The Real Estate Sector even with the expanding opportunities has continuously suffered due to lack of professionalism and absence of minimum standards of functioning that ensures a balanced relationship between the builders, promoters, buyers and other parties of the sector.
These shortcomings became the foundation stone for the enactment of the Real Estate Authority (Regulation and Development) Act (hereinafter referred to as “RERA Act”), enacted on May 1, 2016. Preamble to the Act iterates its core value of regulation and promotion of the Real Estate sector and the establishment of a transparent and efficient system with the primary motive of safeguarding the rights and interests of the buyers.
Alongside the provisions, Section 79 of the RERA Act discusses the bar to jurisdiction. It bars any civil court to entertain a matter that can be tried by the authority established under this Act. Thus, a conflict over the choice of redressal mechanism for the aggrieved party arose. This conflict was put to rest by the Hon’ble National Consumer Disputes Redressal Commission (hereinafter referred to as “NCDRC”) in the case of “Ajay Nagpal Vs. Today Homes & Infrastructure Pt. Limited” (Consumer Case No. 1764 of 2017).
The Hon’ble NCDRC compared the two enactments and opined that the Consumer Protection Act 1986 (hereinafter referred to as ‘CPA’) aims for protection of Consumer rights while the RERA Act aims at providing efficient consumer protection to the Real Estate Sector. They observed that Section 3 of the CPA, stated that the Act operates in addition to and not in derogation of any other law; its sole purpose is to make available a speedy and proficient grievance redressal mechanism.
The Hon’ble Bench further clarified that the authority under the CPA cannot be understood to be a ‘Civil Court’ since the Act is a special enactment to provide special remedy to the aggrieved consumers. Therefore, the consumers would still have the liberty to choose the forum to approach for grievance redressal.
Additionally, the order clarified that the obligations of the promoters under Section 14, 15, 18 and 19 in RERA Act do not derogate the buyer’s right to approach the Consumer Forum. Similarly, Section 71 which allows the withdrawal of a complaint filed before the Consumer Forum and filing it before the authority established by the RERA Act would not be an express bar on the jurisdiction of the Consumer Forum.
Claims of the Opposite Party were also rejected by the Hon’ble Commission stating that if an arbitration proceeding can be initiated it would restrain the Consumer Forum from proceeding with the complaints.
A consumer however, cannot approach multiple authorities to seek remedy over the same subject matter. The consumer also must bear in mind that in order to approach the Consumer Court the pecuniary jurisdiction of the dispute amount must be adhered to. Similarly, when approaching the authority under the RERA Act it should be such relevant authority that practises the territorial jurisdiction over the matter.
Thus, the availability of a specialised authority under the RERA Act does not restrict the choice of a consumer to move to the Consumer Court. This decision has further been upheld in 2019 case of STUC Awasiya Grahak Kalyaan Association and Ors v. Supertech Limited (Consumer Case No. 2335 of 2017) upon the conflict arising with regard to the jurisdiction of the Commission to hear the case. Here too, following the principle laid down in the Today Homes and Infrastructure Pvt. Ltd. the Hon’ble NCDRC opined that jurisdiction did exist as the Commission was not a ‘Civil Court’ as under Section 79 of the RERA Act 2016.
A similar stand was taken in the case of Nilabh Parimal & Ors. Vs. Unitech Limited (Consumer Case No. 3690 of 2017) that was bought before the Hon’ble NCDRC in 2019 as well.
Therefore, as of now, as affected consumers look out for continued remedy from the consumer courts, RERA will need to emerge as the most efficacious remedy for a home buyer for fulfilment of obligations by developers under the RERA Act. The discussion on the issue not over yet as it will be required to clinically earmark the scope and ambit of relief to homebuyers under RERA Act in times to come.
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