Activists Push for RERA Review Following Supreme Court's Strong Remarks
In Pune, citizen activists have intensified their demands for a thorough reassessment of the Real Estate (Regulation and Development) Act's implementation. This renewed call comes after the Supreme Court, on Thursday, issued sharp criticisms regarding the performance of real estate regulatory authorities across various states.
Thousands of Homebuyers Stuck in Legal Limbo
Activists highlight that numerous homebuyers remain trapped in prolonged legal battles or await the execution of recovery warrants due to inadequate enforcement mechanisms. They argue that the court's observations underscore the necessity to reconsider appointments to RERA bodies. Merely appointing retired officials is insufficient unless these individuals possess the requisite authority, expertise, and administrative capabilities to ensure orders are effectively executed.
Supreme Court Bench Voices Concerns Over RERA Functioning
A bench comprising Justice Surya Kant and Justice Joymalya Bagchi emphasized that it is "high time" states reevaluate and rethink the very constitution of the Real Estate Regulatory Authority. The bench noted that the authority appears to be doing little beyond "facilitating defaulting builders" and expressed significant concern over its operational effectiveness.
Political and Expert Responses to the Court's Observations
When questioned about reviewing appointments, Chief Minister Devendra Fadnavis stated that he had not yet seen the written order and would comment only after receiving it. He cautioned against reacting based solely on media reports, saying, "If something comes in writing, I will study. It would be wrong to say anything based on media reports."
RERA consultant Sanjiv Brar remarked that the Supreme Court's critical observations accurately reflect the ineffectiveness of the RERA Act of 2016. He explained, "The homebuyer is at a clear disadvantage, despite being one of the most important creditors in any real estate project. Data indicates that over 77% of an average Indian household's assets are held in real estate, making it the largest lifetime investment for most individuals."
Brar further elaborated on the dual burden faced by buyers, who not only borrow heavily to purchase homes but also act as financiers as builders collect substantial sums upfront. This situation places buyers in a highly vulnerable position, making them the weakest stakeholders despite their significant financial exposure. He shared a personal anecdote, noting that a close relative is still awaiting recovery from a developer who failed to complete a project, with the revenue department unable to execute the recovery warrant order.
Historical Context and Lack of Deterrence
Brar pointed out that Maharashtra previously had a stronger deterrent under the Maharashtra Ownership Flats Act of 1963. Section 13(1) provided for imprisonment of up to three years, fines, or both for builders violating key provisions. However, the builder lobby, led by Credai, pressured the Maharashtra government to repeal this section. The government complied, disregarding the plight of thousands of homebuyers and granting builders substantial relief. With the removal of criminal liability, there is now no check, deterrence, or accountability, allowing builders to flout the law with impunity.
Additional Criticisms from Activists and Foundations
Godfrey Pimenta of Watchdog Foundation noted that considering the large number of pending cases under MahaRERA, the Act has become ineffective in curbing the conduct of defaulting developers. He stated, "Despite the passing of orders, there is lax enforcement, resulting in flat buyers getting frustrated."
Activist Vijay Kumbhar argued that RERA's failure is not due to a weak law but rather the system implementing it. He emphasized, "There needs to be a check on the appointment of retired bureaucrats as chairpersons. They treat RERA as routine paperwork, no urgency is shown, and there is zero accountability. Officers should be held accountable for enforcement."
