Bombay HC Sets Aside MahaRERA’s Order for being Non-Reasoned


January 20, 2018

The Bombay High Court in a case recently taken up by it has quashed the order passed by Maharashtra Real Estate Regulatory Authority (MahaRERA), whereby MahaRERA, Mumbai vide its order dated November 28, 2017 had refused the Petitioner’s prayer for compensation holding that the project under reference got delayed due to reasons beyond the control of the respondents.

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In the case before MahaRERA, the Complainant namely Sharan Lund and Vandana Sharan Lund had requested the Authority to give necessary directions to the respondent Builder to pay compensation with interest @ 12% p.a. against delayed possession, rental hardship and agony caused due to delayed possession of the impugned Project.

In appeal the Bombay High Court has now quashed MahaRERA’s aforesaid order stating that the order was in contravention of the principles of natural justice as it did not record any reason for passing the impugned order. Reference was also made to Section 38(2) of Real Estate (Regulation and Development) Act, 2016 which provides that the Authority shall be guided by the principles of natural justice.

The relevant extract of MahaRERA’s order is reproduced below:

“Considering the arguments advanced by both the parties and after perusing the record, this Authority feels thot the project under reference hos got delayed due to the reasons beyond the control of the respondents as stated above and the said grounds of delay ore justified grounds for delay caused in completing the project.”

MahaRERA’s order can be accessed here.

While laying emphasis on the substance of passing a reasoned order, the Bombay High Court remarked that recording of reasons discloses the mind of the deciding authority and the insight of the circumstances or other aspects which led the authority to arrive at a particular decision. The recording of reasons is obviously an aspect of natural justice and needs to be adhered to. The order that ought to be passed by the authority shall be in compliance with statutory requirements of Section 38(2) of the Act of 2016.

The Bombay High Court has directed the MahaRERA to reconsider the Petitioner’s complaint and to decide the matter preferably within three months.

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