PANCHMAL PROPERTIES Vs. UNION OF INDIA

JUDGEMENT

(1.) Mr.Sanjay Krishna V., learned counsel for the petitioner.

(2.) The petitioner is a promoter of mixed development real estate project for which it has obtained sanction of building plan from Bengaluru Mahanagara Palike on 09.01.2017. The petitioner commenced the project work on 07.03.2017. The provisions of Sections 2, 20 to 39, 41 to 58, 71 to 78 and 81 to 92 of the Act came into force vide a Notification dated 26.04.2016 with effect from 01.05.2016. The remaining Sections of the Act came into force by a Notification dated 19.05.2017 with effect from 01.05.2017. The respondent No.2 framed the Rules, which came in to force on 11.07.2017. Under Rule 18(8) of the Rules, the Secretary of the Housing Department was appointed as Interim Regulatory Authority. The petitioner on 09.11.2017 applied for the project. On 01.12.2017, respondent No.3 issued a memorandum by which compulsory penalty was sought to be imposed on ongoing projects in respect of the builders who failed to register themselves before 31.07.2017. Thereafter, on 05.04.2018 a show cause notice was issued to the petitioner by respondent No.3. The petitioner responded to the aforesaid show cause notice by filing a reply on 05.04.2018. However, by an order dated 11.05.2018, the respondent No.3 directed the petitioner to pay a sum of Rs.76,94,000/- as penalty. In the aforesaid obtaining factual matrix, the petitioner has visited this court seeking the reliefs as stated supra:

(3.) Learned counsel for the petitioner while inviting the attention of this court to Section 20(1) of the Act as well as Section 43(1) of the Act submitted that the aforesaid provisions prescribed that appropriate Government shall within a period of one year from the date of coming into force of this Act by Notification shall establish authorities viz., Real Estate Regulatory Authority and the Real Estate Appellate Tribunal respectively under Sections 20(1) and 43(1) of the Act. It is further submitted that the aforesaid authorities were required to be established from the period from 01.05.2016 till 30.04.2017. However, in the month of May 2017, the Rules have been enacted and under the Rules viz., Rules 18(8) and Rule 31(9) of the Rules, the Real Estate Regulatory Authority and Real Estate Appellate Tribunal have been merely notified. It is further submitted that power to deal with violation in respect of Sections 3 and 4 of the Act lies with the authority and not the Adjudicating Officer. It is also submitted that petitioner does not have any alternative remedy as the Appellate Tribunal has not been established. It is also urged that since, the Rules have been framed beyond the period of one year and under Rules 18(8) and 31(9) the Real Estate Regulatory Authority and Real Estate Appellate Tribunal have been constituted. Therefore, the aforesaid Rules are ultra vires the provisions of Sections 20(1) and 43(1) of the Act respectively.