The Route to the Real Estate Appellate Tribunal (REAT)
If a homebuyer or a builder is dissatisfied with an order passed by the Real Estate Regulatory Authority (RERA) or its Adjudicating Officer, the law provides a clear pathway for appeal. Any aggrieved person may prefer an appeal before the Real Estate Appellate Tribunal (REAT) having jurisdiction over the matter.
However, the rules are distinctly structured to prevent developers from filing frivolous appeals merely to delay justice and exhaust homebuyers.
The Mandatory Pre-Deposit Rule for Builders
When a homebuyer files an appeal, they simply pay the standard filing fee. But when a builder (promoter) files an appeal against an order that directs them to pay money to a buyer, they must cross a massive statutory hurdle known as the "Pre-Deposit."
Section 43(5) of the RERA Act states that an appeal filed by a promoter shall not be entertained without the promoter first having deposited with the Appellate Tribunal a specific sum of money. The promoter must deposit at least 30% of the penalty, or the total amount to be paid to the allottee including interest and compensation imposed on him, before the said appeal is heard.
Can the Pre-Deposit be Waived?
Builders frequently file applications asking the Tribunal to waive this requirement, citing financial crunches. However, courts and tribunals have firmly held that the requirement of pre-deposit under Section 43(5) of the Act is mandatory and admits no exception. The Tribunal has no power to relax or dispense with that requirement.
What Happens to the Deposited Money?
Once the builder deposits the heavy sum to sustain their appeal, homebuyers often wonder if they can access those funds immediately.
- During the Appeal: Indian courts have consistently ruled against the withdrawal of the pre-deposit during the pendency of the appeal. The deposit cannot be partially or fully withdrawn while the case is still being actively fought.
- After the Appeal: While withdrawal during pendency is typically barred, refunds become possible after the appeal concludes. Once the appeal is decided, the tribunal will direct refunds or adjustments proportionate to the final decision.