BHUBANESWAR: Odisha Real Estate Appellate Tribunal (OREAT) has upheld a Rs 90 lakh penalty imposed on a city-based real estate developer for deviating from the sanctioned plan of its housing project in Puri but set aside a demolition direction issued earlier by Odisha Real Estate Regulatory Authority (Orera).
In its recent order, the tribunal held that the developer had constructed a G+10 commercial-cum-residential building despite having approval for a G+7 residential project at Sipasarubali. The deviation was challenged at Orera in 2024.
The tribunal said that the revised plan had never received final approval from Puri-Konark Development Authority (PKDA), and that mandatory clearances, including an Airports Authority of India NOC and pollution-related approvals, had not been obtained.
The tribunal agreed with Orera’s finding that the promoter violated the provisions of the Real Estate (Regulation and Development) Act, 2016, by carrying out development contrary to the sanctioned plan. It also upheld the Rs 90 lakh penalty, observing that the amount constituted only around 0.54% of the project’s estimated cost of Rs 166 crore.
However, OREAT ruled that Orera exceeded its jurisdiction by directing PKDA to demolish the unauthorised portions of the building. “The regulator’s powers under Sections 35 to 38 of the Real Estate (Regulation and Development) Act do not extend to ordering a development authority to carry out demolition,” it said, adding that “any such action would have to be taken independently under ODA Act”.
A significant development recorded during the appeal was that PKDA had regularised the existing G+10 structure through an order issued on May 21, after collecting compounding fees and other charges from the developer. While taking note of the regularisation, the tribunal referred to a series of Supreme Court judgments on unauthorised constructions.
OREAT observed that courts have consistently held that illegal structures should not ordinarily be condoned, and that authorities must act against violations of approved building plans. The tribunal said the validity of PKDA’s regularisation order would have to be examined in light of these principles laid down by the apex court.
