Appeal No.62 of 2023

What the case was about

Appeal No.62 of 2023 arose from sale and construction agreements entered into on 23 January 2015 between two allottees and M/s. P dot G Constructions Private Limited. The agreements concerned an apartment and required the promoter to deliver the completed apartment within 30 months from obtaining building plan approval from the Chennai Metropolitan Development Authority.

The allottees stated that they had paid a total of Rs.24,75,000 and had taken possession of the flat. They asked the Tamil Nadu Real Estate Regulatory Authority to direct the promoter to execute and register the sale deed for the undivided share connected with the flat.

Insolvency and change of promoter

Corporate insolvency resolution proceedings against M/s. P dot G Constructions Private Limited began before the National Company Law Tribunal on 13 July 2018. M/s. RCC E-Construct Private Limited later became the new promoter under the approved resolution process.

M/s. RCC E-Construct Private Limited argued that:

• The dispute was governed by proceedings before the National Company Law Tribunal.
• The Real Estate (Regulation and Development) Act, 2016 did not apply.
• The allottees had failed to file a claim in the insolvency proceedings.

The Tribunal found that the new promoter had stepped into the position of the earlier promoter and was bound by the sale and construction agreements dated 23 January 2015.

Tribunal's findings

The Tamil Nadu Real Estate Appellate Tribunal relied on the Supreme Court decision in Pioneer Urban Land and Infrastructure Limited and another versus Union of India and others. That decision stated that homebuyers may approach the Real Estate Regulatory Authority, Consumer Forum and National Company Law Tribunal concurrently for adjudication of their grievances.

The Tribunal also noted that:

• The agreements and substantial payments predated the insolvency proceedings.
• The allottees were already in possession of the flat.
• The allottees sought registration of the sale deed, not a refund or compensation.
• The allottees remained responsible for the balance sale consideration and the incremental demand under the approved resolution plan.

Result and practical effect

Appeal No.62 of 2023 was dismissed. The promoter must execute the sale deed for the undivided share after receiving the balance amount due under the agreements and the incremental demand payable under the National Company Law Tribunal approved resolution plan.

The decision is relevant to allottees whose project promoter changes through insolvency proceedings, particularly where possession has been delivered but the sale deed remains unregistered.