This article is written by Rushikesh Jayantrao Dharmadhikari, pursuing Certificate Course in Real Estate Laws from LawSikho. The article has been edited by Prashant Baviskar (Associate, LawSikho) and Ruchika Mohapatra (Associate, LawSikho).
Table of Contents
Previously, before the enactment of the RERA Act of 2016, developers would alter, revise, and adjust the original layout and sanction plans to suit their demands, leaving homeowners feeling duped and their funds were frozen in under-construction units. The promoter is required to follow the authorities’ approved plans and project requirements for the proposed project. Other than the promoter who has agreed to accept apartments in such a project, the builder must get the prior written permission of at least two-thirds of the allottees for the entire project. The RERA Act of 2016 was enacted with the goal of safeguarding homebuyers while also luring investors.
The RERA Act of 2016 was enacted with the goal of protecting homebuyers and encouraging investment in the real estate market. Previously, the developers would alter and adjust the original layout and sanction plans of their own accord, leaving homeowners feeling duped as their funds lay frozen in under construction. This conundrum has now been resolved thanks to the requirements of the RERA Act of 2016. According to Section 11 (3) (a) of the RERA Act, 2016, it is the promoter’s responsibility to make the sanctioned plans, layout plans, and specifications, approved by the competent authority, available to the allottee at the time of booking and issue of allotment letter, by the display at the site or such other place as may be specified by the Authority’s regulations. This article deals with the modifications of sanctioned plans under RERA.
The sanctioned plan under RERA
According to Section 2 (zq) of the RERA Act of 2016, “sanctioned plan” refers to the site plan, building plan, service plan, parking and circulation plan, landscape plan, layout plan, zoning plan, and any other plan, as well as structural designs, if applicable, and permissions such as environmental permission and other permissions, that are approved by the competent authority prior to the start of a real estate project.
According to Section 4 (2) (d) of the RERA Act, 2016, while submitting for project registration, the promoter must provide the sanctioned plan, layout plan, and specifications of the proposed project or phase thereof, as well as the entire project as sanctioned by the competent authority. The promoter is required to follow the sanctioned plans and project specifications for the proposed project as approved by the authorities under Section 14 (1) of the RERA Act, 2016. However, according to Section 14 (2) of the RERA Act, 2016, the promoter is not authorized to make any changes to the sanctioned plan without the flat owner’s prior written consent.
In addition, if the promoter desires to make any changes or additions to the sanctioned plans, layout plans, or the entire project, he must first obtain the written approval of at least two-thirds of the allottees, other than the promoter, who have committed to take apartments in such a project.
Provisions concerning the approved plan
According to Section 11 (3) (a) of the RERA Act, 2016, it is the promoter’s responsibility to make the sanctioned blueprints and layout plans available to the allottee at the time of booking and issue of allocation letter. It must comply with specifications approved by a competent authority, as evidenced by a display at the site or in any other location specified by the authority’s regulations.
According to Section 4 (2) (d) of the RERA Act, 2016, the promoter must attach certain documents when applying for project registration, including the sanctioned plan, layout, and specifications.
The promoter must follow the sanctioned plan and project specifications for the proposed project as approved by the authorities, according to Section 14 (1) of the RERA Act, 2016. The promoter must create and complete the proposed project in accordance with sanctioned blueprints, layout plans, and specifications that have been approved by the competent authorities.
The promoter is not authorized to make any changes to the sanctioned plan without the prior written approval of the flat owner, according to Section 14 (2) of the RERA Act, 2016. Regarding the amendment of the sanctioned plan approved by the competent Authority, any clause contained in any agreement, the contract will not prevail. As a result, without the previous written agreement of the person who owns that apartment, a promoter has no authority to make any modifications or changes to the sanctioned plans.
Furthermore, Section 14 (2) (ii) of the RERA Act, 2016 clarifies that any alterations or additions to the sanctioned plan, layout plans of the entire project, or common areas of the building cannot be made unless the developer obtains the prior written consent of 2/3rd of the allottees who have agreed to take apartments in such project, excluding the Promoter. As a result, a developer is legally obligated to follow the approved blueprints during construction and cannot depart from them.
The allottee has the right to obtain information about the promoter’s sanctioned plan and layout plan for the real estate project under Sections 19(1) and 19(5) of the RERA Act, 2016. Allottees must have the right to withdraw from a project if the promoter fails to supply the information and specifics of the sanctioned plan. The Promoter must be responsible for the whole amount paid by the allottee, plus interest.
Forced consent is a concern
While supporters of the RERA are optimistic about the industry’s future prospects, home purchasers have a different storey to tell. Say, person X recently reserved an apartment in an upcoming RERA-registered housing complex in Lucknow, Uttar Pradesh, being built by a reputable developer. X placed a 10% down payment and proceeded to register the agreement for sale with the developer, confident that the builder would fully adhere to the RERA.
After registering the agreement at the sub-office, registrar’s X was taken aback when the developer asked him to sign a paper labelled “Unconditional and irrevocable consent to make changes in project plans” at the last minute. The developer wanted X to sign the letter because he wanted him to agree to any future alterations he might make to the approved building designs. The developer would be free to make any alterations he wanted, as long as the approval was unconditional, irrevocable, and given in advance. X declined to sign the document, citing Section 14 of the RERA, because he suspected the developer of being hostile.
Section 14 of the RERA states that no changes to plans can be made without the buyer’s consent.
Developers are prohibited from making any changes to the project’s sanctioned plan without the consent of the home buyers under Section 14 of the RERA. Section 14 states that any changes to an individual apartment’s designs and specifications are only permissible with the prior written consent of the house buyer. Changing the layout of the entire project and the building’s common areas, on the other hand, requires the developer to get the prior written consent of two-thirds of all house buyers (or allottees) in the project. As a result, the developer is legally obligated to follow the approved plan.
The concept of ‘informed consent’
Informed Consent is a legal notion that states that people must provide their consent after receiving information and asking relevant questions There are 4 components of informed consent including decision capacity, documentation of consent, disclosure, and competency.
The phrase ‘previous written consent’ in Section 14 is critical, as it implies that house buyers must be informed of potential project alterations before giving their consent. The Bombay High Court had the opportunity to interpret Section 7 of the Maharashtra Ownership of Flats Act (MOFA), 1963, which is equivalent to Section 14 of the RERA, in the matter of Madhuvihar Cooperative Housing Society and others vs. Jayantilal Investments and others, 2010 (6) Bom CR 517. It was held that a home buyer’s assent must be “informed consent,” meaning that it must be freely granted after the flat purchaser has been given complete and full knowledge of the project or scheme that the builder intends to implement. Furthermore, the consent must be explicit and applicable to the developer’s intended project or scheme. The bench went on to say that blanket or general consents received in advance by developers, especially at the signing of agreements, were illegal. The Maharashtra Ownership of Flats Act was intended to achieve a certain goal, and such ambiguous consents failed that goal. As a result, the court gave the statute a purposive construction, holding that developer malpractices could not be allowed to subvert the Act’s basic aim.
A binding precedent has been set by the Supreme Court’s decision on proposed changes
Because the Bombay High Court is a court of record under Article 215 of the Indian Constitution, the law it makes will be binding throughout Maharashtra and will set a strong precedent for other high courts. The judgement in the Madhuvihar Cooperative Housing Society case will apply to all proceedings before the Real Estate Regulatory Authority and the Real Estate Appellate Tribunal because Section 7 of the MOFA is comparable to Section 14 of the RERA. As a result, if a developer wishes to change the layout of the project, he must first seek the written approval of all allottees. After notifying them of all the proposed changes and adjustments, as well as the impact on the developer, such approval should be acquired. This will allow the allottees to make an informed decision based on their personal interests.
Consents obtained under duress can be revoked
It’s worth noting that in person X’s situation, if the developer coerced him into giving his permission by any means, the contract might be declared illegal under Section 19 of the Indian Contract Act, 1872. Section 19 states that any consent gained through deception, coercion, misrepresentation, or undue influence is voidable at the injured person’s request. As a result, if a property buyer has agreed to a contract under duress from a developer, he can readily contest it and have it declared null and void under Section 19 of the Indian Contract Act, 1872.
Using the Real Estate Regulatory Authority to file a complaint
The best course of action for property buyers who are being pressured by developers to sign such unethical letters is to register a complaint under RERA Section 31. When a complaint is lodged, the Regulatory Authority can use its investigation powers under Section 35 of the Act to look into the situation. If the Authority determines that the developer has broken the letter and spirit of Section 14, it might impose a penalty of 5% of the project’s cost. Furthermore, if it discovers that the developer is engaging in fraudulent operations, it has the authority to cancel the project’s registration under Section 7 of the Act.
A law without teeth, without enforcement, is a time-honoured principle. The key to enforcement now rests in the hands of property buyers, thanks to the passing of the RERA. If a person witnesses any oblique malfeasance by a RERA-registered developer, he must promptly file a complaint under Section 31 of the RERA, requesting that the Authority examine the incident and penalize the developer appropriately. Because RERA proceedings are generally swift and unencumbered by the civil court’s delay culture, home buyers have reason to expect that justice will be served in their cases. Prompt action in any scenario will not only serve as a deterrent but also enhance consumer awareness
Prior to the RERA Act’s introduction in 2016, there were worries about the imposition of provisions that permitted developers to change, rewrite, and amend the original layout/plans as they saw fit. In situations like these, vulnerable allottees who had their assets frozen were left with no choice but to comply with one-sided pro-developer terms and conditions. However, with the passage of the RERA Act in 2016, house buyers were finally able to exhale a sigh of relief and felt safer as a result of its provisions.
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