decision, subject to the promoter paying costs of Rs.5,000 by 8 April 2020.
What the case concerns
Appeal No. 74 of 2019 arose from a complaint by allottee Mr. Rajesh seeking a refund of the sale consideration, interest and compensation from promoter M/s. Alliance Villas Private Limited. The promoter did not appear before the Adjudicating Officer despite receiving summons, and an ex parte order was passed on the merits.
The promoter appealed to the Tamilnadu Real Estate Appellate Tribunal. It said that staff miscommunication prevented the summons and hearing date from reaching the appropriate officers. It also argued that it needed an opportunity to contest questions about the applicable Goods and Services Tax treatment and the allottee's cancellation.
What the Tribunal decided
The Tamilnadu Real Estate Appellate Tribunal accepted that the promoter had been properly served and that its own staff had failed to communicate the hearing details. However, the Tribunal decided that the promoter should receive an opportunity to contest the complaint on its merits, particularly because a legal issue concerning Goods and Services Tax had been raised.
Key directions were:
- The appeal was allowed subject to payment of Rs.5,000 to the Tamil Nadu Chief Minister's Relief fund for Corona Virus on or before 8 April 2020.
- Failure to pay the costs by that date would automatically dismiss the appeal.
- The Adjudicating Officer's order in C.C.P. No. 189 of 2019, dated 22 November 2019, was set aside.
- The complaint was returned to the Adjudicating Officer for final disposal.
- The promoter was directed to file its counter, if any, within 15 days after receiving a copy of the Tribunal's order.
- The promoter was required to cooperate with the enquiry without seeking further adjournments.
Effect on the parties
Appeal No. 74 of 2019 did not finally decide whether the buyer or promoter was responsible for the disputed Goods and Services Tax amount. The Tribunal stated that the Adjudicating Officer must decide that issue on its merits.
The promoter had already deposited 30% of the amount awarded by the Adjudicating Officer. The Tribunal directed that this deposit remain in its fixed deposit account until C.C.P. No. 189 of 2019 is decided, after which it must be paid to the appropriate party according to the Adjudicating Officer's decision.
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Common questions
Did the Tribunal finally decide who must pay the disputed GST?
No. The Tamilnadu Real Estate Appellate Tribunal stated that the merits of the Goods and Services Tax issue must be decided by the Adjudicating Officer.
Why was the promoter given another opportunity to defend the complaint?
The promoter admitted that summons had been served but said staff miscommunication prevented it from appearing. The Tribunal considered the legal issue raised and the promoter's 30% deposit, and decided that the complaint should be heard on its merits.
What happens to the 30% amount deposited by the promoter?
The amount must remain in the Tribunal's fixed deposit account until C.C.P. No. 189 of 2019 is decided. It will then be paid to the party entitled to it under the Adjudicating Officer's decision.
Was the appeal allowed without conditions?
No. M/s. Alliance Villas Private Limited had to pay costs of Rs.5,000 to the Tamil Nadu Chief Minister's Relief fund for Corona Virus by 8 April 2020, failing which the appeal would automatically stand dismissed.
