Court Rules Appeal to High Court under RERA Act Permissible Only on Substantial Questions of Law, Confirms Tribunal's Remand for Determining Validity of Allotment Cancellation
In a significant judgment delivered by Justice Syed Qamar Hasan Rizvi of the Allahabad High Court, the court affirmed the remand of a Real Estate Regulatory Authority (RERA) dispute for fresh adjudication, emphasizing the limited scope of appeals under Section 58 of the Real Estate (Regulation and Development) Act, 2016 ("RERA Act"). The judgment arose from an appeal filed by M/s Balaji Infracare Pvt. Ltd. against an order of the Uttar Pradesh Real Estate Appellate Tribunal, which had set aside the Regulatory Authority's order refunding an allottee's deposit and remanded the matter for reconsideration of the legality and validity of the cancellation of the allotment.
The dispute originated from the allotment of a flat in the `Lav Kush Apartment' project by M/s Balaji Infracare Pvt. Ltd. to respondent Vikas Sharma. Following delayed payments and non-execution of the sale agreement, the appellant cancelled the allotment by a letter dated 26 October 2019. The respondent challenged the cancellation before the Regulatory Authority, which directed the appellant to refund the deposited amount but did not award delay interest. Dissatisfied, the respondent appealed to the RERA Appellate Tribunal, which remanded the matter to the Regulatory Authority to decide the legality of the cancellation under Section 11(5) of the RERA Act within twelve weeks.
The appellant challenged this remand in the High Court under Section 58 of the RERA Act, contending that the Tribunal had exceeded its jurisdiction by remanding a matter beyond pleadings and that the cancellation had become final and could not be reopened after years. The appellant also argued that the appeal was barred by limitation and that reopening the issue would prejudice the rights of other purchasers.
The High Court, after thorough analysis, held that:
- - Appeals to the High Court under Section 58 of the RERA Act are confined to substantial questions of law as specified under Section 100 of the Code of Civil Procedure, 1908 (CPC).
- - A "substantial question of law" must be debatable, unsettled, materially affect party rights, and emerge from pleadings and findings of fact.
- - The Tribunal's remand for fresh consideration of the cancellation letter's legality under Section 11(5) RERA Act was within its jurisdiction and necessary for a complete adjudication of the dispute.
- - The Regulatory Authority had not previously addressed the legality and validity of the cancellation, which was central to the respondent's claim for delay interest under Section 18 of the RERA Act.
- - The Tribunal's order did not finally determine parties' rights but only called for further inquiry, which does not ordinarily warrant interference by the High Court.
- - The appellant's grounds did not raise any substantial question of law justifying appeal or interference with the remand order.
The Court further highlighted the inherent power of appellate courts under Order XLI Rule 23 CPC (as amended in Uttar Pradesh) to remand cases for justice, even if the trial court had decided on merits, where necessary to resolve unresolved controversies.
The judgment reiterates the principle that courts should not grant relief beyond pleadings to avoid miscarriage of justice, but also confirms that remand orders facilitating full adjudication of disputes are permissible and often essential.
The appeal was dismissed, and the matter was left to the Regulatory Authority for fresh hearing and decision in accordance with the Tribunal's directions.
This ruling clarifies the appellate scope under the RERA Act and reinforces procedural safeguards ensuring fair hearings on fundamental issues such as allotment cancellation and entitlement to delay interest.
Bottom Line:
Real Estate Regulation - Appeal under Section 58 of the Real Estate (Regulation and Development) Act, 2016 lies only on substantial questions of law as specified under Section 100 of the CPC, 1908.
Statutory provision(s):
Real Estate (Regulation and Development) Act, 2016 Sections 11(5), 18, 58; Code of Civil Procedure, 1908 Section 100, Order XLI Rule 23.
M/s Balaji Infracare Pvt. Ltd. v. Vikas Sharma, (Allahabad)(Lucknow) : Law Finder Doc Id # 2974598
