Bihar RERA Holds Section 39 Of RERA Act Cannot Be Used To Review Liability On Merits

The Bihar Real Estate Regulatory Authority (Bihar RERA) on 31 August held that rectification under Section 39 of the Real Estate (Regulation and Development) Act, 2016 (RERA Act) cannot be used to materially alter a substantive finding of liability, as doing so would amount to reviewing the original order on merits.

Inquiry Commissioner Sanjaya Kumar Singh rejected an application filed by Kumod Kumar, Complainant, a former director of Ezzion Constructions Pvt. Ltd., seeking deletion of his name and liability from an earlier refund order concerning the Ramagya Residency project. The Authority observed:

“Rectification cannot be invoked for re-hearing the original matter, re-appreciating evidence, reconsidering disputed questions of fact, taking a different view on materials already considered, or substituting a fresh decision in place of the decision already rendered.”

The dispute arose from a complaint filed by Md. Kashif Yunus concerning transactions based on an agreement dated 1 January 2012, followed by a Memorandum of Understanding and another agreement dated 27 June 2014.

Kumar contended that Clause 6 of the 2012 agreement placed liability on the directors of Ezzion Trading Company Pvt. Ltd., whereas he had been associated with Ezzion Constructions Pvt. Ltd., a different entity. He claimed that Ejaz Hussain handled the financial transactions and that he had resigned as a director of Ezzion Constructions with effect from 21 June 2018.

In the original proceedings, however, Bihar RERA on 11 March 2022 directed Kumar and Hussain to refund the consideration amount with interest.

Kumar subsequently sought rectification of the order under Section 39 of the RERA Act, which permits an authority to rectify a mistake apparent from the record. He sought deletion of his name and liability, arguing that the Authority had failed to distinguish between Ezzion Trading Company and Ezzion Constructions while fixing liability. He further argued that he had no role in the company's affairs after his resignation and that Hussain had handled the transactions underlying the original complaint.

Md. Kashif Yunus opposed the application, contending that Kumar had actively participated in the management of Ezzion Constructions and the Ramagya Residency project, had defended himself separately in the original proceedings, and that deleting his liability would amount to a substantive review barred under Section 39.

The Authority noted that Kumar had inadvertently referred to “Rule 27” instead of “Regulation 27” of the Bihar Real Estate (Regulation and Development) Regulations, 2024. It clarified that the nomenclature error was not, by itself, a ground to reject the application and that the plea had to be examined on its substance under Section 39 of the RERA Act.

It held that rectification cannot be used to re-hear the original dispute, re-appreciate evidence, reconsider disputed questions of fact or substitute a fresh decision for one already rendered.

The Authority found that Kumar was, in effect, seeking reconsideration of “the very basis” on which liability had been fastened upon him, rather than correction of a clerical, arithmetical or patent mistake. It said:

“The relief sought, if granted, would not merely correct an apparent error but would materially alter the substantive determination of liability made in the original proceedings. Such a course would amount to reviewing and modifying the order on merits, which is beyond the permissible scope of Section 39 of the RERA Act, 2016"

It also noted that Kumar had participated in the original proceedings through counsel and filed his own reply. The March 2022 order also recorded submissions made on his behalf regarding his role in running and managing the project. The matter, therefore, could not be treated as involving an obvious error made in his absence.

The Authority further noted that Kumar had challenged the 11 March 2022 order before the Real Estate Appellate Tribunal and thereafter approached the Patna High Court. Having already availed those remedies, Bihar RERA held that Kumar could not invoke its limited rectification jurisdiction to secure a substantive alteration of the same order.

It also took note of an earlier rectification petition filed by Kumar on 13 February 2026, which he withdrew pursuant to an order dated 11 May 2026. The Authority held that substantially the same relief could not thereafter be pursued merely by giving the proceedings a different nomenclature.

The Authority also cautioned Kumar and his counsel to exercise due care while instituting future proceedings and to disclose earlier proceedings concerning the same subject matter.

Accordingly, Bihar RERA rejected the plea to rectify or modify the 11 March 2022 order, holding that Kumar had failed to demonstrate any error apparent from the record. It nevertheless left him at liberty to pursue any other remedy available in law, subject to the applicable statutory provisions and limitation.

Appearances for petitioner (Kumod Kumar): Advocate Amit Kumar.