In this article, Hardik Sabbarwal, pursuing Diploma in Entrepreneurship Administration and Business Laws from NUJS, Kolkata discusses on the filing of cases under the RERA tribunal and the consumer forum at the same time.

Introduction

The Real Estate (Regulation and Development) Act (RERA), which came into force on 1st May 2016, is a legal framework which was enacted to deal with the disputes of homebuyers, as much as it will help to boost the Real Estate Investment. The RERA is a game-changing legislation in the field of real estate as it provides exclusive protection to homebuyers, by setting up a RERA tribunal, which something they did not enjoy before. Though they had the National Consumer Dispute Redressal Commission (NCDRC), it provides certain restrictions and issues as it not only deals with real estate matters. The Commission is overloaded with other matters too. So in order to deal with real estate matters more effectively and efficiently, RERA Tribunal was established.

Big Relief to Homebuyers

RERA is first of its kind Act which is exclusive for the real estate sector, aiming to establish an authority, for the benefits of the consumer. It also seeks to look at important issues which in past has created a problem for homebuyer such as timely delivery of the project, quality of construction etc.

The regulation has come to become a big relief for lakhs of aggrieved home buyers. Earlier the Homebuyers would fall into, to invest in unapproved projects which falsely promise high returns, but now to protect the interest of the homebuyers only registered projects can approach RERA Tribunal.

Also, a restriction is put by RERA that developers cannot advertise their projects and seek customers’ bookings, without getting all the required permissions from the authorities. Moreover, now booking amount is also been fixed to 10 percent of the property cost, so builders cannot charge booking amount arbitrary.

The RERA Act has also made it mandatory for developers/project promoters to make all necessary disclosures about projects including permissions secured from authorities, promised date of delivery, date of launch, project specifications, amenities/facilities etc. And all this information is to be loaded on the project website by the builder. This information will help the consumer to do a proper due diligence check and make the right choices.

Also, one most important thing which RERA has done, that to save the investment which is collected by the consumer, RERA has made it mandatory for the developers to put 75 percent of investment in an escrow account, therefore it could not be used elsewhere. Also, RERA has forced the developer/builders to sell the property to the consumer by addressing only the carpet area of the property, which saves the consumer from cheating and help them to choose wisely.

Can you file a case under the RERA tribunal as well as consumer forum at one and the same time?

Though RERA does not bar the original jurisdiction of the National Consumer Dispute Redressal Commission, it is not possible to file a case at RERA Tribunal as well as at NCDRC at one and the same time. An aggrieved person has two option, either to approach RERA Tribunal or to approach Consumer Forum to seek redressal for his grievance. If a consumer decided to approach NCDRC he has to keep the pecuniary jurisdiction of the court in mind, that is the claim must be of one crore rupees or above and if a consumer decided to approach RERA Tribunal he will be guided by the Territorial Jurisdiction of the court i.e. the consumer has to approach the RERA tribunal in which the claimed property is situated, but it is to be kept in mind that only ongoing project fall within the ambit of RERA, whereas the jurisdiction of Consumer Forum applies to both existing as well as completed project.

Moreover, most of the states Legislation has an express clause in their respective RERA Act that for filling a complaint to RERA, the complainant has to ensure that no other complaint has been pending in any other court or authority. But Consumer Forum has not been excluded from such restriction, moreover the Act allows the complainant to withdraw the complaint, with consent of the forum, any complaint which is earlier lodged with a Consumer Forum and pending on or before the enactment of the act and file the same under the provision of RERA with regards to advance payment by a buyer, development of project as per sanctioned plan and inability to give possession as per the terms of agreement

We must keep in mind a thumb rule, that our laws do not permit forum shopping. Hence, an aggrieved party can only approach one of the two tribunals for disputes over the same matter, i.e. either to approach NCDRC with appropriate jurisdiction or to approach RERA Tribunal with Territorial Jurisdiction. As already said that there is no bar to approach a consumer forum but since RERA is a special Act and particularly set up to protect the interest of homebuyers, a consumer would be advised to approach the adjudicating officer. Also, there are some issues which a consumer could face if approaching a Consumer Forum for the relief, those are as follows:

1. Unless and until a complaint is not filed before NCDRC, an investigation cannot be initiated. Which is not same in the case of RERA.
2. In NCDRC only an agency which is registered or consumer can file a complaint, which is not true in case of RERA.
3. A consumer has to file a complaint first before the district-level authority and then with the state-level authority before knocking at the doors of the national-level body. Also when a complainant moves up the level, the cost of litigation grows. The same is not true of the RERA.
4. NCDRC can only impose fine on the defaulter but cannot impose them a jail term, but it is not same in the case of RERA. RERA can impose a huge fine on defaulting Promoter also can impose a jail time to the defaulter.

Difference between NCDRC and RERA

Conclusion

The Real Estate (Regulation and Development) Act, 2016 is a powerful and first of its kind legislation in the field of Real Estate. This regulation was much needed from years to solve the various problems of homebuyers and to fight with various irregularities in the field of Real Estate. It has established an authority and regulation aiming to protect the rights of the homebuyers. Though there is this new regulation, the aggrieved allottees are not restricted to approach Consumer Forum, it is this that a consumer cannot file the same complaint in both the tribunals at the same time. The consumer has to choose either to approach RERA or the Consumer Forum according to their case and situation also with the motive either to just receive compensation or fight for the jail term to the guilty Developers/Builder. But as the RERA is the a Legislation only exclusive for the field of Real estate it is advised to the consumer or aggrieved party to approach the RERA Tribunals as there is obligation on the Tribunal to solve the dispute as fast as possible but is also to be noted that, the NCDRC in recent time in other to protect the interest of the buyers have made changes to the Consumer Protection Act in favour of buyers. It ruled that developers cannot force buyers to settle their disputes through arbitration by restraining them from approaching consumer forums. So now it all depends upon the aggrieved party where to approach.