Haryana Tribunal Sets Precedent: Act's Retroactive Application Upheld in Shalimar Estates Case

In a recent case heard before the Haryana Real Estate Appellate Tribunal, appeals were filed by Shalimar Estates Private Limited, a real estate company, against two allottees, Mr. Rajesh Sharma and Ms. Meena Kapoor. The appeals arose from a decision made by the Haryana Real Estate Regulatory Authority, Panchkula, in response to complaints filed by Mr. Sharma and Ms. Kapoor seeking a refund of their deposited amount due to Shalimar Estates' failure to fulfill the terms of their agreement. The key issue in this case was whether the authority had jurisdiction over the complaints as the project in question was an unregistered project.

Background:

Mr. Sharma and Ms. Kapoor approached the authority seeking a refund of their deposited amount as Shalimar Estates had allegedly not complied with the terms of the agreement for the allotted units. Shalimar Estates argued that the authority did not have jurisdiction over complaints related to unregistered projects, citing a Supreme Court judgment. However, the authority rejected this argument and asserted its jurisdiction.

The Appeals:

Feeling aggrieved, Shalimar Estates filed appeals against the authority's decision. The company claimed that its project was fully completed before the implementation of the Real Estate (Regulation and Development) Act, 2016, and therefore, the authority did not have jurisdiction over the complaints. Shalimar Estates argued that the Act applied to ongoing and future projects only after their registration, and since their project was unregistered, it fell outside the purview of the Act.

Counterargument by Mr. Sharma and Ms. Kapoor:

Mr. Sharma and Ms. Kapoor's counsel countered Shalimar Estates' argument, stating that the Act applied to unregistered projects as well. They cited a Supreme Court judgment, which held that the Act's provisions could be retroactively applied to ongoing projects that had not received a completion certificate.

Tribunal's Decision:

The tribunal carefully considered the arguments presented by both Shalimar Estates and Mr. Sharma and Ms. Kapoor. It examined the Supreme Court judgment and noted that the Act was intended to regulate both ongoing and future projects, including unregistered projects. The tribunal emphasized that the Act's application was retroactive in nature, meaning it could cover ongoing projects that had not yet obtained a completion certificate.

In this case, Shalimar Estates failed to provide evidence that they had completed their project or obtained a completion certificate before the Act came into effect. The tribunal concluded that the authority had jurisdiction to adjudicate the dispute between Shalimar Estates and Mr. Sharma and Ms. Kapoor.

Conclusion:

Ultimately, the Haryana Real Estate Appellate Tribunal dismissed the appeals filed by Shalimar Estates, affirming the authority's jurisdiction over the complaints filed by Mr. Sharma and Ms. Kapoor. The tribunal's decision clarified that the Act applied to ongoing and unregistered projects, providing protection to both allottees and promoters. This case serves as a precedent, ensuring that unscrupulous promoters cannot evade the Act's provisions by keeping their projects unregistered. The judgment upholds the interests of homebuyers and promotes transparency and accountability in the real estate sector.

Note: The information provided in this article about Haryana Real Estate Regulatory Authority (HRERA) is for informational purposes only. It is not intended as legal or professional advice and readers should consult qualified professionals for advice specific to their circumstances. The information provided in this article is based on the Appeals No. 499 & 501 of 2022 before the Haryana Real Estate Regulatory Authority

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