Madras High Court
Emerald Haven Realty vs ) S.V.Ramesh on 24 January, 2025
Author: J.Nisha Banu
Bench: J.Nisha Banu
C.M.S.A.No.55 of 2024
IN THE HIGH COURT OF JUDICATURE AT MADRAS
RESERVED ON : 10.12.2024
PRONOUNCED ON : 24.01.2025
CORAM:
THE HON'BLE MRS. JUSTICE J.NISHA BANU
AND
THE HON'BLE MR. JUSTICE R.SAKTHIVEL
C.M.S.A.No.55 of 2024
and C.M.P.Nos.18241, 18242 & 18245 of 2024
Emerald Haven Realty
Developers (Paraniputhur) Pvt.Ltd.,
Rep. By its Managing Director,
1st Floor, Greenways Towers,
No.119, St.Mary's Road,
Abhiramapuram, Chennai 600 018 ... Appellant
-vs-
1) S.V.Ramesh
2) The Principal Commissioner
of GST & Central Excise,
Chennai North, GST Bhawan,
26/1, Mahatma Gandhi Road,
Nungambakkam, Chennai 600 034 ... Respondents
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C.M.S.A.No.55 of 2024
* R2 impleaded vide Court Order dated 04.09.2024 made in C.M.P.No.19574/2024.
PRAYER: Civil Miscellaneous Second Appeal filed under Section 58 of the
TNRERA Act, 2017 r/w section 100 of Civil Procedure Code, 1908, against
the judgment of the Tamil Nadu Real Estate Appellate Tribunal ('Tribunal'),
Chennai dated 07.08.2024 passed in Appeal No.18 of 2024 ('impugned
judgment') confirming the judgment passed by the Tamil Nadu Real Estate
Regulatory Authority, Chennai dated 26.04.2023 in C.C.P.No.233 of 2021.
For Appellant : Mr.Satish Parasaran,
Senior Counsel for Mr.Rahul Balaji
For R-1 : Mr.Devaraj
For R-2 : Mr.Siddharath Bhandari
******
JUDGMENT
(Judgment of this Court made by J.Nisha Banu, J.)
The appellant has approached this Court under Section 58 of the Real
Estate (Regulation and Development) Act, read with Section 100 of the Civil
Procedure Code against the judgment of the Tamil Nadu Real Estate
Appellate Tribunal, Chennai dated 07.08.2024 passed in Appeal No.18 of
2024, confirming the judgment passed by the Tamil Nadu Real Estate
Regulatory Authority, Chennai dated 26.04.2023 in C.C.P.No.233 of 2021.
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2. The essential facts of the case would run thus:-
2.1. A flat bearing No.B-102, with undivided share of land measuring
1203 sq.ft and having carpet area of 1236 sq.ft., type 4 BHK 3T in the first
floor, Block B, along with a balcony area of 101 square feet, in the
residential cum commercial building complex known as TVS Emerald
“Green Enclave” project was originally booked by the father of the first
respondent for a base price of Rs.1,03,74,276/- i.e. Rs.17,98,485/- being the
land cost and Rs.85,75,791/- being the civil construction cost. Pursuant to the
same, construction agreements and sale agreements were entered into by and
between the parties on 10.02.2020 and the expected delivery of the apartment
was fixed during the month of October 2023.
2.2. Subsequently, the father of the first respondent has paid a sum of
Rs.47,08,604/- to the appellant/Promoter towards the amount payable for the
purchase of the flat. All of a sudden, the first respondent's father died on
05.09.2020, due to illness which ultimately resulted in huge medical
expenses on the side of the first respondent. After the sudden demise of the
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first respondent's father, his mother decided to settle in Kerala itself and
owing to reduction of 50% of salary of the first respondent due to COVID
pandemic, the first respondent decided not to purchase the subject flat.
Therefore, the first respondent sent an email dated 24.11.2020 to the
appellant/Promoter requesting to sort out the issue raised by him.
2.3. In this regard, the appellant/Promoter has suggested the first
respondent that instead of cancelling the 4 BHK flat, the first respondent
shall prefer to purchase a 2 BHK flat, so that, the first respondent can save
the cancellation fees, which is 10% of the total consideration, which has been
already mentioned under the terms of the unregistered construction
agreement. Therefore, the first respondent decided to swap the 4BHK
apartment with a 2BHK apartment for a total consideration of Rs.59,50,821/-,
wherein the appellant/Promoter's representatives have assured the first
respondent that one reserved car parking will be part and parcel of the 2BHK
flat. On 20.01.2021, the appellant/Promoter sent a letter to the first
respondent, to confirm the provisional allotment of flat No.D-103 to the first
respondent.
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2.4. Meanwhile, after 20.01.2021, one Ms.Gayathri, staff of the
appellant/Promoter's firm, visited the residence of the brother of the first
respondent, who is the Power Agent of the first respondent and the new
agreements, allotment letter, payment demand letter of newly allotted Unit D
103 along with Cancellation Agreement dated 19.01.2021 with respect to B-
102 were handed over on 20.01.2021. In return, she has taken the
unregistered original Construction and Sale Agreements dated 27.01.2020
with respect to B-102 and did not return the authorized copy of the signed
cancellation agreement. When the same was questioned by the first
respondent, he was informed that the same would be given to him, when the
first respondent signs the unregistered Sale and Construction Agreements
with respect to the newly allotted flat D 103.
2.5. Later when the first respondent perused the draft sale and
construction agreements for flat D103, he realized that contrary to the
discussion had with the appellant/Promoter's representatives at the time of
swapping of the flats, the newly allotted flat D 103 did not have reserved
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covered car parking. Therefore, the first respondent did not agree with the
terms of the Construction agreement and did not sign the agreements for D
103 and vide email dated 28.02.2021, the first respondent has informed the
appellant/ Promoter that he was not interested in purchasing the 2 BHK flat,
if he is not provided with covered car parking. But then, there was no
effective remedy provided from the side of the appellant/ Promoter to address
the grievance of the first respondent. Again on 27.04.2021, the first
respondent had sent an email to the appellant/ Promoter stating that he is not
satisfied with the appellant/ Promoter's service and therefore, he is not
interested in purchasing the 2 BHK flat and further requested for immediate
return of his money paid in respect of Flat B 102.
2.6. In reply to the aforesaid email of the first respondent, the
appellant/ Promoter sent an email dated 30.04.2021 stating that the first
respondent shall have the choice of either swapping the flats (4BHk with
2BHK) and choose from the available units in 2 or 2.5 BHK or if not, he can
continue with Flat No.B 102 or if he still prefers to withdraw from Flat No.B
102, then there will be 10% deduction charges as per the Agreement Clause.
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Again, the first respondent, vide email dated 01.05.2021 informed the
appellant/ Promoter that the options given by the appellant/ Promoter are
totally unacceptable. Despite covered car parking facilities being provided
for certain 2 BHK flats, the appellant/ Promoter has deliberately
misinterpreted that there were no covered car parking for 2 BHK and if the
first respondent wanted a covered car parking, then he has to opt for 2.5
BHK or larger flats. Subsequently, on 08.05.2021, the appellant/ Promoter
sent an email to the first respondent persuading him to opt for 2.5 BHK or
larger flats for availing covered car parking facility and immediately, on the
very same day, i.e. on 08.05.2021, the first respondent has informed the
appellant/ Promoter that he is not interested in buying any flat in the
appellant/ Promoter's project.
2.7. On 10.05.2021, the appellant/ Promoter sent an email to the first
respondent requesting for the confirmation of cancellation charges and GST
Loss, resulting in a total deduction of Rs.21,77,803/- and has further stated
that upon confirmation of the same, payment will be processed within 30
days time. Aggrieved against the same, the first respondent sent a lawyer's
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notice dated 21.05.2021 to the appellant/ Promoter to refund the principal
amount of Rs.47,08,604/- along with interest and compensation. In reply to
to the same, the appellant/ Promoter on 26.06.2021 stated that as per the
provisions of RERA, the appellant/ Promoter shall have the right to deduct
the booking amount towards registrations and claims of the complainant, if
cancellation charges are refuted on baseless grounds. Moreover, the
deduction of GST loss for a sum of Rs.11,40,376/- cannot be permitted when
the possession is not handed over and when construction of the said flats is
under process. Thereafter, on 28.07.2021, an email was sent from the side of
the appellant / Promoter intimating to collect the final refund payment of
Rs.25,30,801/- thereby attaching a copy of the scanned cheque No.872349
dated 27.07.2021 drawn on State Bank of India issued by the appellant/
Promoter, after deducting the cancellation charges and the GST loss.
2.8. Aggrieved against the above actions of the appellant/ Promoter,
the 1st respondent filed a complaint in CCP No.233 of 2021 before the
Tamil Nadu Real Estate Regulatory Authority, Chennai on 04.08.2021.
Thereafter, on 06.08.2021, the power agent of the first respondent, who is the
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brother of the first respondent received a notice from the appellant / Promoter
along with original cheque dated 27.07.2021 bearing No.872349 drawn on
State Bank of India for a sum of Rs.25,30,801/- in favour of the first
respondent. Without prejudice to his rights, the first respondent received the
above said amount, which is part payment of his claim amount. The Tamil
Nadu Real Estate Regulatory Authority, Chennai, vide order dated
26.04.2023 partly allowed the complaint filed by the first respondent, by
awarding refund of an amount of Rs.11,40,376/- with interest pertaining to
GST and in so far as 10% cancellation charges are concerned, the TNRERA
held the same in favour of the appellant / Promoter by stating that the first
respondent was terminating the Agreement and cancelling the allotment for
personal reasons.
2.9. In this regard, both the appellant/Promoter as well as the first
respondent filed separate appeal petitions against the order of the Tamil
Nadu Real Estate Regulatory Authority, Chennai. The first respondent filed
an appeal in Appeal No.63 of 2023 challenging the cancellation charges,
which came to be dismissed at the admission stage itself. Whereas, the
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appellant / Promoter filed Appeal No.18 of 2024, challenged the order with
regard to the refund granted towards GST to the first respondent. The
Appellate Tribunal vide impugned order dated 07.08.2024 permitted the first
respondent to withdraw the entire pre-deposit amount paid by the appellant/
Promoter by holding that the appellant/ Promoter did not take steps to apply
for refund. Therefore, aggrieved against such order of the Appellate Tribunal,
the appellant/Promoter has preferred the present Civil Miscellaneous Second
Appeal before this Court.
3. Mr.Satish Parasaran, learned Senior Counsel, assisted by Mr.Rahul
Balaji, learned counsel for the appellant/ Promoter presented the following
substantial questions of law:-
(i) Whether an allottee is entitled to refund of amounts paid
towards GST from the Promoter, when cancellation of
apartment takes place after the cut-off date for issuance of a
credit note under Section 34 of the Central Goods and
Services Tax Act, 2017?
(ii) Whether a promoter has the option of applying for refund
of GST/issuance of credit note after the cut-off date mentioned
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in Section 34(2) of the Central Goods and Services Tax Act,
2017?
(iii) Whether the liability to apply for refund of GST is on the
promoter or the allottee in case of cancellation of an
apartment, considering Section 54 of the Central Goods and
Services Tax Act, 2017 read with Rule 89(2)(ka) of the
Central Goods and Services Rules, 2017?
(iv) Whether an allottee can be permitted to withdraw the pre-
deposit amount made by the Promoter before the Appellate
Tribunal under the RERA Act, 2016 when the allottee's
application for refund of GST amounts under Section 54 of the
CGST Act, 2017 is pending before the tax authorities?
(v) Whether penalty for non-registration of a sale agreement/
construction agreement can be imposed when the allottee has
not come forward for registration of the documents, which
have otherwise been relied upon and recognised?
(vi) Whether the impugned judgment dated 07.08.2024 passed
by the Hon'ble Tamil Nadu Real Estate Appellate Tribunal in
Appeal No.18 of 2024 is ex-facie contrary to the evidence on
record?
(vii) Whether the impugned judgment dated 07.08.2024
passed by the Hon'ble Tamil Nadu Real Estate Appellate
Tribunal in Appeal No.18 of 2024 has arrived at a conclusion
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without any basis i.e., a case of no evidence?
The learned Senior Counsel campaigned his views in support of the
appellant/ Promoter in the following manner:
3.1. The learned counsel for the appellant/ Promoter did not dispute the
aforesaid facts of the case. In so far as deduction of amounts already paid in
respect of GST is concerned, the GST is computed and payable by the
developer on demands raised by the developer on the customer and not based
on the receipt of payments from customers. As on the date of the Agreement,
the milestone completed was with respect to the “completion of the fourth-
floor slab” and the appellant is required to raise such demand on the
customer up to the milestone completed by the appellant/ Promoter and the
same to be reflected in the GSTR returns of the appellant/ Promoter for the
said month. In accordance with the said requirement, the appellant/ Promoter
raised demands upto the amounts in respect of the said milestone as per the
schedule to the construction agreement between the parties and the same has
also been disclosed in the GSTR-1 returns of the Appellant.
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3.2. He further submitted that the GST amount in respect of the first
respondent's apartment having already been disclosed and remitted/filed to
the Authorities concerned by the Appellant/ Promoter in February 2020, a
credit note pursuant to termination of the agreement with respect to the
apartment booked in the Financial Year 2019-2020 could be issued by the
Appellant/Promoter only till the month of September 2020 (Prior to
Amendment in 2022) as per Section 34(2) of the Central GST Act. It is to be
noted that the cancellation of the apartment was not confirmed by the first
respondent even until May 2021, in spite of several reminders from the
Appellant/Promoter. Due to the statutory time bar, the Appellant/Promoter
cannot issue a credit note for the GST on the amount paid by the first
respondent. If the cancellation had been done by the 1st respondent before
September 2020, then the Appellant/Promoter could have issued a credit note
and refunded the GST amount to the first respondent, since the output tax
liability of the Appellant/Promoter would have reduced.
3.3. It is further submitted that the above said issue was also
recognised by the GST Council in its 48th Meeting, dated 17.12.2022,
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wherein the issue of refund of GST to buyers, who cancel their apartments
when the construction is in progress has been discussed as thus:
"Measures for Facilitation of Trade:
2. Refund to Unregistered Persons: There is no procedure
for claim of refund of tax borne by the unregistered buyers
in cases where the contract/ agreement for supply of
services, like construction of flat/house and long-term
insurance policy, is cancelled and the time period of
issuance of credit note by the concerned supplier is over.
The Council recommended amendment in CGST Rules,
2017, along with issuance of a circular, to prescribe the
procedure for filing application of refund by the
unregistered buyers in such cases."
3.4. The learned Senior counsel further submitted that even for the
subsequent sale of the same apartment, the Appellant/ Promoter is required to
remit/file the GST amounts/returns since service is being provided by the
Appellant/ Promoter to the new buyer and an invoice is being issued in the
name of the new buyer. Under the GST law, under such circumstances, no
refund or adjustment is permitted to the Appellant/ Promoter. Therefore, the
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Appellant/ Promoter was entitled to deduct the amounts towards GST since
the Appellant/ Promoter had remitted the GST amounts both the times and
has not retained any part of it with itself, and is also unable to presently
obtain a refund of the said amounts on account of the delay of confirmation
of cancellation of the flat by the 1st respondent's.
3.5. It is the further submission of the learned Senior Counsel that it is
open for the 1st respondent to approach the GST authorities for the refund of
the said amounts, which option the 1st respondent has exercised during the
pendency of the Appeal before the Tamil Nadu Real Estate Appellate
Tribunal by filing an application dated 29.07.2024 for refund of GST. As this
does not preclude the right of a recipient of service from filing an application
for refund of tax amounts on a service that has been subsequently canceled,
under Section 54 of the CGST Act, 2017, with specific reference to the same,
Rule 89(2)(ka) of the CGST Rules, 2017 provides for a mechanism of refund
of tax that a non-registered person can avail "in a case where the refund is
claimed by an unregistered person, where the agreement or contract for
supply of service has been cancelled or terminated and the time period of
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issuance of credit note by the concerned supplier is over.”
3.6. The learned Senior Counsel further drew the attention of this
Court to the Circular of the Central Board of Indirect Taxes and Customs,
Ministry of Finance in Circular No.188/20/2022-GST dated 27.12.2022
which specifically deals with a case such as the present case. The relevant
portion reads as follows:
“Instances have been brought to the notice where the
unregistered buyers, who had entered into an agreement/
contract with a builder for supply of services of
construction of flats/ building, etc. and had paid the amount
towards consideration for such service, either fully or
partially, along with applicable tax, had to get the said
contract/ agreement cancelled subsequently due to non-
completion or delay in construction activity in time or any
other reasons. In a number of such cases, the period for
issuance of credit note on account of such cancellation of
service under the provisions of section 34 of the Central
Goods and Service Tax Act, 2017 (hereinafter referred to as
'CGST Act') may already have got expired by that time. In
such cases, the supplier may refund the amount to the
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buyer, after deducting the amount of tax collected by him
from the buyer.”
3.7. The learned Senior Counsel stated that in the present case, during
the pendency of the Appeal filed by the Appellant/ Promoter, the first
respondent, pursuant to an affidavit of undertaking, filed an application as
contemplated under Section 54 of the Act read with Rule 89(2)(ka). In spite
of the opposition raised by the Appellant/ Promoter for the withdrawal of the
pre-deposit, the Appellate Tribunal dismissed the Appeal and permitted the
withdrawal of pre-deposit by the 1st respondent, which is perverse and the
same needs the interference of this Court.
3.8. He also submitted that, in respect of imposition of penalty of
Rs.1,00,000/-, the TNRERA failed to take into account the fact that the
agreements entered into in February 2020 could not be registered for the sole
reason that the impending COVID- 19 made it impossible for the agreements
to be registered, and the 1st respondent himself was not in India at the
relevant point of time.
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3.9. The learned Senior Counsel concluded his arguments by stating
that the the second respondent has made it clear before this Court that the
Appellant/ Promoter is entitled to deduct GST charges before refunding the
amounts, as the Appellant/ Promoter would not be able to file an application
for a refund/ credit note. Further it was also clarified by the second
respondent before this Court that the first respondent would be eligible to file
an application claiming for refund. He contended that the Appellate Tribunal
erred in allowing the first respondent to withdraw the deposit made by the
appellant/promoter even after the first respondent having filed the application
for refund with the Authorities, during the pendency of the appeal before the
Tribunal. Hence, the learned Senior Counsel summarized the facts that the
first respondent is only eligible for making an application for refund of GST
before the competent Authorities.
3.10. Furthermore, the learned Senior Counsel submitted that the
appellant/ Promoter never gave any consent before the Appellate Tribunal to
pay the refund amount back to the first respondent nor for the first
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respondent to withdraw the pre-deposit amount. He also filed an additional
written submission on 16.12.2024 before this Court to substantiate the above
said submission and vehemently, argued that the order passed by the
Appellate Tribunal was not a consent order. Therefore, the learned Senior
Counsel seeks the interference of this Court to the judgment of the Tamil
Nadu Real Estate Appellate Tribunal ('Tribunal'), Chennai dated 07.08.2024
passed in Appeal No.18 of 2024, thereby setting aside the same and allow
this appeal.
4. Mr.Devaraj, learned counsel appearing for the first respondent made
the following submissions:
4.1. The main contentions raised by the learned counsel is that when
the Appellant/ Promoter sent an email dated 10.05.2021 requesting the
confirmation of cancellation charges and GST Loss, the said GST loss was
added for the first time in the email, without assigning any valuable reasons
and there was also no clause pertaining to such GST deduction in the
unregistered Construction Agreement, which clearly shows the malafide
attitude of the Appellant/ Promoter.
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4.2. Even though the 1st respondent had informed his cancellation of
flat i.e on 24.11.2020, till 10.05.2021, the appellant/ Promoter had not
informed the first respondent about the deduction of GST loss. When the first
respondent sought for returning the paid money, the appellant/ Promoter has
come up with a statement that they will deduct GST loss charges
Rs.11,40,376/- from the total amount paid by the 1st respondent. According
to the learned counsel for the first respondent, the appellant/ Promoter had
sold the 4 BHK flat to another purchaser and he also paid GST towards the
same flat. Till date, the appellant/ Promoter has not produced any proof to
substantiate the fact that he has paid two times GST for the very same flat B-
102 to the 2nd respondent.
4.3. When Appeal No.18 of 2024 was filed before the Appellate
Tribunal by the appellant / Promoter, on the date of 1st hearing i.e. on
12.04.2024, the Appellate Tribunal, after hearing both sides and noticing the
order passed in Appeal No.63 of 2023 dated 11.10.2023, which was filed by
the first respondent, did not admit the appeal No.18 of 2024 and was likely to
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dismiss the same. At that time, the learned counsel appearing for the
appellant represented that as per Section 34 of the Central Goods and
Services Tax Act, 2017 and the Circular No.188/20/2022-GST issued by the
Government of India, Ministry of Finance dated 27.12.2022, the allottee has
to apply for the refund of the GST paid by the Promoter within two years
from the date of cancellation and the appellant would execute the
Cancellation Deed within a week from that day. Thereafter, when the
Appellate Tribunal asked the 1st respondent counsel about the amicable
settlement, the learned counsel submitted before the Tribunal that the 1st
respondent will apply for refund as per the new Circular issued by the 2nd
respondent but the same shall be after the withdrawal of pre deposit made by
the appellant/ Promoter before the Tribunal since it is the money of the first
respondent lying with the appellant for more than 4 years. Considering the
submission made by the learned counsel, the Appellate Tribunal ordered the
first respondent to file an undertaking affidavit to that effect.
4.4. Thereafter, on 24.04.2023, the first respondent filed an Affidavit
of undertaking dated 20.04.2024 stating that after the withdrawal of pre-
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deposit amount, he will apply for the refund of GST and will refund the said
amount immediately to the appellant. By orders dated 12.04.2024 and
24.04.2024, it clearly shows that it was upon the clear consent of the learned
counsel for the appellant that he will execute the Cancellation deed afresh for
the purpose of applying refund of GST application, since the earlier executed
cancellation deed ,dated 19.01.2021 got expired as on 24.04.2024 to apply as
for refund of GST. Therefore, for the said purpose, the Appellate Tribunal
has directed the appellant to give all relevant documents regarding GST paid
by them before the 2nd respondent and at that time, before the Appellate
Tribunal, Mr. Vishnu Mohan, learned counsel for the Appellant, undertook to
handover all the relevant documents as mentioned in Para 2.1 of the Circular
No.188/20/2022-GST dated 27.12.2022. Thereafter only the respondent had
applied the refund application through his auditor and submitted the
application before the Tribunal on 07.08.2024.
4.5. With regard to the argument of consent given by the Appellant/
promoter before the Appellate Tribunal, the learned counsel for the first
respondent submitted that if the appellant has not really given consent on
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12.04.2024 and 24.04.2024 before the Appellate Tribunal, then they should
not give a fresh cancellation agreement and all necessary documents as
agreed by the appellant / promoter on 24.04.2024. After agreeing the same
and after application filed by the 1st respondent before the 2nd respondent as
per the Undertaking, now, the learned counsel for the appellant/ Promoter has
come up with a new stand that they have not given any consent on the day of
hearing before the Appellate Tribunal.
4.6 According to the learned counsel for the first respondent, if the
Appellant/ Promoter has not given consent, then, they should have
challenged the order dated 12.04.2024 and 24.04.2024 instead challenging
impugned dismissal judgment dated 07.08.2024. But the learned counsel for
the appellant / Promoter has chosen to remain silent till 07.08.2024 and now
has challenged the same that the 1st respondent is not entitled to get the
pre-deposit amount once the refund application is pending before the 2nd
respondent. Till date, there is no proof to show that the appellant had paid
two times GST for the very same flat.
4.7. The main contention of the learned counsel for the first respondent
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is that the above circular is issued on 27.12.2022, when the Claim petition in
C.C.P No.233 of 2021 is pending before the TNRERA. Even during the
pendency of the claim petition, the appellant never raised that the circular is
issued on 27.12.2022 to get refund through allottee and not come for
amicable settlement. As per the GST Rules, the appellant/promoter has to get
refund amount within 2 years of the execution of cancellation once the
construction agreement was canceled. According to the learned counsel for
the first respondent, the appellant was squatting over this issue for more than
two years from the date of cancellation of agreement i.e on 19.01.2021 which
is in the custody of appellant which is admitted by the appellant in the email
communication and they have suppressed the real fact and giving false
information before this Court to get a favourable order.
4.8. The learned counsel for the first respondent further submitted that
as per the unregistered Construction Agreement, the appellant/Promoter is
entitled to deduct 10% of total sale consideration, which is already deducted
by them. Now the appellant/ Promoter has challenged the GST refund which
is unsustainable in law and facts and hence, prayed for dismissing the appeal.
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5. Heard the learned Senior counsel appearing for the appellant/
Promoter as well as the learned Counsel appearing for the first respondent
and the second respondent and perused the materials placed before this
Court.
6. Perusal of records would go to show that the father of the first
respondent has initially booked the apartment under the appellant/Promoter's
Project. Due to the sudden demise of his father, the first respondent has
decided to call off the proposal and also informed the appellant/ promoter,
explaining his situation through email. It was the appellant/ Promoter, who
has evinced interest in convincing the first respondent by stating that instead
of wasting 10% of the sale consideration towards cancellation charges, it
would be an apt thought for the first respondent to invest in a smaller
apartment that would cost Rs.59,50,821/-. Since the first respondent has
already paid Rs.47,08,604/- towards the earlier booked apartment, if he
cancels the same, then a cancellation charge of 10% which amounts to
Rs.10,37,427/- would be deducted from the total amount paid by the first
respondent. Therefore, the appellant/ Promoter has advised the first
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respondent to invest the remaining amount i.e. Rs.12,42,217/- that shall be
paid in order to complete the sale consideration of the newly alloted
apartment.
7. It is for the appellant / Promoter to set the record straight before the
first respondent, when he wanted to convince the first respondent on
purchasing of an alternative apartment, with the points regarding cancellation
charges as well as deduction of GST Loss. In the present case on hand, the
appellant / Promoter has been insisting the first respondent through email
regarding the deduction of 10% cancellation charges only and did not spill
the beans with regard to deduction of GST loss. It was only when the first
respondent refused to purchase any other apartment under the appellant/
promoter's Project, the appellant/ Promoter has revealed about the further
deduction of GST Loss which amounts to Rs.11,40,376/-.
8. Moreover, the primary contention raised by the learned Senior
Counsel is that the appellant / Promoter is burdened as he is made to remit
GST charges twice for the same apartment. But in order to substantiate the
above contention, there is no valid proof submitted on the side of the
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appellant/ Promoter, where the appellant has paid two times GST before the
Competent Authority for the very same apartment. As per the provisions of
Section 104 of the Bharatiya Sakshya Adhiniyam, the burden of proof lies on
the party who asserts the existence of any fact. This means that if a party
claims that a certain fact is true, it is their responsibility to provide evidence
supporting that claim. In the present case on hand, it is for the appellant/
Promoter to prove that he has paid GST two times for the same apartment
before the competent Authority, which has not been done in the present case.
9. On a perusal of the Sale and Construction Agreements entered into
between the appellant/ Promoter and the first respondent, dated 10.02.2020,
no where it has been specifically mentioned about the deduction of GST loss,
in case of cancellation of purchase made by the first respondent.
Furthermore, it is also to be taken into consideration that before the
Appellate Court, the first respondent has filed an undertaking stating that on
receipt of the GST amount received from the Department for the refund
application submitted by him, he would pay the refunded amount to the
appellant/ Promoter immediately. The Appellate Court, having been
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convinced by the said undertaking, permitted the first respondent to
withdraw the pre-deposit amount of Rs.11,40,376/- deposited by the
Appellant / Promoter, together with accrued interest and also directed the
first respondent to intimate the progress of the refund application to the
appellant/ Promoter once in two weeks.
10. In the considered opinion of this Court, the Appellate Court has
rightly dismissed the appeal filed by the appellant/ Promoter, thereby
upholding the order passed by the learned member, TN RERA, which this
Court finds no infirmity or reasons to interfere with the same. Accordingly,
this Civil Miscellaneous Appeal stands dismissed. No costs. Consequently,
connected miscellaneous petitions are closed. Mr.Siddharath Bhandari,
learned counsel appearing for the second respondent shall ensure that the
application made by the first respondent for the refund of GST amount
already paid, shall be processed and disposed of within a period of two
months from the date of receipt of a copy of this judgment.
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(J.N.B.J) (R.S.V.J)
24.01.2025
sts
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Internet : Yes/No
Index: Yes/No
Speaking Order: Yes/No
sts
To:
1) The Tamil Nadu Real
Estate Appellate Tribunal,
Chennai.
2) The Tamil Nadu Real
Estate Regulatory Authority,
Chennai
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J.NISHA BANU, J.
and
R.SAKTHIVEL, J.
sts
Judgment made in
Dated:
24.01.2025
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