Mumbai : The Real Estate (Regulation and Development) Act (RERA) is quite strict with builders or promoters and agents. But at the same time, it is has punitive provisions for allottees or buyers, said Sulaiman Bhimani, an RTI activist, at a workshop ‘RERA: Effective Complaint Filing & Compliance using RTI & How RERA Conciliation Works’, organised by Moneylife Foundation.
At the workshop, Ajit V Shenoy took the mantle of talking about the conciliation process under the RERA. Shenoy, who works with the Consumer Guidance Cell of the Mumbai Grahak Panchayat, said due to advocacy from consumer organisation, the Central government provided an alternate dispute redressal mechanism, which is turning out to be quite useful for buyers.
According to Bhimani, founder-president of Citizens Justice Forum, under the Law, the promoter or builder or developer cannot advertise, book or sell any plot or flat without registering the project with RERA. “Validity of registration remains till the date of completion as stated by the promoter. However, if the promoter tries to sell flats without registering the project with RERA, he is levied a penalty of more than 10 per cent of the estimated cost of the project.”
However, there are exceptions here. Bhimani added, “If area of the land to be developed is lower than 500 square meters, or number of apartments are less than eight, or where completion certificate is received prior to May 1, 2017, then he is not required to register the project with RERA.”
Provision like Section 12, 13 and14 comes as a relief for buyers. While Section 12 deals with loss sustained due to incorrect or false statement in advertisement or prospectus; Section 13 states if there is no agreement for sale then there is no need to pay advance to the builder; and Section 14, mandates the promoter to adhere to sanctioned plan and no amendment can be made without buyer consent.
Real estate agents are mandated to register with RERA. This is valid for five years and they have to quote registration number in every sale. Under RERA, they are also penalised, added Bhimani, who had exposed several illegal constructions, corruption and land deals relating to SRA and MMRDA, added.
Talking about responsibility of buyers, Bhimani said, “Under Section 19, buyer has to make payments as per the manner and time fixed in the agreement for sale. Any delay in payment of these charges can attract payment of interest.”
Before RERA, the affected buyers could only approach the court or consumer forums under the provisions of the Maharashtra Ownership of Flats Act (MOFA) or the Consumer Protection Act 1986. “At present thousands of cases are (still) pending in various courts across Maharashtra,” Shenoy revealed.
Interestingly, consumer organisations during formation of RERA had advocated alternate dispute resolution mechanisms in order to get quick dispute resolution for the affected parties, at a cost-effective and timely manner. This was granted through Section 32 (g).
Shenoy stated, “To meet the above obligation Maharashtra RERA (MahaRERA) has set up 10 conciliation benches in Mumbai and five in Pune. Each bench consists of a member each from real estate developers’ organisations and one member from a recognised consumer organisation.” For the Mumbai and Pune benches National Real Estate Development Council (NAREDCO), Maharashtra Chamber of Housing Industry (MCHI) and Confederation of Real Estate Developers Association of India (CREDAI) are chosen as representing the developers and Mumbai Grahak Panchayat (MGP) has been chosen to represent consumers. “Similar benches will be formed in other major cities of Maharashtra progressively based on need,” added Shenoy.
The conciliation application process has started from February 1, 2018 and the first conciliation hearings have taken place both at Mumbai and Pune on March 10, 2018. More aggrieved people will tend to use the conciliation mechanism. The duration of the process of conciliation should not exceed 45 days and should be completed in maximum three hearings as, unlike what happens in normal courts, no adjournments are allowed for paltry reasons. He said, “Also as the cost is only Rs 1,000 it is quite affordable for a common man and no legal fees are involved. This is expected to reduce the number of pending cases in the courts.”
