The Supreme Court judgment has elucidated the constitutional viability and scope of RERA. This judgment will set a new touchstone for state-specific RERA authorities. Although, it is quite difficult to give words about the apex that the court has set for builders to follow the rule book.
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On 11th November, the Supreme Court made a landmark judgment in the long-awaited Newtech Promoters & Developers versus UP State Authority. The Constitutional validation of the challenged RERA provisions was put forward.
The high court resolved the principle of law through its judgment against the appeals made by the UP RERA jurisdiction. The fact is, RERA keeps on updating the significant rules to cope with the changing market trends. But being the most volatile real estate market, builders registered with UP RERA always found a way to challenge legal jurisdictions passed by the RERA authority.
The Real Estate Regulatory Authority of Uttar Pradesh is a hotspot of consumer grievances. From delayed projects to defaulters UP RERA tops the list. About 40 percent of the homebuyer grievances across India have been filed in this market alone. Thus, without any doubt, if the authorities take a step to clean up the real estate sector, the builders find their own way to escape and oppose the passed order.
Although, builders are quite familiar with the RERA principles, yet they never fail to surprise the law by challenging the passed orders. The sole plan behind all such activities is to delay the consumers’ justice. Builders are conscious of the bitter truth that at least 10 out of every 1000 buyers get the settlement in their favor and this opens the door of hope for other buyers too.
As a result, repeatedly, the RERA’s jurisdiction is challenged by the builders to keep pushing the orders and delay justice. This somehow harasses the homebuyers who keep on waiting for the court verdict in their favor.
Well, Supreme Court puts an end to all such activities by passing the below-mentioned judgments:
- The constitutional validity of the Real Estate Regulatory Authority has been upheld
- Only the projects will be considered as ongoing ones whose completion certificate has not been obtained before 1st May 2017.
- RERA Act,2026 is retroactive
- Pre-existing agreements correlated with RERA will be considered subject to retroactive application. As a result, all the Act and RERA rule provisions will prevail. Accordingly, the interest rate will be levied on the ongoing judgments
- Jurisdiction for buyer’s refunds together with the interest thereon as well as interest associated with the delayed possession will be Authority’s decision
- Jurisdiction to decide the applicable compensation will completely lie with the Authority
- Delegation of powers for deciding the RERA complaints as per Sections 12,14,18 & 19 towards a member is upheld
- The right to issue project Recovery Certificates is upheld
As per the legal adviser of UP RERA, Venket Rao, this Supreme Court judgment has put a lid on one go on such issues. According to Venket Rao, RERA rules were having certain gray areas and builders were constantly challenging them for their own benefits.
Although, even after the judgment, certain questions have been left unanswered. The law is crystal clear when it comes to legal jurisdiction and has clarified that nothing new is going to be added in this order. The major issue was the intent of builders of challenging the principles to lengthen up the ongoing legal battle.
People have set their hopes to receive a verdict on the unanswered questions including
Will this judgment actually put an end to the long-drawn-out litigation?
Is RERA just a back door of litigation and cant be seen as a doorstep to justice for homebuyers?
What options are available for the homebuyers if the project builder keeps on challenging the RERA orders in the Supreme Court?
The landmark judgment passed by the Supreme Court only defines the Constitutional validity of RERA together with the RERA ambit. A lot is yet to be answered.
