Case BriefsTribunals/Commissions/Regulatory Bodies

Securities Appellate Tribunal (SAT): A Division Bench of Justice Tarun Agarwala, (Presiding Officer) and Dr C. K. G. Nair (Member), upheld the order passed by Securities and Exchange Board of India (SEBI) for rejecting the representation filed by the appellants.

SEBI passed an order in 2015 holding that “Kalpbut Real Estate Limited” was engaged in operating Collective Investment Scheme (CIS) by mobilizing funds from the public in contravention of Section 12(1B) of the Securities and Exchange Board of India Act, 1992 and consequently, in order to protect the interest of the investors in the securities market, SEBI directed the company and its directors to wind up the collective investment schemes and refund the money collected within the period of three months.

This order was challenged before the Tribunal which was disposed of on the strength of the submission made by the appellants that irrespective of the fact as to whether their scheme was CIS or not, the appellants were willing to refund the amount to the investors. On the basis of this statement, in 2017 the Tribunal permitted the appellants to make the representation setting out in details the names of the investors and quantum of the amount already refunded and the mode and the manner in which the balance amount would be refunded.

This list of payments made did not indicate the manner and the mode of repayment and consequently, SEBI directed the appellants to provide details of the manner in which the payments were to be made. Since no details were supplied, the representation of the appellants was rejected in 2019. The appellants filed an appeal to challenge this.

Tribunal was of the opinion that the list which was perused by SEBI only had the date and the amount mentioned in it. There were no details as to how that amount was to be paid, viz, by way of cash or by cheque or by RTGS, etc., was not indicated. Specific details were asked by SEBI, but the same was not done. Thus, the list came into scrutiny. Further, nothing was indicated with regard to the mode and the manner in which the balance amount would be refunded.

Therefore, the Tribunal held that the representation filed by the appellants was rightly rejected and that there was no error of law made by SEBI in rejecting the same.[Kalpbut Real Estate Ltd. v. Securities and Exchange Board of India, 2019 SCC OnLine SAT 164, decided on 22-08-2019]

Case BriefsTribunals/Commissions/Regulatory Bodies

National Consumer Disputes Redressal Commission: Justice V.K. Jain (Presiding Member), allowed a consumer complaint seeking a refund of money paid to book a residential flat in a construction project being carried out by the developer. 

Complainant herein had booked a residential flat in a project started by the opposite party (OP) by paying a booking amount of approximately Rs 1 crore. As per the allotment letter dated 20-02-2015, possession of flat was to be delivered to the complainant by March 2015; though an additional grace period of six months was available to the OP which could be invoked in case the possession was delayed due to unforeseen circumstances. However, the complainant was not given the possession even after almost 3.5 years.

The OP resisted this complaint on the ground that the delivery of possession got delayed as land on which project was to be developed was acquired by Yamuna Expressway Industrial Development Authority (YEIDA), and the said acquisition was challenged by landowners in Allahabad High Court. Further, the National Green Tribunal had prohibited the use of groundwater for construction purpose. Also, the supply of raw material and labour was disrupted due to strikes/agitation by the farmers whose land was acquired.

The Commission noted that the aforestated contentions had already been considered and rejected by it in its order dated 16-04-2019 in STUC Awasiya Grahak Kalyaan Association v. Supertech Ltd. (CC No. 2335 of 2017). In that case, this Commission had clearly held that it was for the OP to arrange water for construction purposes from alternative sources. Further, the land acquisition challenge had been decided by Allahabad High Court in October, 2011 itself and while the Supreme Court did uphold the said High Court’s judgment in appeal, no order was passed restraining builders (particularly the builders in YEIDA) from raising construction on the land. Moreover, the agreements with the complainant had been executed much later than the Allahabad High Court’s decision. Lastly, no direct evidence had been led by the OP to prove the dates on which farmers had actually prevented the construction work.

It was noted that the completed drawings were submitted by the OP on 15-02-2015 itself, which meant that the construction had been completed by that date but the requisite Completion Certificate/Occupancy Certificate had still not been issued.

Reliance was placed on the judgment in Pioneer Urban Land & Infrastructure Ltd. v. Govindan Raghavan, 2019 SCC OnLine SC 458 where it was held that complainants cannot be made to suffer and wait indefinitely for possession of the flat allotted to him, and is entitled to seek refund of the amount paid by him, along with compensation.

In view of the above, the complaint was allowed and OP was directed to refund the entire amount received from complainant, and also compensate them in the form of simple interest of 10 percent per annum from the date of each payment to the date of refund. OP was also directed to pay litigation costs of Rs 25,000 to the complainant.[Ajai Kumar v. Supertech Ltd., 2019 SCC OnLine NCDRC 63, Order dated 22-04-2019]

Case BriefsHigh Courts

Delhi High Court: A Single Judge Bench comprising of C. Hari Shankar, J. dismissed a review petition filed on the grounds of challenging maintainability of the original writ petition.

The review petitioner sought review of the judgment passed earlier by the same bench of the Delhi High Court. He submitted that the original writ petition was not maintainable as it was barred by period of limitation and also because no writ petition would lie for such a relief as claimed by the original writ petitioner, i.e. seeking refund of bond money.

The High Court, after considering the submissions made by the review petitioner, was of the view that the instant review petition was without merits. It was observed that there is no period of limitation for filing a writ petition. As to the second aspect also, the Court observed that there is no bar to a Writ Court entertaining a claim for refund of money. In such a view of the matter, the review petition was dismissed. [Hemant Tyagi v. UCO Bank,2018 SCC OnLine Del 12444, decided on 13-11-2018]