A.No. 02/2022, M/s. Mahindra Residential Developers Limited v. R. Arun Prasad

What the case decides

The Tamil Nadu Real Estate Appellate Tribunal decided A.No. 02/2022 on 25 February 2022. The appeal challenged the Adjudicating Officer's decision in C.C.P.No.165/2021, dated 30 November 2021, which directed the promoter to refund Rs.7,39,028 with interest at 9.30%, pay compensation of Rs.50,000, and pay litigation costs of Rs.25,000.

The Tribunal held that, following the Supreme Court judgment dated 11 November 2021 in M/s. Newtech Promoters and Developers Private Limited v. State of Uttar Pradesh and others, the Adjudicating Officer had no power to decide the refund question. It therefore set aside the Adjudicating Officer's decision and sent the complaint to the competent authority in RERA for a fresh decision.

Who is affected

A.No. 02/2022 directly concerns M/s. Mahindra Residential Developers Limited, the promoter and appellant, and R. Arun Prasad, the home buyer and respondent. The home buyer had sought a refund of the sale consideration, interest, compensation and litigation costs.

The Tribunal did not finally decide whether the buyer was entitled to the refund or whether the Real Estate Regulation and Development Act applied. It allowed the parties to raise their claims and defences before the competent authority during the fresh proceedings.

Key directions

The Tamil Nadu Real Estate Appellate Tribunal gave the following directions in A.No. 02/2022:

• The Adjudicating Officer's decision in C.C.P.No.165/2021 was set aside because it was made without authority.
• C.C.P.No.165/2021 was sent back to the competent authority in RERA to be considered afresh.
• Both parties were directed to appear before the competent authority on 31 March 2022.
• The promoter had deposited a total of Rs.11,36,834 before the Tribunal, covering the refund, interest, compensation and litigation costs.
• Rs.7,39,028, representing the amount paid by the buyer, was to remain in a bank deposit until C.C.P.No.165/2021 was decided.
• The promoter was permitted to withdraw the remaining deposited amount after filing the necessary cheque application.
• No costs were awarded in the appeal, and connected miscellaneous applications were closed.

Practical effect

The Tribunal's decision cancelled the earlier refund award but did not dismiss the buyer's complaint. The refund dispute had to be decided again by the competent authority, while the buyer's payment of Rs.7,39,028 remained protected in deposit pending that decision.