Appeal No. 79 of 2021
The Tamil Nadu Real Estate Appellate Tribunal (Tamil Nadu, Puducherry, Andaman and Nicobar Islands), in Appeal No. 79 of 2021 dated 17 November 2021, dismissed an appeal by M/s. VGN Property Developers Private Limited because the promoter failed to make the required pre-deposit. The appeal challenged an Adjudicating Officer’s direction to refund Rs.33,15,281 with interest and pay compensation and litigation costs to two purchasers.
What the case concerns
Appeal No. 79 of 2021 was filed by M/s. VGN Property Developers Private Limited against E. Narayanan and Gajalakshmi Narayanan. The promoter challenged the Adjudicating Officer’s order in C.C.P. No. 348 of 2019, dated 25 February 2021.
The purchasers had sought a refund of the sale consideration with interest and compensation. The Adjudicating Officer partly allowed their complaint and directed the promoter to pay:
- Refund of Rs.33,15,281.
- Interest at 10.05 per cent per annum.
- Compensation of Rs.2,00,000 for mental agony.
- Litigation costs of Rs.25,000.
Pre-deposit requirement
The Tamil Nadu Real Estate Appellate Tribunal required the promoter to deposit 40 per cent of the total amount ordered by the Adjudicating Officer. The direction was made in M.A. No. 96 of 2021 under the Real Estate (Regulation and Development) Act, 2016.
The record shows that:
- The promoter did not make the initial deposit within the time allowed.
- Further time was granted more than once.
- A partial payment of Rs.7,13,524 was made, but it did not satisfy the full 40 per cent requirement.
- A later extension required payment of Rs.5,000 to the Tamil Nadu Chief Minister’s Relief Fund for corona and payment of the remaining deposit.
- The promoter paid the relief fund amount but did not pay the remaining pre-deposit within the permitted time.
Tribunal’s decision
The Tamil Nadu Real Estate Appellate Tribunal rejected M.A. No. 178 of 2021, which sought another extension of time. It referred to the Supreme Court judgment in New Tech Promoters and Developers Private Limited versus State of Uttar Pradesh and Others, dated 11 November 2021, concerning the pre-deposit requirement.
Because the required deposit was not completed, the Tribunal dismissed M.A. No. 96 of 2021 and consequently dismissed Appeal No. 79 of 2021 for non-compliance. All connected miscellaneous applications were also closed.
Who is affected
Appeal No. 79 of 2021 directly affects the promoter and the two purchasers named in the proceedings. It also shows that a promoter appealing against an Adjudicating Officer’s monetary direction may lose the appeal without consideration of its merits if a mandatory pre-deposit direction is not complied with.
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Common questions
Did the Tribunal allow VGN Property Developers’ appeal?
No. The Tamil Nadu Real Estate Appellate Tribunal dismissed Appeal No. 79 of 2021 because the promoter did not complete the required pre-deposit.
How much was the promoter directed to refund to the purchasers?
The Adjudicating Officer directed a refund of Rs.33,15,281 with interest at 10.05 per cent per annum, along with Rs.2,00,000 as compensation and Rs.25,000 as litigation costs.
Did the promoter make any part of the required deposit?
Yes. The promoter paid Rs.7,13,524, but the Tribunal found that this was not the full 40 per cent pre-deposit required.
Why was the request for more time rejected?
The promoter had already received extensions but did not pay the remaining pre-deposit within the final permitted time. The Tribunal held that the later extension application was not maintainable and dismissed it.
