Appellate Tribunal Cannot Decide Merits for the First Time When MahaRERA Dismissed Complaint Only on Maintainability

The Bombay High Court held that where MahaRERA had dismissed a complaint only on the preliminary issue of maintainability, the Maharashtra Real Estate Appellate Tribunal could not, after finding the complaint maintainable, proceed to adjudicate the merits for the first time. The proper course was to remand the complaint to MahaRERA for merits adjudication, preserving the parties' appellate remedy. The Court distinguished the Supreme Court's decision in Nadakerappa, explaining that its principle against routine remand applies where the trial forum has already adjudicated the matter on merits. The Second Appeal was allowed, the Appellate Tribunal's order was set aside, and the complaint was remanded to MahaRERA for decision on merits, preferably within six weeks. (Paras 3–10)

Key Proposition: An appellate tribunal cannot decide the merits of a dispute for the first time when the forum of first instance dismissed the proceeding solely on a preliminary issue; once maintainability is restored, the matter must ordinarily be remanded for merits adjudication so that the statutory appellate remedy is preserved.

• RERA – Appellate jurisdiction – Maintainability decided by MahaRERA without merits adjudication – Whether the Appellate Tribunal could itself decide merits – Held, no; remand was required. (Paras 4–10)
• Appellate procedure – Right of appeal – Whether first-time merits adjudication by the appellate forum would curtail a party's statutory appellate remedy – Held, yes. (Paras 4–5)
• Remand – Nadakerappa distinguished – Whether the Supreme Court's caution against routine remand applied where the first forum had not considered merits – Held, no. (Paras 7–9)

Background / Synopsis :

MahaRERA dismissed the allottees' complaint on 2 April 2024 solely because the agreement contained an arbitration clause. (Para 3)

The allottees appealed to the Maharashtra Real Estate Appellate Tribunal, which found the complaint maintainable notwithstanding the arbitration clause. (Para 3)

Instead of remanding the matter, the Appellate Tribunal directed that it would itself decide the complaint on merits, apparently taking account of the complainants' status as senior citizens. (Paras 1, 6)

Keyana Estate LLP challenged that approach in the Second Appeal; the High Court admitted the appeal on a substantial question of law and heard it finally with consent. (Para 2)

Issues For Consideration :

• Where a first-instance authority dismisses a proceeding solely on a preliminary issue and the appellate forum disagrees, whether the appellate forum can itself decide the merits or must remand the matter.
• Whether the Appellate Tribunal's decision to proceed on merits curtailed the parties' statutory right to an appellate remedy.

Submissions Of Parties :

Appellant – Keyana Estate LLP:

• Relied on the Supreme Court's decision in Nadakerappa to contend that remand should not be ordered as a matter of course and that an appellate court should endeavour to decide matters on merits where the evidence is available.

Respondents – Ashok D. Karwa and Anr.:

• Contended in substance that, once the complaint was found maintainable, the Appellate Tribunal could proceed with the matter rather than remand it, relying on the need for effective adjudication and the circumstances of the complainants.
• Relied on Nadakerappa in support of the proposition that appellate forums should avoid unnecessary remands.

Court's Observations & Analysis :

Re: Appellate forum deciding merits for the first time

• The Court explained that when a suit or proceeding is dismissed on a preliminary point without merits adjudication, an appellate court that disagrees with that preliminary finding should ordinarily remand the matter to the court of first instance. (Para 4)
• Deciding merits for the first time at the appellate stage would deprive the aggrieved party of one level of appeal because the first-instance forum would never have adjudicated the merits. (Paras 4–5)
• Convenience or advanced age of parties could not justify the appellate tribunal usurping the adjudicatory role of the first-instance authority. (Para 5)
• Held: The Appellate Tribunal could not itself decide the merits in the present circumstances. (Para 9)

Re: Application of Nadakerappa

• The Court distinguished Nadakerappa because that case concerned a situation where the court of first instance had already adjudicated the dispute on merits and a routine remand was being considered. (Paras 7–8)
• Here, MahaRERA had never considered the merits; it had dismissed the complaint only on maintainability. (Paras 6–9)
• Held: Nadakerappa did not prevent remand in the present case; rather, the proceedings had to return to MahaRERA for merits adjudication. (Paras 8–9)

Notable procedural principle

• The Court treated the preservation of the statutory appellate remedy as a central reason for remand.
• The appellate tribunal's supervisory/corrective jurisdiction did not permit it to act as an originating court and bypass the first-instance adjudication. (Para 5)

Notable Observations: Notable Observations: None.

Decision & Directions :

• The order dated 19 March 2025 passed by the Maharashtra Real Estate Appellate Tribunal in Appeal No. AT00600000214962 of 2024 was set aside.
• Complaint No. CC0600000094344 was remanded to MahaRERA for adjudication on merits.
• MahaRERA was directed to decide the complaint as expeditiously as possible, preferably within six weeks without seeking extension, particularly because the complainants were senior citizens.
• Parties were directed to appear before MahaRERA on 23 October 2026 with a downloaded copy of the High Court order and seek fixation of hearing dates.
• All contentions on merits were expressly kept open.
• The Second Appeal was allowed and disposed of; there was no order as to costs.
• Interim Application No. 9498 of 2025 did not survive and was disposed of.

Legal Provisions Discussed & Precedents Cited :

• Code of Civil Procedure, 1908 – Order VII Rule 11 was used by the Court as an illustration of the principle concerning dismissal on a preliminary point and subsequent remand.
• Real Estate (Regulation and Development) Act, 2016 / MahaRERA framework – complaint maintainability, appellate jurisdiction and merits adjudication.
• Appellate procedure – statutory right of appeal and the limits of appellate adjudication where merits were not considered at first instance.
• Nadakerappa Since Deceased by LRs and Ors. v. Pillamma since deceased by LRs and Ors., Civil Appeal Nos. 7657 of 2017, decided on 31 March 2022 – distinguished.
• Smt. Sunita Singh and Anr. v. Keyana Estate LLP, Appeal No. AT0060000000214983 of 2024, decided on 24 March 2025 – referred to as an example where the Appellate Tribunal had adopted remand