'Delegation Of Refund Power To Adjudicating Officer Not Contrary To Scheme Of RERA Act': Bombay High Court

The Bombay High Court has held that the delegation of the power to direct refund to an Adjudicating Officer is not contrary to the scheme of the Real Estate (Regulation and Development) Act, 2016. The Court observed that while adjudication of compensation is exclusively within the domain of the Adjudicating Officer, other powers of the Authority, including directing a refund, can be delegated under Section 81 of the Act.Justice Somasekhar Sundaresan was hearing a writ petition filed by Marvel Landmarks Pvt. Ltd. seeking to quash an order dated 17.12.2019 passed by the Adjudicating Officer directing the refund of Rs. 1,35,99,246/- with interest to a flat purchaser, and a subsequent recovery order dated 08.10.2021. The petitioner contended that in view of the Supreme Court's judgment in Newtech Promoters and Developers Pvt. Ltd. v. State of UP [(2021) 18 SCC 1], the Adjudicating Officer lacked jurisdiction to order a refund, rendering the impugned orders non est. The Court examined the scheme of the RERA Act, noting that the Authority consists of a Chairperson and members, while Adjudicating Officers are appointed to adjudicate compensation claims. It observed that Section 71 confers exclusive jurisdiction on Adjudicating Officers for compensation, but Section 81 permits the delegation of other powers and functions of the Authority to its officers.Dealing with reliance on Newtech, the Court held that the Supreme Court in that case was concerned with whether a member of the Authority could direct a refund, and not with whether such power could be delegated to an Adjudicating Officer. It observed that the judgment cannot be read to prohibit delegation under Section 81 and must be understood in the context of the issue decided therein.The Court further noted that the Adjudicating Officer, being a judicial officer, is competent to undertake the relatively limited inquiry involved in directing a refund, which is largely based on documentary evidence. It held that the statutory scheme does not prohibit such delegation and that such an interpretation would not be inconsistent with the Act.“… a judicially trained Adjudicating Officer, in whose domain a quasi-judicial adjudication would lie, would be able to undertake the lesser task of conducting a summary procedure to decide a refund. Therefore, delegation of the exercise of refund power to the Adjudicating Officer is not contrary to the scheme of the Act,” the Court observed. On facts, the Court found that the impugned order had attained finality as the petitioner had not availed the statutory remedy of appeal. It also noted that the writ petition was filed after a significant delay, including nearly three years after the Newtech judgment, and that settled rights cannot be reopened on the basis of a subsequent interpretation of law. The Court held that it was not inclined to exercise discretionary writ jurisdiction to reopen concluded proceedings, particularly in view of the delay and conduct of the petitioner.Accordingly, the High Court dismissed the writ petition and declined to interfere with the impugned order of refund and the recovery proceedings.Case Title: Marvel Landmarks Pvt. Ltd. vs. State of Maharashtra & Ors. [Writ Petition No. 12121 of 2024]Click Here To Read/Download Order

'Delegation Of Refund Power To Adjudicating Officer Not Contrary To Scheme Of RERA Act': Bombay High Court

Saksham Vaishya

Tags