Hon'ble Jayant Banerji,J.
1. Heard Sri Anubhav Singh learned counsel appearing for the petitioners and Sri Anil Tiwari learned Senior Advocate assisted by Sri Waseem Masood for respondent no. 2.
2. This bunch of writ petitions have been filed for quashing of the orders passed by respondent no. 2 namely the U.P. Real Estate Regulatory Authority, Gautam Budh Nagar, whereby the petitioners (promoters) had been directed to refund the amount deposited by the allottees alongwith interest. Sole ground pressed to challenge the orders impugned is that single member of the Authority had no jurisdiction to decide the complaint of the respondents/allottees and, as such, the order is illegal being coram non judice.
3. It is vehemently argued by the learned counsel for the petitioners that the Authority as conceptualised under the Real Estate (Regulation and Development) Act, 2016 (In short as "the RERA Act, 2016") is the Real Estate Regulatory Authority (In Short as "the RERA or the Authority"), established and incorporated under Section 20 of the RERA Act, 2016 by the appropriate Government.
The constitution/composition of the Authority is provided under Section 21 of the RERA Act, 2016 which states that the Authority shall consists of a Chairperson and not less than two whole-time Members to be appointed by the appropriate Government.
The complaint filed by the aggrieved person under Section 31 of the RERA Act, 2016 is, thus, can be adjudicated by the Authority, comprising of three members including its Chairperson. A Single Member of the Authority cannot constitute it so as to discharge the adjudicatory functions of the Authority or to exercise the powers under Sections 35 to 40 of the Act, 2016.
The orders impugned, therefore, are liable to be set aside being without jurisdiction.
4. The judgment of the High Court of Punjab and Haryana at Chandigarh dated 16th October, 2020 in Janta Land Promoters Private Limited vs. Union of India and others1 alongwith other connected writ petitions has been placed before us to submit that considering various provisions of the Act, 2016, it was held therein that the Single Member of the Authority cannot validly pass order on a complaint under the Act. Regulations 7 and 8 of the Punjab RERA (Procedure for Handling complaints and Related Matters) Regulations, 2017 by which a Single Member Bench of the Authority was entrusted to adjudicate the complaint, had been struck down as being ultra vires the Act.
5. At the outset, we may note that in the instant matter, there is no challenge to the provisions of the U.P. Real Estate Regulatory Authority (General) Regulations, 2019 (In Short as "the Regulations, 2019") framed by the U.P. Real Estate Regulatory Authority in exercise of the powers conferred on it under Section 85 of the RERA Act, 2016.
Learned counsel for the petitioner rather placed regulations 19, 20, 21 and 22 of the Regulations, 2019 to assert that if in any meeting of the Authority duly convened, the quorum is not complete, the meeting shall have to be adjourned. He submits that every meeting of the Authority to conduct its business has to be presided over by the Chairman. Only in case, where the Chairman is unable to be present in the meeting by any reason or the post itself is vacant, a Member chosen by the members present amongst themselves at the meeting shall preside. All questions before any meeting of the Authority have to be decided by a majority of votes of the Members. In any case, the quorum for the meeting of the Authority is three.
6. It is vehemently argued that in any case, under the scheme of the Act, the Authority, which has been entrusted with the powers to adjudicate on a complaint is a three Member body constituted under Section 21 of the Act. The decision of a Single Member is nothing but usurpation of power conferred upon the Authority.
7. Sri Anil Tiwari learned Senior Advocate assisted by Sri Waseem Masood appearing for respondent no. 2, on the other hand, places various provisions of the RERA Act, 2016 and relying upon Section 81 of the Act, it is submitted that the Authority has power to delegate any of its power and functions under the Act, except the powers to make regulations under Section 85, by general or special order in writing. The delegation of power may be on any Member, Officer of the Authority or any other person, subject to such conditions if specified in the order. In accordance with the said provision, the U.P. RERA in its meeting held on 14.8.2018 under Agenda No. 1.03 had decided to make arrangement of Benches of two Members each, for hearing of the complaints at two places of its sitting, Lucknow and Gautam Budh Nagar. In another meeting held on 5.12.2018 under Agenda No. 1, it was decided that Single Member Bench be created for disposal of the complaints as and when required at both the places of sitting, Lucknow and Gautam Budh Nagar. With reference to paras 18 to 23 of Regulations 2019 framed by U.P. RERA, it is argued that the procedure for conducting the meetings of the Authority specified by the regulations makes it clear that the quorum for the meeting of the Authority of three Members as per Regulation 19, is required for transaction of its business other than the adjudicatory proceedings.
The contention is that Section 29 of the RERA Act, 2016 provides that in regard to the transaction of business at its meetings, the Authority shall follow the rules of procedure, including quorum at such meetings, as prescribed in the regulations framed by it. Section 85 empowers the Authority to make regulations consistent with the Act and rules made thereunder, on the matters as prescribed in sub-section (2) and any other matter in respect of which provision is to be made by regulations to carry out the purposes of the Act. In exercise of its power under Section 85, Regulations 2019 have been framed by U.P. RERA Authority to formulate the rules of procedure for transactions of its business. Regulations 18 to 25 have been framed to provide procedure for the meetings of the Authority, other than the adjudicatory functions of the Authority. Regulation 24 refers to conduct of adjudication proceedings and provides that with respect to the complaints filed with the Authority, the Authority may, by order, direct that specific matters or issues be heard and decided by a Single Bench of either the Chairperson or any Member of the Authority.
It is then argued that the RERA Act, 2016 has been framed with an object to provide adjudicatory mechanism for speedy redressal of the disputes. There is only one Authority for the State of U.P. By notification dated 19.9.2018, the State Government has provided two places of sitting of the RERA Authority, one at Lucknow as Headquarter and another at Greater Noida, Gautam Budh Nagar as Regional Office. More than 30,000 complaints are pending before the RERA Authority and in view of the rising numbers of complaints, arrangement has been made to create benches for hearing and speedy disposal of the complaints. The Division Benches of this Court in similar matters have taken the view that the delegation of power to a Single Member of the Authority to decide the complaints is in valid exercise of power under Section 81 of the RERA Act, 2016. Some of the decisions appended with the counter affidavit have been placed before us to substantiate the above assertions.
8. Learned counsel for the petitioner, in rejoinder, however, states that one such decision in M/s K.D.P. Build Well Pvt. Ltd. v. State of U.P.2 had been placed before the Division Bench of Punjab and Haryana High Court. In the above noted decision, the Division Bench of the said Court had expressed its disagreement with the conclusion drawn therein that under Section 81 of the Act, the Authority could have delegated its adjudicatory function to a Single Member. It was observed therein that it is inconceivable that the Authority could issue a general or special written orders to entrust the adjudicatory functions of the Authority to a Single Member, contrary to the express wording of Section 21 of the Act requiring the Authority to comprise of a Chairperson and two members.
It is argued that unless there is an express provision in the Act itself permitting the Authority to sit in Benches with lesser number of members or a Single Member, it is not possible for the Authority, either in exercise of its power under Section 81 or Section 85, to entrust its adjudicatory functions in relation to complaints to a Single Member.
9. It is pertinent to note at this stage that in the matter before the Punjab and Haryana High Court, there was no order, general or special, of the Authority under Section 81 of the Act to delegate its adjudicatory power to a Single Member. In the case before the Punjab and Haryana High Court, the validity of regulations framed by the Authority therein providing for disposal of complaint by a Single Member had been challenged being ultra vires the Act.
10. In light of the above arguments, it would be apt to first go through the provisions of the Act, Rules and Regulations framed thereunder.
The Real Estate (Regulation and Development) Act, 2016 (In Short as "the RERA Act, 2016") has been enacted to establish the Real Estate Regulatory Authority (In Short "the Authority"). The long title of the Act provide the object and purpose of its establishment for regulation and promotion of the real estate sector and one of the objects is to establish an adjudicating mechanism for speedy dispute redressal and also to establish the Appellate Tribunal to hear the appeals from the decisions, directions or order of the Authority and the adjudicating officer. The "adjudicating officer" is defined under Section 2(a) means the officer appointed under sub-section (1) of Section 71. The "Authority" defined under Section 2(i), is the Real Estate Regulatory Authority established under sub-section (1) of Section 20. The "Appellate Tribunal" defined under Section 2(f) is the Real Estate Appellate Tribunal established under Section 43.
Section 20 of the Act provides for establishment and incorporation of Real Estate Regulatory Authority by the appropriate Government, which is the "State Government" within the meaning of Section 2(g)(iv). Section 20(1) states that the appropriate Government shall establish an Authority to be known as the Real Estate Regulatory Authority to exercise the powers conferred on it and to perform the functions assigned to it under the Act.
As per sub-section (2) of Section 20, the Authority so established shall be a body corporate having perpetual succession and a common seal, with the power, subject to the provisions of the Act, to acquire, hold and dispose of property, both movable and immovable and to contract, and shall, by the said name, sue or be sued.
The composition of the Authority is provided under Section 21, which reads as under:-
"21. Composition of Authority:- The Authority shall consist of a Chairperson and not less than two whole-time Members to be appointed by the appropriate Government."
11. As we understand from the careful reading of Sections 20 and 21 of the Act, the Authority established under Section 21, as per its constitution provided therein, shall be a body which is empowered to discharge the functions assigned to it under the Act, in exercise of the powers conferred on it. The object to establish the Authority is to regulate and promote the real estate sector and to ensure sale of plot, apartment or building, as the case may be, or sale of real estate project in an efficient and transparent manner. It has been given power, subject to the provisions of the Act, to acquire, hold and dispose of property, both movable and immovable, and to enter into contract by its name. The adjudicatory functions of the Authority is only one of the various functions provided under Section 32 & and Section 34 of the RERA Act, 2016, relevant clauses of the Section 34 read as under:-
"(f) to ensure compliance of the obligations cast upon the promoters, the allottees and the real estate agents under this Act and the rules and regulations made thereunder;
(g) to ensure compliance of its regulations or orders or directions made in exercise of its powers under this Act;"
Section 31 of the Act provides that the complaint, for any violation or contravention of the provisions of the Act or the rules and regulations made thereunder, against any promoter allottee or real estate agent, may be filed with the Authority or the adjudicating officer, as the case may be. Sections 35 to 40 confer powers on the Authority to pass orders, issue directions including interim orders on the complaints requiring such person who act in contravention of the Act, rules and regulations, to comply the same and to impose penalty or interest, in regard to any contravention of obligations cast upon such person. While making an inquiry on such complaint, the Authority has the powers, in respect to matters provided in sub-section (2) of Section 35, as are vested in a civil court under the Code of Civil Procedure while trying a suit. Section 38 (2) provides that in making such order or direction, the Authority shall be guided by the principles of natural justice and subject to the above provisions of this Act and the Rules made thereunder, it shall have powers to regulate its own procedure. Section 40 confers power upon the Authority to execute its own orders and make recovery from such person against whom an order of imposition of interest or penalty has been passed. Section 71 of the Act prescribes for appointment of one or more judicial officer as deemed necessary, by the Authority in consultation with the appropriate Government as an adjudicating officer for holding an inquiry in the matter of adjudging compensation under Sections 12, 14, 18 and 19 of the Act, 2016. Chapter VII deals with the establishment of the Real Estate Appellate Tribunal and its powers both administrative and adjudicatory.
12. It can, thus, be seen that three adjudicatory forums have been created under the RERA Act, 2016. The complaint filed by an aggrieved person for violation or contravention of the provisions of the Act or the rules or regulations made thereunder against any promoter, allottee or Real Estate Agent has to be dealt with by the Authority in accordance with its powers under Sections 35 to 40 contained in Chapter V of the Act. The Real Estate Appellate Tribunal is constituted only to deal with the appeals from the decisions, directions or orders of the Real Estate Regulatory Authority or an adjudicatory officer under the Act. The administrative powers of Chairperson of the Appellate Tribunal is restricted to the powers of general superintendence and direction in the conduct of the affairs of Appellate Tribunal.
Section 81 which confers power of delegation and Section 85 conferring power to make regulations to the Authority read as under:-
"81. Delegation.- The Authority may, by general or special order in writing, delegate to any member, officer of the Authority or any other person subject to such conditions, if any, as may be specified in the order, such of its powers and functions under this Act (except the power to make regulations under section 85) as it may deem necessary.
85. Power to make regulations.- (1) The Authority shall, within a period of three months of its establishment, by notification, make regulations, consistent with this Act and the rules made thereunder to carry out the purposes of this Act.
(2) In particular, and without prejudice to the generality of the foregoing power, such regulations may provide for all or any of the following matters, namely:--
(a) [* * *]
(b) [* * *];
(c) such other information and documents required under clause (f) of sub-section (1) of section 11;
(d) display of sanctioned plans, layout plans along with specifications, approved by the competent Authority, for display under clause (a) of sub-section (3) of section 11;
(e) preparation and maintenance of other details under sub-section (6) of section 11;
(f) time, places and the procedure in regard to transaction of business at the meetings of the Authority under sub-section (1) of section 29;
(g) [* * *];
(h) standard fees to be levied on the promoter, the allottees or the real estate agent under clause (e) of section 34;
(i) any other matter which is required to be, or may be, specified by regulation or in respect of which provision is to be made by regulations."
13. From a careful reading of Section 81, it is clear that the Authority can delegate such of its powers and functions under the Act (except the powers to make regulations under Section 85), as it may deem necessary, to any member, officer of the Authority or any other person subject to such conditions as may be specified in the order.
14. Looking to the plain and simple language of Section 81, it cannot be said that the power of delegation conferred upon the Authority to adjudicate on a complaint and execute its order provided under Sections 35 to 40, in discharge of its functions under Clauses (f) and (g) of Section 34, is restricted in any manner. There is no exclusion or prohibition except to delegate the power to make regulations.
Section 85 confers power on the Authority to make regulations, consistent with the Act and the rule made thereunder, to carry out the purposes of the Act. Clause (i) of Section 85 (2) says that the Authority may make regulations on any other matter which is required to be specified by regulations, or in respect of which provision is to be made by regulations.
Section 29 of the Act, 2016 states that the Authority shall follow such rule of procedure at its meetings in regard to the transaction of its business, as may be specified by the regulations, made by the Authority.
15. It can, thus, be seen that the Authority has been given ample powers to formulate such rules of procedure, as it may require in regard to the transaction of its business, by making regulations providing the same and it shall follow such rules of procedure at its meetings. There is no mandate of the Act for collective decision of members of the Authority on any matter.
16. A reading of the regulations 18 to 22 of the Regulations, 2019 shows that the quorum (of three) for the meetings of the Authority and the provision for transaction of its business by majority of the votes of the members in such meeting, is applicable to the meetings of the Authority for performing functions other than the adjudicatory functions of the Authority. For conducting adjudicatory proceedings with respect to the complaints filed with the Authority, the rules of procedure have been made under Clause 24 of the regulations as under:-
"Adjudication proceedings:- 24. (a) For adjudication proceedings with respect to complaints filed with the Authority, the Authority may, by order, direct that specific matters or issues be heard and decided by a single bench of either the Chairperson or any Member of the Authority.
(b) The Authority, is consultation with the state government, will appoint Adjudicating Officers on the Panel of U.P. RERA for the purposes of adjudicating the matters of compensation admissible under the Act.
(c) The aggrieved persons will be required to file complaints before the Authority online in form - M. The claims of compensation will also be included in form - M itself. While the Authority will decide all the questions of breaches of the Act, Rules and Regulations, it will refer the question relating to the adjudication of compensation to one of the Adjudicating Officers on the Panel of U.P. RERA who will then decide the matter expeditiously and preferably within 60 days.
(d) The Adjudicating Officers on the Panel of U.P. RERA will hold their courts at Lucknow or Gautam Buddhnagar as decided by the Chairman. The complaints relating to the districts of NCR will be heard at Gautam Buddhnagar whereas complaints from the remaining districts of the State will be heard at Lucknow."
Even otherwise, there is no challenge here either to the resolutions passed by the Authority in the year 2018 for delegation of its power to a Single Member of the Authority under Section 81 of the Act or to the regulation 24 of the Regulations, 2019 framed by the Authority in exercise of its power under Section 85 of the Act.
17. The constitution of the Authority as prescribed in Section 21 of the Act is for the establishment of an Authority as a body corporate under Section 20 of the Act for discharge of its various functions with the power to acquire, hold and dispose of property, both movable and immovable, and to contract. This provision does not restrict power of the Authority to frame regulations to formulate rules of procedure for discharge of its statutory functions or mandates that the decision of the Authority should be a collective decision.
18. From a comprehensive reading of the Act and the regulations made thereunder, it cannot be said that the Authority established by the State Government as a body in the name of Real Estate Regulatory Authority (RERA) cannot delegate its power or frame regulations to carry out various objects and purposes of the Act, one of which is for providing mechanism for speedy dispute redressal by disposal of the complaints. Section 21 of the Act cannot be read in the manner as has been read by the learned counsel for the petitioners.
Further, the Act does not provide for benches of the Authority for discharge of its adjudicatory functions in the manner in which it provides for benches of the Appellate Tribunal under Section 43(3) of the Act. The difference is that the adjudicatory function is only one of the functions of the Authority in exercise of its powers to ensure compliance of the obligations under the Act whereas Appellate Authority discharges only adjudicatory function of hearing appeals from the decisions of the Authority or the adjudicating officer.
19. Ample power has been given in the Act to the Authority to formulate the rules of procedure, in regard to the transaction of its business, in discharge of its functions in exercise of powers conferred on it under the Act. The power to delegate and the power to make regulations both have been given to the Authority so as to enable it to carry out the purposes of the Act. The decision of the Authority to delegate and the regulations framed by it to create benches for early disposal of the complaints, can not be said to be inconsistent with the Act.
20. For the above discussions, the orders passed by the Single Member of the Real Estate Regulatory Authority, subject matter of challenge in this bunch, cannot be said to suffer from lack of jurisdiction.
21. As far as the view expressed by the Division Bench of the Punjab and Haryana High Court is concerned, on appreciation of the legal provisions, the said view cannot be accepted. With due regards to the learned Judges holding the bench, it may be noted that certain relevant provisions of the RERA Act have escaped their attention.
Even otherwise, as noted above, there is no challenge to the provisions of the Regulations, 2019 framed by the Authority (UPRERA) in the instant case.
For the aforesaid, the writ petitions are found devoid of merits and hence dismissed.