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Supreme Court’s order on Regarding Real Estate Regulations Act (RERA)

Supreme Court's


The Supreme Court recommended a few alterations to the Real Estate Regulatory Authority Act (RERA) in order to safeguard the rights of people purchasing homes. The ruling may force changes in state rules modelled on this Act.

What are the broad contours of the ruling?

The highest court has ruled that the Real Estate (Regulation and Development) Act (RERA) can be applied retroactively. This means it covers all projects that didn’t have completion certificates when the Act came into effect. This decision confirms that RERA applies to all projects that were already underway when the law was introduced. As a result, many states that had watered down RERA rules might need to change them to make sure ongoing projects comply with the law. State authorities will now have to consider and possibly take action against projects that were previously exempt from RERA.

What are the impacts of ruling on the RERA Act?

This decision by the Supreme Court supports homebuyers, safeguards their rights, and instructs developers to follow RERA regulations. Supreme Court rulings can be grouped into three categories, as outlined below.

Retroactive application of RERA

This means that RERA will now cover construction projects that were already in progress when the Act came into effect, and where completion certificates hadn’t been issued. This move opposes the states that had previously relaxed RERA rules to exclude such projects.

Jurisdiction under RERA

The highest court has determined that RERA holds the exclusive power to enforce actions like refunding money with interest for delays, ensuring on-time possession, and imposing penalties and interest on developers, all for the benefit of homebuyers.

Faster Dispute Resolution

To make the process more efficient, the Supreme Court has made it a requirement for developers to deposit at least 30% of the penalty imposed by the regulator before they can challenge any RERA decision in the High Court. This change aims to reduce the time homebuyers have to wait for resolution due to lengthy legal procedures and appeals.

What are the Implications of the Judgment?

  • For States: Several states that had made changes to the RERA rules might need to adjust them once again.
  • For Homebuyers: This could lead to a more effective way of resolving complaints and a consistent set of rules that apply to all states.
  • For Developers: Developers are now required to register projects that were already in progress when the Act was initiated.

Read Also: Crisis in State Administrative Services

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