Can A RERA Complaint Be Filed Against An Unregistered Project?

According to a Bombay High Court order, Maha RERA will now allow homebuyers to file complaints against unregistered builders and projects. From August 16, consumers will be required to pay ₹ 5,000 for complaints to be accepted by the authority.

In recent years, potential buyers have been concerned about delays in possession and undue cancellation of promised projects.

If a project is delayed for more than five years, the buyer is left in a very precarious and hopeless position, as their dream of owning a house slowly disintegrates. Since there is no mediator, specific rules, swift justice, or large corporations on the other side, the equation between the buyer and the builder has been very one-sided for a long time. RERA changed all that when it was introduced. 

Here’s a look at the instances/cases under which RERA is applicable and how buyers can get justice.

With the Real Estate Regulation and Development Act, 2016, the government aims to prevent builders from taking advantage of loopholes in the old system. However, the RERA isn’t foolproof. While there are certain misgivings in the Act, state authorities are doing all they can to add more teeth to the rules and make them more beneficial to buyers. As per the Minister of Housing, Hardeep Singh Puri, all projects will fall under the Act once the infrastructure required to adjudicate that many cases is available. All types of real estate projects may be covered by the Act, thus extending its applicability.

Maharashtra RERA Laws

Here are a few cases as per the Maharashtra RERA council, wherein the Act has been modified.

Small Projects 

The Maharashtra Tribunal has decided that projects which have a size of less than 500 sq metres or consist of an apartment with fewer than eight flats do not need to register themselves under the Act. This ruling exempted Geetanjali Aman Constructions from registering or having to pay a fine of ₹ 30 lakh.

Covers Long-Term Leases

The Bombay High Court ruled that the Act would extend not just to newly completed or undertaken buildings, but also to long-term leases. Hence, delays in possessions for flats which were booked as per a 999-year lease would also come under the provisions of the MAHARERA Act. Not including such arrangements in the law would jeopardise the entire purpose of the Act, as such leases qualify as a buying of property.

Complaints Against Unregistered Projects

As per ruling by the Bombay High Court, the Maharashtra RERA will enable buyers to file claims against property developers who have not registered themselves under the Act. This also extends to buildings which have not been registered under RERA even if the agent is a registered one. Such complaints will, however, require the payment of a fee amounting to INR 5000, which may be filed via a form from the Source Information category.

Occupancy Certificate

The MAHARERA has also made it mandatory for all developers to provide occupancy certificates within three months of possession. Failure to provide the document will result in a fine which follows an interest-based system, which the developer must pay all the residents. As Mumbai is a sprawling city with over 10,000 apartments without Occupancy certificates, this ruling will help bring order to the prevalent system.

Force Majeure

As per a ruling by the MAHARERA, developers can no longer use the force majeure clause as an excuse for not having the right approvals or for financial crises. Force majeure means unforeseen circumstances that prevent someone from fulfilling a contract. This order came into play in a case which was filed against Lavasa Corporation http://www.lavasa.com. The developer had promised buyers that the apartment would be ready for occupation by April 2014 and had taken the payment for it in 2010. Failure to do so was blamed on a ruling by the environment ministry. The MAHARERA then went on to order the developer to refund the buyer his or her principal and also pay a fine of 10.65 % interest.

Past Projects

The Haryana RERA had ruled that the RERA Act would be applicable to projects which had begun construction before the Bill was passed but finished its development after the law came into force. This gave the RERA the right to adjudicate disputes between the buyer and developer on any project, even ones which began and were completed before the implementation of the Act. The Bench called on Section 11 of the Act which mentions that promoters have to fulfil their promises, as it does not bar plans not listed under RERA. Also, as per Section 34 (f), RERA must ensure that all developers fulfil their obligations to the stakeholders.

Other moves taken by various state authorities such as the inclusion of housing societies as promoters, payment after completion of the project and the removal of developers from a project due to delays have helped buyers find justice easily.

Conclusion 

 It is clear from the examples above that, despite the law explicitly not mentioning unregistered projects and agents, several State authorities are interpreting it to apply to them, as it also doesn’t exclude them. As a result, it is a legal grey area that needs to be clarified in the future for the benefit of the real estate industry.

FAQs

Also, Read:

• About RERA Registration
• How to Get An Online RERA Registration Certificate?