“Repeal TS RERA Rules, Not in Line with Central Act”, Consumers’ Body Demands

Calls for permanent Authority and information sharing mechanism

Team TT

The Telangana Government should immediately repeal the TS RERA rules and replace it with new rules in compliance with the ‘Central Real Estate Rules for UTs without legislatures’, the Forum for Peoples’ Collective Efforts (FPCE), a body representing the pan-India Fight for RERA movement, has demanded.

Criticizing the constitution of an expert committee by the Telangana Government to study the implementation of the Real Estate Regulation and Development Act in neighbouring states as a delaying tactic, a petition submitted by the FPCE Vice President B. T. Srinivasan to the Principal Secretary, Municipal Administration & Urban Development Mr Arvind Kumar, also demanded the setting up of a permanent and fully functional TS RERA Authority, the constitution of an appellate authority and the launch of the TS RERA website immediately.

Responding to the petition by the FPCE, the Principal Secretary said the process of setting up the TS RERA was kicked off a fortnight back in all seriousness with a team of three top planners and an IT expert visiting Karnataka and Maharashtra to understand best practices.  The system will be 100% online-based and the process will be in motion shortly, he added in a social media post. 

In July last year, the state had notified the Telangana State Real Estate (Regulation and Development) Rules, 2017, a set of guidelines governing the real estate sector for effective implementation of the Central Real Estate (Regulation and Development) Act, 2016.

The rules specify guidelines from all real estate issues from defining the projects to the role of real estate agents and promoters and applicable from January 1, 2017 to all projects approved civic bodies including urban development authorities, town and country planning departments, municipal corporations, municipalities and nagar panchayats in addition to the projects notified by the Telangana State Industrial Infrastructure Corporation.

While these rules were not applicable to projects registered prior to January 1, 2017 but still under implementation, the Fight for RERA maintained they were in contravention of the Central Act. Further, the government of Telangana has on January 17 this year notified designation of the Telangana State Vlaue Added Tax Appellate Tribunal as the Appellate Tribunal to manage affairs under the RERA Act till the regular Tribunal is established.

Citing the example of thousands of homebuyers who have allegedly been cheated by prominent builders like the Aliens Group, Aditya Projects, and Lodha to name just a few, the FPCE pointed out that even though it is close to two years since the RERA was enacted Telangana was yet to appoint a permanent RERA and that the continuance of an interim authority was in contravention of the Central Act. Furthermore, the state is also yet to appoint a Real Estate Appellate Authority.

Moreover, there is no system to check new projects approvals, listings and other information in the web site because our Telangana Government is yet to launch fully operational it’s RERA website, Mr Srinivasan added in the petition.

In the recent past, various Writ Petitions had been filed in different High Courts / Benches (Bombay, Nagpur, Aurangabad, Jabalpur, Bengaluru) by builders / associations, challenging the constitutional validity of the Real Estate (Regulation and Development) Act, 2016 (RERA). The Union of India was the main respondent to these WP’s for which they filed a Transfer Petition in the Supreme Court of India under Article 139A of the Constitution to transfer the hearing of all these cases to the Supreme Court.

The Supreme Court, in turn, directed Bombay High Court to hear all matters filed in parts of Maharashtra. Simultaneously, it stayed all other writ petition until the disposal of the WP by the Bombay High Court. The FPCE impleaded in the matter in High Court of Bombay on 6^th of Dec’2017 passed its final judgement and upheld the constitutional validity of RERA.

The final judgement specifically clarified that all “On-going Projects” are covered within the ambit of RERA and has hence upheld Section 3 and its proviso, in totality.

“In view of the said landmark judgement, there is no scope for any state to tinker with the provisions of Ongoing Projects via their state Rules and must adhere to the provisions of Section 3 of RERA,” the FPCE said in the petition addressed to Mr Arvind Kumar.

The RERA Act as envisaged by the Centre aims at ensuring transparency and efficiency in the real estate sector where sale of plot, apartment, building or other real estate is concerned. It seeks to protect the interests of the consumer by establishing appropriate adjudicating mechanisms for speedy dispute redressal.

However, while several state governments initially delayed enactment of enabling mechanisms at the state level, the real estate sector has used it to scare consumers by maintaining the Act would drive up prices of real estate in the country.