In this article, Yash Tandon discusses Impact of RERA on state laws.

Introduction

The disputes regarding the real estate are inevitable by nature and the one who gets affected most is the buyer. To curb such difficulties and enhance the solution to such, the Real Estate Act, commonly known as RERA was passed by the Government of India in 2016, and it came into effect in 2017 with all its provisions in proper order. This act intends to solve the problems related to the real estate sector, which in turn will help the buyers to know the intricacies involved in the respective sector and to know their position in the contractual transaction. For long, home purchasers have complained that land exchanges were disproportionate and intensely for the builders and dealers. RERA and the administration’s model code, mean to make a more impartial and reasonable exchange between the dealer and the purchaser of properties, particularly in the essential market. RERA, it is trusted, will make land buy less difficult, by getting better responsibility and straightforwardness, provided that states do not dilute the provisions and the spirit of the act.

What are the provisions of RERA? How Does it ensure that there is no oppression by Builders/Developers?

Some of the important provisions of The Real Estate Act which help the buyers to know their rights and also which reflects the duties of the builders to notify the buyers are as follows:

• The builder has to inform the allottees about any minor addition or alteration.
• Consent of 2/3rd allottees about any other addition or alteration.
• No launch or advertisement before registration with RERA
• Consent of 2/3rd allottees for transferring majority rights to any 3rd party.
• The builder has to share with the buyer the information project plan, layout, government approvals, land title status, subcontractors.

How Does RERA Ensures Safety to Buyers?

The Establishment of the Regulatory Authority

The most important aspect of this act is the establishment of a proper regulatory authority which was awaited for quite a long time. The Act sets up Real Estate Regulatory Authority in each state and union domain. Its capacities incorporate insurance of the interests of the partners, collecting information at an assigned storehouse and making a strong grievance redressal framework. Also to prevent time lags, the authority has mandated to disburse the applications within a maximum period of 60 days and the same may be extended only if a reason is recorded for the delay. Further, the Real Estate Appellate Authority which is under Section 2 subclause (f) of the Real Estate Act shall be the appropriate forum for appeals.

Compulsory Registration Clause under Section 3 and 4 of the Act

As indicated in the aforementioned sections of the act, each land venture (where the aggregate region to be produced surpasses 500 sq meters or more than 8 flats is proposed to be created in any stage), must be enrolled with its individual state’s RERA. Existing undertakings where the completion certificate (CC) or occupancy certificate (OC) has not been issued are likewise required to consent to the enlistment necessities under the Act. While applying for enlistment, promoters are required to give the point by point data on the undertaking e.g. arrive status, subtle elements of the promoter, endorsements, timetable of fulfillment, and so forth. Just when enrolment is finished and different endorsements are set up, the undertaking will be advertised.

Also to ensure that violation of the Act is not taken lightly, stiff monetary penalty (up to 10% of the project cost) and imprisonment has been prescribed against violators.

Which projects come under the ambit of the Real Estate Act (RERA)

The following are the list of the various types of projects which come under the ambit of the aforementioned act. They are:

• Commercial and residential projects including plotted development.
• Projects measuring more than 500 sq meters or 8 units.
• Projects without Completion Certificate, before the commencement of the Act.
• The project is only for the purpose of renovation/repair/re-development which does not involve re-allotment and marketing, advertising, selling or new allotment of any apartments, plot or building in the real estate project, will not come under RERA.
• Each phase is to be treated as a standalone real estate project requiring fresh registration.

How to make complaints against the builders?

Procedure for Appeal

Section 43(5) of the Act provides that any person aggrieved by any direction or decision or order made by the Authority or by Adjudicating Officer may prefer an appeal before the Tribunal having jurisdiction over the matter.

Any person who has an interest in the project can file an application with the RERA authority. The application can also be filed online, as per the format available. The complainant must provide:

• “The particulars of the applicant and the respondent.
• The registration number and address of the project.
• A concise statement of facts and grounds of the claim.
• The reliefs and interim reliefs, if any, sought.
• The Tribunal may entertain an appeal after the expiry of 60 days if it is satisfied that there was sufficient cause for not filing it within that period.

To initiate proceedings before the adjudicating officer for compensation under RERA, the complainant needs to file a similar application. This application must also be made in the prescribed format and must contain particulars similar to those required in the application to the RERA authority.

What matters are entertained by the Real Estate Tribunal

The Tribunal refers to the matters are mentioned in the below list. They are-:

• If there is a delay by the builder in providing the house to the buyer
• If there is any sort of misconduct which leads to any hindrance for the buyer to procure the house
• If there is any sort of discrimination imposed by developers on sale of homes
• If the builder has not paid the compensation amount within 45 days of the claim
• If the builder denies the buyers demand of refund or compensation at an interest rate of the SBI’s marginal cost of lending rate (MCLR) plus 2% (effectively around 11%)
• If the builder has not provided information about status of approvals received and expected date of receipt, modifications in sanctioned plans and specifications approved by the competent authority within 15 days of expiry of each quarter

Where one should go – Ordinary Court or The Real Estate Agents Disciplinary Tribunal?

The doors of consumer courts will always stay open for homebuyers to redress their grievances. “For any dissension in regard of issues secured under RERA and grievances which are pending under the steady gaze of any customer court set up under the Consumer Protection Act, 1986, recorded before the initiation of the RERA Act, the complainant may document an application before the mediating officer of RERA in the wake of looking for consent of the buyer discussion or commission, all things considered, for withdrawal of the objection from such purchaser gathering or commission.”

Does RERA have an overriding effect on state laws on the subject of real estate?

There is no bar to moving toward a purchaser gathering, however since RERA is an extraordinary Act and especially set up to ensure the enthusiasm of homebuyers, a customer should approach the settling officer. Being an uncommon demonstration, RERA now and again overriding affect state laws on land matters.

Featuring that RERA expressly banishes common courts from the engaging debate (suits or procedures) in regard to issues which the Real Estate Regulatory Authority or the Appellate Tribunal is “enabled under the Act”. Further, the Act permits the wronged gathering to pull back (with assent of the discussion) any grievance prior stopped with a shopper gathering and pending at the latest the beginning of the Act and record the same under the arrangements of RERA concerning advance installment by a purchaser, improvement of venture according to authorized arrangement and powerlessness to give ownership according to the terms of understanding.

How many states and union territories have implemented RERA

The main issue of the aforementioned act is its implementation of the states and union territories. In only 16 states RERA has been implemented, and in 7 union territories, it has been successfully implemented. There are still 13 states which yet to get registered under the act. They need to get their projects registered under this scheme.

The following table showcases the list of the states and union territories which are registered under the Act along with their registration of projects.

Out of these just four states – Gujarat, Maharashtra, Madhya Pradesh and Punjab – have established their permanent Real Estate Regulatory Authority, while 19 states/UTs have set up interim authorities experts, an authority with the Housing and Urban Affairs Ministry said.

Just 23 States/UTs have informed the tenets under the Act, while six states have drafted the principles, however, have not yet told. A sum of nine states/UTs, named the Appellate Tribunals under the Real Estate Act, while just seven states have begun the online enlistment under the Act.