By Bornali Sarmah Goswami, Advocate
Real Estate (Regulation and Development) Act, 2016 is India’s law to bring transparency and buyer protection to real estate. It is special law for real estate sector and it regulates builders, agents and projects.
Key points of RERA:
1.Mandatory project registration: Any residential/commercial project (exceeds 500 sq.meter or more than 8 units/Apartments) must be registered with state RERA before marketing/selling.
2.Escrow Account: Builders must deposit 70% of the money received from buyers into separate escrow account. It prevents misuse of funds by builders and protects homebuyers from fraud.
3.Disclosures: Builder publish plans, approval, timelines related documents in respect of the subject project.
4.Advance Cap: Buyers can pay 10% advance before Sale Agreement.
5.Complaints: Buyers can file complaints in RERA Authority/Appellate Tribunal.
CONSUMER PROTECTION Act,2019: It is general law for all consumers.
Key Points:
- Who is a Consumer: Anyone buying goods/services for personal use-including online, teleshopping, offline shopping and including Homebuyers.
- Focus: Compensation for Consumers.
- Complaints: Consumer can file complaints in Consumer Commission.
*Is Home buyer can file cases in both the platform/forums?
No, you cannot pursue the same case simultaneously in both forums for the same relief. You can choose either RERA or Consumer Court.
When to File in RERA & Consumer Court:
RERA:
- Delay in Possession,
- Builder violated project terms,
- Project under RERA.
CONSUMER COURT:
- Compensation for mental harassment,
- Deficiency in Service,
- Unfair Trade practice,
- Poor construction quality,
- Hidden charges,
- Broader remedies beyond RERA.
*Which Platform/Forum is faster:
In present scenario, RERA is generally faster than Consumer Court-but it depends on the case to case and workload. RERA is only for real estate but Consumer Court handles all types of consumer disputes. RERA-time bound mechanism is within 60 days but Consumer Court follows multiple hearing stages.
*Are the Civil Court and Consumer forums barred from entertaining disputes under this Act?
As per section 79 of the Act civil courts are barred from entertaining disputes (suits or proceedings) in respect of matters which the authority or the adjudicating officer or the Appellate Tribunal is empowered under the Act to determine. However, Consumer Court (National, state or District.) have not been barred from the ambit of the Act.
Current Legal Position:
- RERA does not override Consumer Act.
- Both remedies exist side-by side.
- Buyers has freedom of choice.
- Supreme Court supports dual remedies.
In conclusion, while RERA refers to such individuals as “Buyers” & the Consumer Protection Act recognizes them as “Consumers.”
(Source: RERA Article, Law Journal)