Complaint No. CC006000000354492


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BEFORE THE MAHARASHTRA REAL ESTATE REGULATORY AUTHORITY
MUMBAI

Complaint No. CC006000000354492


Mrs Babita B Sahu


... Complainant/s

Versus

Rare Townships Pvt Ltd


... Respondent/s


MahaRERA Project Registration No. P51800000756


Coram: Shri. Mahesh Pathak, Hon’ble Member – I/MahaRERA

Ld. Adv. Godfrey Pimenta appeared for the complainant.
Ld. Adv. Sana Khan appeared for the respondent.


INTERIM ORDER


(Thursday, 08th August,2024)

(Through Video Conferencing)


1. The complainant above named has filed an online complaint before the
MahaRERA on 24-02-2023 mainly seeking directions from MahaRERA to
direct the respondent to handover possession, interest for delay, compensation
for mental agony and costs under the provisions of the Real Estate (Regulation
& Development) Act, 2016 (from now on referred to as ‘RERA’) in respect of
the flat No.1705 on the 17th Floor, admeasuring 79.65 sq. meters (hereinafter
referred to as ‘said flat’) in the respondent's registered project known as
“Atlanta Heights (A3) - 15th to 18th Floor” bearing MahaRERA registration
no.
P51800000756,
located
at
Village
Ghatkopar East, Village Kurla Dist. Mumbai Suburban.

2. This complaint was heard on several occasions and the same was finally heard


Complaint No. CC006000000354492


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on 24-04-2024 as per the Standard Operating Procedure dated 12-06-2020
issued by MahaRERA for hearing of complaints through Video Conferencing.
Both the parties have been issued prior intimation of this hearing and were
also informed to file their written arguments, reply & and rejoinder, if any.
Accordingly, both the parties appeared as per their appearances recorded in
the roznama and made their respective submissions. The MahaRERA heard
the submissions of the parties based on their appearances and also perused the
available records.

3. After hearing both the parties, the following Roznama was recorded in the
complaint-
On 17-01-2024” Both the parties are present. The respondent has raised the
issue of maintainability of this complaint in the previous hearing and has
filed an application to that effect in December 2023. The complainant has
replied to the said issue of maintainability yesterday. Therefore, the
respondent seeks time to file its rejoinder. Therefore, 3 weeks time i.e. till 07-
02-2024 is granted to the respondent to file the rejoinder if any and written
arguments on the issue of maintainability of this complaint. Further 3 weeks’
time i.e. till 28-02-2024 is granted to the complainant to file sur-rejoinder if
any and written arguments on the issue of maintainability of this complaint.
The matter is adjourned to a suitable date after 28-02-2024 for final arguments
on the issue of maintainability of this complaint on the preliminary issue
raised by the respondent. List the matter for next hearing on 24-04-2024.”

On 24-04-2024 “Both the parties are present. The matter was kept today for
arguments on the issue of maintainability of this complaint specifically
because of the arbitration clause in the agreement for sale. Accordingly, the
complainant - allottee has filed his reply to the said application and the
respondent has filed a rejoinder to the said reply. The respondent has argued


Complaint No. CC006000000354492


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that as per clause 58 of the agreement for sale, the arbitration would be
applicable in case of dispute between the parties and there are prior orders of
the MahaRERA to that effect. Although the said orders are under challenge
before the Hon’ble Appellate Tribunal, there is neither a stay nor any finality
to the said issue. Further, the respondent has pointed out that the case laws
quoted by the complainant are easily distinguishable and the clauses of the
agreements for sale have to be read along with the provisions of the RERA.
Even though the complainant points out that the respondent opted for
conciliation, the said alternate mechanism for dispute resolution has been
mentioned in clause 57 of the agreement for sale. Further, the respondent has
pointed out that although the RERA is a special legislation and even the
Arbitration Act is a special legislation, as per section 88 of the RERA, the Act
has to be read as an addition to the provisions of the other Acts. The
complainant has refuted these contentions of the respondent and has pointed
out to the recent order of the Hon’ble Appellate Tribunal dated 31-03-2024
passed in Appeal No. AT006000000052320 (Rahul Pagaria and Ors. V/s.
Rashmi Realty Builders Private Limited and Ors.) wherein in spite of such
clause, it has been held that the RERA has jurisdiction because such clauses
are one sided as the arbitrator is to be chosen by the respondent - promoter.
Further, the complainant has pointed out to section 89 of the RERA and also
to an order of the Hon’ble Appellate Tribunal in Mantri Dwelling case wherein
it has been held that the RERA would prevail even if there is an arbitration
clause in the agreement for sale. The complainant also points out that
although the respondent has opted for conciliation, it was not an independent
conciliation but the conciliation before the MahaRERA Conciliation Forum.
Therefore, the respondent cannot take different stands and pick and choose. In
view of the above, the complainant may file written arguments within a
period of one week i.e. by 01-05-2024 along with case law. Further one week’s
time i.e. till 08-05-2024 is granted to the respondent to file its written


Complaint No. CC006000000354492


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arguments along with the case law. This matter is accordingly reserved for
order on the issue of maintainability of this complaint suitably after 08-05-
2024 based on the arguments of both the sides as well as the reply, rejoinder
and written arguments filed in the complaint and the case laws uploaded by
the parties. The future course of action in this complaint would be decided
once such an order is issued.”

4. However, despite specific directions being issued in the hearing held on 24-04-
2024, both parties failed to upload any document/s after the hearing date i.e.
on 24-04-2024. Hence, the MahaRERA has perused the available record.

5. It is a case of the complainant that the complainant purchased the said flat in
the respondent’s registered project vide registered agreement for sale dated
23-06-2015 for the total consideration of Rs.1,62,57,855/- out of which the
complainant paid an amount of Rs.86,82,744/- towards the said flat. As per the
agreement for sale, the respondent was supposed to provide the possession on
31-12-2018. However, till date, the respondent failed to complete the
construction of the said project. Further, she stated that she has availed
subvention scheme where the respondent has agreed to bear the interest
burden on the loan facilities availed by the complainant from PNB Housing
Finance Ltd. till the date of handing over of the possession of the flat.
Nevertheless, the respondent has already issued two credit notes to the
complainant aggregating to Rs.11,28,242/- for a period up to June 2017.
Despite the respondent agreeing to reimburse pre-EMI interest to the
complainant, the respondent has failed and neglected to reimburse an amount
of pre-EMI interest paid by the complainant from July 2017 till date. The
complainant took much follow-up for the possession of the said flat. However,
the same was ignored by the respondent nor the possession was provided.


Complaint No. CC006000000354492


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Further, she alleged that the respondent as the promoters of the said project
has intentionally failed and neglected to adhere to the various promises in
terms of the possession date of the flat sold to the complainant. Hence, being
aggrieved by the said action on the part of the respondents the complainant
prayed to direct the respondent to handover possession, interest for delay,
compensation for mental agony, and costs of the present proceeding.

6. The respondent uploaded its Miscellaneous Application (MA)on the record of
MahaRERA on 29-12-2023. The respondent has repeated the basic facts which
were already submitted by the complainant in her complaint copy. The
respondent stated that in the hearing on 11-10-2023, the respondent objected
to the maintainability of the present complaint. Thereafter, it stated that clause
58 of the agreement for sale stipulates that in the present case, the matter has
been disputed the same should be settled through mediation failing which it
would be by arbitration. Hence, the respondent raised the issue of lack of
jurisdiction. Further, it pointed out that the agreement for sale was executed
on 23-06-2015. Hence, the agreement for sale was executed before the
commencement of RERA. Hence the clause incorporated in the agreement for
sale cannot be rewritten. Furthermore, it stated that the date of completion
along with other terms and conditions mentioned in the said agreement for
sale remains sacrosanct. Further, it relied on the orders passed by MahaRERA
on 10-08-2022 in the
complaint no. CC006000000197166
of Madhuri Rungta &
Anr.
V/s.
Rare
Township
Pvt.
Ltd.
as
well
as

complaint
no.CC006000000194835
Ayyaz Khan and Anr. V/S. Era Realtors Pvt. Ltd. &
Ors. Thereafter, it prayed for the dismissal of the present complaint along with
the costs as the complaint is not maintainable. Hence, the present complaint
is premature and shall be bound by the arbitration clause.


Complaint No. CC006000000354492


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7. The complainant has uploaded her reply to the said MA filed by the
respondent on the record of MahaRERA on 16-01-2024, wherein the
complainant has denied each and every contention of the respondent. She
further stated that the respondent has not raised any substantial defence and
triable issues, which deserve the consideration by the MahaRERA. She further
stated that the respondent cannot pick and choose the forum as per its liking
which amounts to unfair practice under section 7 (c) of the RERA. However,
as per the declaration dated 12-07-2017 filled by the respondent it has stated
that the project registered with MahaRERA shall conform with the provisions
of the RERA. To support her contention, the complainant relied on the order
dated 27-10-2021 passed by the Ld. Erstwhile Member-1/MahaRERA in

Complaint No. CC0060000000192768
filed by one Mahek Amit Phulwani.

8. The complainant also relied on the order dated 11-07-2019 passed by the
Hon’ble Appellate Tribunal in Appeal No.00600000000792 filed by Mantri
Dwellings Pvt. Ltd. Vs Rajesh Saxena & Ors. In para-12 of the said order it is
held that :
“As per clause 60 of the agreements for sale the disputes regarding
the performance of respective obligations of the parties shall have
to be adjudicated in Civil Courts at Pune. Clause 59 of agreements
for sale regarding arbitration pertains to dispute or difference with
regard to any matters relating to or connected with the agreement,
and not relating to obligations of the parties. The RER Act 2016 is a
special Act. lt is having over ridding effect on the other Acts as per
Section 89 of the RER Act 2016. Allottees have filed complaints
under Section 31 of the RER Act 2016 for refund of the amount with
interest including compensation. Arbitration clause in agreement
for sale does not debar the Allottees from agitating their statutory
right for refund along with interest as provided under Section 18 of


Complaint No. CC006000000354492


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the RER Act 2016. lt cannot be said that complaints filed by
Allottees under the RER Act 2016 are not maintainable in view of
arbitration clause in the agreements for sale.”

9. The complainant also relied on the

JUDGMENT

passed by the Hon’ble Supreme
Court of India in Bikram Chatterji & Ors Vs. UOI, Amrapali in Para-137 inter-
alia held that RERA is a special Act and that certain rights have been created
in favour of the buyers. However, the provisions of RERA have to prevail over
the other laws. The complainant further relied on the Hon’ble Supreme Court


JUDGMENT

dated 10-12-2018 in Emmar MGF Land Ltd vs Aftab Singh [Review
Petition (C) No.2629-2630 of 2020] which is equally applicable to the present
situation based on the principle of the decision that the RERA will prevail over
the Arbitration Act. However, as she has chosen the option of filing a
complaint before MahaRERA under Section 31 of RERA, therefore, respondent
is not entitled to dispute the jurisdiction of MahaRERA, particularly after
registering the project with MahaRERA. Notwithstanding the respondent was
misleading the MahaRERA, intending to delay the whole process by filing
frivolous objections which are untenable in law. Furthermore, she submitted
that even after the passing of the order dated 14-02-2022, in the matter of Ayyaz
Khan’s case, the MahaRERA has taken on record consent terms in the case of
CC006000000195755 vide order dated 20-07-2022, thereby the conduct of
respondent suggests that it has accepted the jurisdiction of MahaRERA.

10. The complainant submitted that the Hon’ble Supreme Court in the case of
Yakub Abdul Razak Memon (supra) held that the Court again had to consider
the conflict between the general statute and the special statute. Hence, the
RERA being a special enactment dealing with the real estate sector will prevail
over the Arbitration and Conciliation Act, of 1996, which essentially deals with


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disputes of a commercial nature. Further, she stated that the present complaint
is maintainable in nature and objection on the above counts is devoid of merits.
Hence, she prayed for the dismissal of the MA filed by the respondent.

11. The respondent has uploaded its rejoinder on the record of MahaRERA on 03-
02-2024 denying every contention of the complainant which was made by her
in reply. The respondent repeated the same facts which were already
mentioned by the respondent in its MA. It has further stated that it had
reserved its rights to initiate separate civil and criminal proceedings against
the complainant for such derogatory and defamatory allegation. However, the
respondent has been acting in a bonafide manner so far and will continue to
do so. Further, it has stated that in the
Complaint No. CC0060000000192768

(Mahek Amit Phulwani), the matter was disposed of as settled before the
MahaRERA Conciliation Forum. It has also relied on the

JUDGMENT

passed by
the Newtech Promoters and Developers Pvt Ltd. v/s. State of Uttar Pradesh
on 11-11-2021. The respondent further stated that in the order dated 10-12-
2018 passed in the matter between Emmar MGF Land Ltd. v/s. Aftab Singh, it
was apparent that the said order talks about the applicability of the Arbitration
and Conciliation Act, 1996 over the Consumer Protection Act. It is further
submitted that section 88 of the RERA states that the provisions of the Act are
in addition to and not in derogation of any other laws in force. Nevertheless,
section 8 of the Arbitration and Conciliation Act. 1996 provides for the power
of judicial authority to refer parties to arbitration where there is a valid
arbitration agreement. However, in the present case, the complainant has
signed the agreement for sale and agreed to all the terms and conditions on
her own. Hence, the complainant failed to consider the Arbitration and
Conciliation Act. 1996. Further, it relied on the

JUDGMENT

passed by the
Supreme Court on 26-12-2019 in the matter of Perkins Eastman Architects DPC


Complaint No. CC006000000354492


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And Anr. V/s. HSCC (India) Ltd. Moreover, the respondent prayed to
appreciate the arbitration clause stipulated in the agreement for sale and
prayed for the dismissal of the complaint as it is not maintainable.

12. The MahaRERA has examined the rival submissions made by both the parties
and also perused the available record. In the present case, the complainant
who is an allottee of this captioned project by filing this complaint has
approached the MahaRERA mainly seeking reliefs under section 18 of the
RERA towards possession of the flat along with interest and compensation on
account of delay in handing over possession of the said flat to her on the agreed
date of possession mentioned in the registered agreement for sale signed with
the respondent promoter. The complainant has agitated the said claim by
virtue of the registered agreement for sale dated 23-06-2015.

13. The respondent promoter has assailed the aforesaid claim of the complainant
by raising the preliminary issue of maintainability of this complaint by filing a
Miscellaneous Application (MA) on record of MahaRERA mainly on the
ground that the parties herein should invoke the arbitration clause as
mentioned in the said agreement for sale dated 23-06-2015 in case of any
dispute. Hence, the present complaint is not maintainable under the
provisions of the RERA.

14. In view of the above, before dealing with this complaint on merits, the
MahaRERA has to decide the said MA filed by the respondent raising an issue
of maintainability of this complaint under the provisions of the RERA being a
preliminary issue.

15. In the present case, in reply to the said issue of maintainability of this
complaint in view of arbitration clause mentioned in the said agreement for


Complaint No. CC006000000354492


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sale dated 23-06-2015, the complainant has mainly contended that there are
case laws of the Hon’ble Appellate Tribunal, Hon’ble Bombay High Court as
well as Hon’ble Supreme Court regarding the arbitration clause mentioned in
the said agreement for sale. They further contended that although the said
clause was very much mentioned in the said agreement for sale, since this
project is registered with the MahaRERA, the present complaint is
maintainable under RERA. She further contended that as per the provisions of
section 89 of the RERA, the provisions of the RERA will prevail over the other
statutes. Hence, the complainant prayed for dismissal of the said M.A.

16. The respondent has refuted all these aforesaid contentions of the complainant
mainly on the ground that as provided under section 88 of the RERA, the
provisions of the RERA shall be in addition to and not in derogation of, the
provisions of any other prevailing law. Hence, it has contended that the
provisions of section 8 of the Arbitration and Conciliation Act, 1996 are
applicable to the present case. It has also contended that the judgements relied
upon by the complainant in support of her claim has no relevance in the present
case.

17. From the aforesaid submissions made by both the parties on the issue
maintainability of this complaint in view of the arbitration clause mentioned
in the said agreement for sale, the MahaRERA prima facie feels that, before
dealing with the substantive issue of possession along with interest and
compensation sought by the complainant herein, the MahaRERA has to decide
the MA filed by the respondent. Admittedly, the same pertains to the
maintainability of this complaint under the provisions of the RERA in view of
the arbitration clause mentioned in the said agreement for sale dated 23-06-

2015. Complaint No. CC006000000354492


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18. Be that as it may, as far as the said issue of arbitration clause, the MahaRERA
has
noticed
that
the
very
first
order
passed
by
the
Hon’ble
Chairperson/MahaRERA dated 14-01-2022 was passed in the matter of Ayyaz
Khan and Anr., wherein it was held that in view of the arbitration clause
mentioned under the agreement for sale signed under MOFA regime, the
parties need to invoke the arbitration and conciliation under the provisions of
section 8 of the Arbitration and Conciliation Act. However, the said order
dated 14-01-2022 passed by the Hon’ble Chairperson/MahaRERA has been
challenged before the Hon’ble Appellate Tribunal in Appeal No.
AT006000000053554 filed by the said complainant-allottees therein on 19-01-

2022. 19. The MahaRERA has also noticed that the said identical issue as raised by the
respondent herein seems to be pending for consideration of the Hon’ble High
Court at Bombay in Second Appel No.434 of 2023 filed by one M/s. Rashmi
Realty Builders Pvt Ltd vs Mr. Rahul Pagariya. The record also shows that in
the aforesaid Second Appeal No. 434 of 2023, the Hon’ble Bombay High Court
vide an order dated 24-07-2023 was pleased to frame the following issue :-

“Whether the jurisdiction of Real Estate Regulatory Authority established under
Section 20 of the Real Estate Regulation and Development Act, 2016 is ousted, if the
agreement between the promoter and the allottee contains arbitration clause?

20. It shows that the said crucial issue as raised by the respondent in this complaint
(although after first hearing was done in this matter and before the hearing on
this complaint on merits) about the maintainability of this complaint in view
of the specific “arbitration clause mentioned in the agreement for sale executed
under the MOFA” is under consideration before the Hon’ble Bombay High
Court in the aforesaid Second Appeal.


Complaint No. CC006000000354492


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21. Hence, any decision on the aforesaid issue of maintainability raised by the
respondent promoter would definitely amount to pre-judging the issue which
is subjudice before the Hon’ble Bombay High Court.

22. Considering these facts and in the fitness of justice, it would be just and proper
to wait for the decision of the Hon’ble Bombay High Court in pending Second
Appeal No. 434 of 2023 while taking any decision in this complaint on the
issue of maintainability. Both the parties in this complaint are directed to file
an application on record of MahaRERA once the said Second Appeal No. 434
of 2023 is decided by the Hon’ble Bombay High Court. Till then, the decision
in this complaint on the issue of maintainability is kept in abeyance.

23. With these directions, the MA filed by the respondent promoter stands
disposed of.


(Mahesh Pathak)
Member – 1/MahaRERA