SC holds the Banks accountable under RERA and treats the rights of Allottees as paramount to the rights of Banks
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- Last Updated on 18 February, 2022
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[2022] 135 taxmann.com 232 (Article)
While settling one of the unanswered legal propositions, the Hon’ble Supreme Court vide its order dated 14.02.2022 has finally concluded that the Banking Institutions can be made a party before the RERA Authority and they are amenable to the jurisdiction of RERA Authority.
The Hon’ble Supreme Court vide its order in the case titled ‘Union Bank of India V. Rajasthan Real Estate Regulatory Authority and Ors . (SLP(C) No. 001861 – 001871/2022)’ dismissed the Special Leave Petition filed by the Union Bank of India assailing the judgment delivered by the Hon’ble Rajasthan High Court in the case of Union Bank of India v. Rajasthan Real Estate Authority & Ors., DBCWP No. _____/2021 wherein the Hon’ble High Court has laid down the law that the Banking Institutions would step into the shoes of Promoter and would be considered as ‘Assignee’ of Promoter under section 2(zk) of the RERA Act once they exercise their Security Interest over the Project building and take possession of the Project premise u/s 13(4) of the SARFAESI Act.
While upholding the landmark judgment of Rajasthan RERA authority, the Hon’ble High court has further held that the RERA act would prevail over the recovery proceedings of the Bank under the SARFAESI Act. This order of the Hon’ble Supreme Court has settled that the rights of the Allottees as paramount and their interest has been treated as superior in relation to the rights of the banking institutions.
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