UP-Rera welcomes SC order on home buyers seeking justice from consumer forums

The Uttar Pradesh-Real Estate Regulatory Authority(UP-Rera) on Tuesday said that they welcome the recent order by the Supreme Court, which enables home buyers to

The Uttar Pradesh-Real Estate Regulatory Authority(UP-Rera) on Tuesday said that they welcome the recent order by the Supreme Court, which enables home buyers to seek justice under the Consumer Protection Act even though their rights are protected by the Real Estate Regulatory Act of 2016.

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“We welcome the Supreme Court’s order because the homebuyers now have more choices. If they feel they can get speedy justice in consumer courts, then they can seek justice there. On the other hand, if they believe that the Rera will provide them justice in a timebound manner, then they can approach us,” said Balvinder Kumar, a member of UP-Rera.

However, earlier, in March 2019, the UP-Rera had written to the ministry of housing and urban affairs, seeking amendments in the Real Estate (Regulation and Development) Act, 2016. In the letter, the regulatory body had mentioned three points: First, the regulatory body should be vested with directive powers; second, the National Consumer Disputes Redressal Commission should not hear home buyers’ cases, and third, the National Company Law Tribunal (NCLT), which hears realtors’ cases under the Indian Bankruptcy Code (IBC-2016), should not hear a case in a housing project until more than 10% buyers — out of the total number of purchased flats in a housing project — approach it for justice.

SC Justice UU Lalit, on Monday, in its order, said that the Section 79 of the Real Estate Regulatory Authority Act, 2016, does not stop consumer forums to hear pleas of home buyers seeking justice under the provisions of the Consumer Protection Act. The order came in response to a counter plea filed by a Gurugram-based developer, who had sought the quashing of an order by the consumer forum in response to a plea filed by a homebuyer, who was given relief. The consumer forum had imposed a penalty of ₹50,000 penalty against the developer for a delay in delivery.

Real estate experts pointed out that the SC order was a landmark judgement for home buyers as Rera, over the years, has failed to protect the rights of the home buyers.“Homebuyers are happy because UP-Rera has become ineffective in safeguarding their rights. Rera was hoping that homebuyers should only file cases only with them stop going to consumer forums. We feel that the consumer forums will provide justice in a better manner,” said Abhishek Kumar, president of Noida Extension flat owners association.

“It is a very logical order because you cannot restrain a homebuyer from seeking justice at consumer forums. Rera is an additional remedy. However, it does not stop the homebuyers from going to consumer forums. Rera’s orders are not being implemented because it does not have power to direct the government bodies. Therefore, either the government should give more powers to Rera or let the buyer decide where to seek justice,” said Kumar Mihir, a Supreme Court lawyer and an expert on issues concerning home buyers.

City-based real estate developers, however, had a mixed reaction to the order.“The SC order will impact the real estate sector negatively because it will create confusion in the minds of home buyers, investors and others. When Rera was formed by the government of India as expert body exclusively for the real estate sector then it should have powers to settle issues that crop up. Rera understands all realty projects better and can come up with better solutions. The SC order defeats the very purpose of the formation of an expert body,” said RK Arora president of the UP Chapter of National Real Estate Council.

Developer Suresh Garg, member of legal committee of the Confederation of Real Estate Developers’ Association of India (CREDAI) said, “The SC order gives liberty to home buyers to seek justice either at a consumer forum or with Rera. However, we have seen that home buyers get justice in a lesser time and at a lesser cost at Rera.”

Prashant Kumar Tiwari, president of Western UP wing of CREDAI, said, “Rera is an expert body and home buyers also prefer it over the consumer court.”