RERA Cannot Initiate Suo Motu Proceedings Solely On RTI Query: REAT For NCT Of Delhi And UT Of Chandigarh

The Real Estate Appellate Tribunal for the NCT of Delhi and UT of Chandigarh recently held that suo-motu proceedings under the Real Estate (Regulation and Development) Act cannot be initiated merely on the basis of an RTI query, particularly after a project has been completed and possession handed over.

A bench of Judicial Member Lorren Bamniyal observed, “while exercising the suo-moto powers vested in it under the statute, there is an element of caution to be exercised by the Authority, more especially in cases where the project has been completed and possession of the units has been handed over to the buyers. There is an inbuilt requirement of caution by way of a prior enquiry and / or investigation into elements / information which is forming the basis for initiation of the suo moto proceedings. This can also be done by seeking information from the Promoter by way of a formal letter initially instead of straightaway taking resort to the enabling powers under Section 35 and 37 of the Act. Suo-moto proceedings cannot solely be based on a mere complaint received by the Authority or an RTI query being filed before it, as is the case in the present appeal”

The tribunal was hearing an appeal filed by Omaxe Heritage Pvt. Ltd. against orders passed by the Delhi Real Estate Regulatory Authority in 2025 directing the company to furnish details of 3,088 allottees, payments received, and addendums executed in its commercial redevelopment project “Omaxe Chandni Chowk”.

The Authority had also directed the personal appearance of the company's directors.

The proceedings had begun in 2022 after an RTI application alleged that the developer had offered assured returns to investors. By an order dated October 31, 2023, the Authority directed the promoter to disclose payment plans offered to buyers, incorporate rebate structures in the Agreement for Sale instead of through addendums, register addendums already executed, and ensure execution of sub-leases between the Municipal Corporation of Delhi and sub-lessees.

A penalty of Rs 10 lakh was imposed for non-disclosure of a construction loan of about Rs 440 crore. According to the promoter, the project received an occupancy certificate in October 2023 and possession had been handed over thereafter.

Before the tribunal, the promoter argued that the orders passed in September and October 2025 widened proceedings that had already been concluded by the order of October 2023 despite compliance with the earlier directions.

It was submitted that once the project stood completed and possession delivered, the Authority could not repeatedly seek the same information. The authority, however, contended that under Sections 35 and 37 of the Act it could call for information from the promoter and issue directions whenever required to safeguard the interests of buyers, and that further directions were issued after deficiencies were noticed in the information earlier furnished.

After exmaining the Act, the tribunal noted that promoters are required to file quarterly progress reports containing details of bookings, payments and construction status, which provide the Authority with sufficient material to supervise the project while it is under development.

It held that once such information already exists on record and the project has been completed, repeated inquiries are not envisaged under the Act.

The tribunal also rejected the basis of the proceedings relating to assured returns, observing that incentives and return-linked schemes are commonly offered in the real estate market to attract buyers and cannot by themselves be treated as illegal.

It further found delay on the part of the Authority, stating, “The Authority cannot cover its own inaction of not having acted on information filed and available before it by belatedly seeking information, which has already lost its purpose after the handing over of possession to the allottees.”

Holding that the continuation of the proceedings after the completion of the project lacked legal justification, the tribunal set aside the orders dated September 16, 2025, 8 October 2025, and October 15, 2025, and quashed the suo-motu proceedings.

It also requested the Commissioner of the Municipal Corporation of Delhi to ensure that the process of registration of sub-lease deeds in favour of buyers is completed expeditiously in terms of directions earlier issued by the Delhi High Court.

For Appellant: Advocates Mayank Wadhwa, Shashank Mishra; Authorised Representative Neha Chaturvedi.

For Respondent (Real Estate Regulatory Authority, New Delhi): Advocates Biraja Mahapatra, Nishant Yadav.