[ecis2016.org] Although the Real Estate Act is now in force, many states are yet to notify their respective rules or establish the regulatory authority under the Act. We examine the options available to aggrieved home buyers, in such cases
The Real Estate (Regulation and Development) Act (RERA) is now a reality. The central government had already set the rules and now, the state governments are required to follow suit. States are required to appoint RERA authorities and notify the rules under the Act. Experts pointed out that the provisions of RERA are in effect throughout India, except Jammu and Kashmir. However, several states have not yet adopted the RERA rules or appointed the authorities under the Act. So, what are the options available to home buyers in such states?
Courts that aggrieved home buyers can approach
According to Section 79 of the Real Estate Act, civil courts are barred from entertaining disputes (suits or proceedings) with respect to matters, which the adjudicating officer or the authority or the appellate tribunal is empowered under the Act, to determine. However, consumer dispute redressal forums (at the national, state or district levels), have not been barred from the ambit of the Act.
[ecis2016.org] What is RERA and how will it impact the real estate industry and home buyers?
“Although RERA expressly bars the jurisdiction of civil courts, it does not bar the jurisdiction of consumer courts. Therefore, in states where no RERA authority has been appointed or where the rules under the RERA have not yet been framed, home buyers can continue to file their complaints before consumer forums,” suggests Ameet Hariani, managing partner, Hariani & Co. However, it should be remembered that a suit can be filed only under one law. In case, at a later date, the state establishes the said authority, the plaintiff cannot file a second case with such an authority, without withdrawing from the first.
Digbijoy Bhowmik, head of policy, RICS, explains, “An aggrieved home buyer can still file a complaint with the district, state or national consumer redressal forum (based on the claim amount). As per a recent ruling of the National Consumer Disputes Redressal Commission (NCDRC), only registered associations of allottees, purchasers, etc., can file such a suit and if the claim amount is over Rs one crore, the plaintiff (i.e., a registered association of allottees, purchasers, etc.) may approach the NCDRC directly. Suits may be filed against promoters or realtors.”
How to handle existing cases, after implementation of the RERA?
Legal experts suggest that once the remaining states appoint a RERA authority, notify the procedure for filing complaints under the RERA and appoint an adjudicating officer, aggrieved consumers may then approach the RERA authority or the adjudicating officer, with their complaints. Home buyers with pending consumer court cases, regarding matters covered under the relevant provisions of the RERA may also, with the permission of the appropriate consumer forum or commission, withdraw the consumer case and file applications before the adjudicating officer or RERA authority.
“As of now, the Consumer Protection Act, 1986, has a far stronger history of case laws and precedents, which can be used by a large variety of litigants, apart from a fairly successful history of litigation. Therefore, it may be a while before a plaintiff makes a ‘switch’ to the new law as grounds for litigation,” explains Bhowmik.
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