Case law, Tamil Nadu land law
Appeal Nos. 74 and 75 of 2021, Common Order
The Tamil Nadu Real Estate Appellate Tribunal (Tamil Nadu, Puducherry, Andaman & Nicobar Islands) issued the common order in Appeal Nos. 74 and 75 of 2021 on 22 October 2021. It dismissed the waiver applications and both appeals filed by M/s. VGN Developers Private Limited because the promoter did not make the required 40% pre-deposit.
What the cases concerned
Appeal Nos. 74 and 75 of 2021 arose from a common order of the Adjudicating Officer in C.C.P. Nos. 267 and 268 of 2019, dated 12 February 2021. The complainants had sought refunds of their sale consideration with interest and compensation from the promoter, M/s. VGN Developers Private Limited.
The Adjudicating Officer partly allowed the complaints and directed the promoter to:
- Refund the respective sale consideration amounts with interest at 10.05% per year in each case.
- Pay compensation of Rs.5,00,000 in one case and Rs.7,00,000 in the other.
- Pay litigation expenses of Rs.30,000 in each case.
M/s. VGN Developers Private Limited challenged those directions before the Tamil Nadu Real Estate Appellate Tribunal.
Pre-deposit requirement
The Tamil Nadu Real Estate Appellate Tribunal considered M.A. Nos. 83 and 85 of 2021, which sought waiver of the deposit required under Section 43(5) of the Real Estate (Regulation and Development) Act, 2016. The Tribunal directed the promoter to deposit 40% of the total amount ordered by the Adjudicating Officer.
The promoter's counsel had previously referred to the pandemic situation and requested more time. The Tribunal granted a final extension until 21 October 2021 and stated that failure to pay by then would automatically dismiss the applications.
Result and who is affected
The Tribunal's office reported that no money had been deposited by the deadline. No further extension application was filed, and nobody appeared or made representations at the video conference hearing.
The Tamil Nadu Real Estate Appellate Tribunal therefore:
- Dismissed M.A. Nos. 83 and 85 of 2021 for non-compliance.
- Dismissed Appeal Nos. 74 and 75 of 2021 as a consequence.
- Closed the connected miscellaneous applications.
The decision directly affects M/s. VGN Developers Private Limited, Saranya Upendran, Rangarajan and Rekha Rangarajan. The Tribunal stated that compliance with the pre-deposit direction was mandatory and that the appeals could not be entertained without it.
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Common questions
Why were the promoter's appeals dismissed?
M/s. VGN Developers Private Limited did not deposit the required 40% of the total amount ordered by the Adjudicating Officer. The Tribunal therefore dismissed the waiver applications and both appeals for non-compliance.
Did the Tribunal give the promoter more time to make the deposit?
Yes. After counsel referred to the pandemic situation, the Tribunal granted a final extension until 21 October 2021, but its office reported that no deposit had been made.
What relief had the Adjudicating Officer awarded to the buyers?
The Adjudicating Officer directed refunds of the respective sale consideration amounts with interest at 10.05% per year. Compensation of Rs.5,00,000 and Rs.7,00,000 respectively, plus litigation expenses of Rs.30,000 in each case, was also awarded.
Could the appeals continue without the pre-deposit?
No. The Tamil Nadu Real Estate Appellate Tribunal stated that compliance with the pre-deposit direction under Section 43(5) was mandatory and that the appeals could not be entertained without it.
