Bhubaneswar: The Odisha Real Estate Appellate Tribunal (OREAT), in a recent ruling, has held that the Odisha Real Estate Regulatory Authority (ORERA) cannot retain the entire project registration fees in cases of rejection or delayed withdrawal and has termed such action arbitrary and lacking legal backing.The tribunal, hearing two similar appeals of two city-based prominent residential projects, dismissed the authority’s orders denying refunds and directed it to return the deposited amounts after retaining only 12% as processing charges. In the two cases, the ORERA took a cumulative registration fee of over Rs 20 lakh.In the first case, the developer deposited Rs 16.14 lakh for project registration under the earlier ORERA 1.0 portal. After being asked to apply afresh under the upgraded ORERA 2.0, the developer sought either migration of its application or refund of the fee. However, ORERA rejected the request, citing the rule that refund applies only in a 30-day timeframe.In the second case, another developer paid Rs 8.60 lakh towards registration of its residential project. The application was later rejected over discrepancies in building plan approvals. Its request to either refund or adjust the fee was also turned down on the grounds that the law does not provide for such relief after rejection.ORERA, in the matter, argued that the RERA Act allows partial refund after deducting 10% as a processing fee only if the promoter withdraws the application within 30 days. Since both developers sought relief beyond this window or after rejection, the authority maintained it had no power to refund or adjust the fees.Rejecting the authority’s point, the tribunal observed that the rule is silent on refund in cases of rejection or delayed withdrawal, and such silence cannot be treated as granting ORERA the power to confiscate the entire amount. “Public authorities can exercise only those powers explicitly conferred by law,” the order reads.It further held that retaining 100% of the registration fee amounts to unjust enrichment and violates constitutional principles. The tribunal emphasised that registration fees under RERA are regulatory in nature and not penalty. Complete forfeiture is disproportionate and inconsistent with the objective of facilitating real estate development, it said.Passing the final judgement, the tribunal directed ORERA to refund the registration fees in both cases after deducting 12% as administrative charges. The bench also recommended that ORERA amend its rules to introduce a clear and structured mechanism for fee refund in cases of rejection or delayed withdrawal, on the lines of other states.
