Housing Ministry Moots Mechanism For Homebuyers’ Refunds

In a significant move aimed at effective resolution of aggrieved homebuyers’ grievances, the Ministry of Housing & Urban Affairs (MoHUA) has called upon state-specific real estate regulatory authorities to set up an effective mechanism for ensuring compliance of orders of RERA authorities by developers for refunding homebuyers’ dues, on the lines of Gujarat RERA.

This follows the ministry’s earlier exercise , asking six RERA authorities of Gujarat, Tamil Nadu, Maharashtra, Uttar Pradesh, Haryana and Karnataka to suggest ways to ensure  timely execution of refund orders issued by RERA authorities . This move by MoHUA will ensure adoption of a uniform pan-India system by RERA bodies to appoint a recovery officer to ensure that refund orders issued by RERA authorities are complied with by the developers, much to the relief of aggrieved homebuyers.

RERA Gurugram Move to Provide Relief to Homebuyers of Stalled Projects

In a first of its kind move , Gurugram bench of Haryana RERA swung into action with a survey of stalled housing projects, aimed at speeding up home completions and putting an end to the woes of thousands of aggrieved homebuyers.

This action  follows the failure of aggrieved homebuyers to get relief from various regulatory authorities. They have been demanding action against the developers for not complying with licence conditions and not giving possession of homes. In the light of this, H-RERA Gurugram Chairman, Arun Kumar along with his team, conducted  a field survey to know the ground reality of project delays and finding a meaningful solution of homebuyers’ problems.

Most of the stalled projects are in the affordable category. These include Mahira Homes’ projects in Sectors 63,68, 95, 103,104 Gurugram and OSB Developers’ projects in Sector 69, 70, 109 Gurugram Besides these affordable housing projects, other stalled projects under the scanner of H-RERA Gurugram include Raheja Revanta in Sector 78 and Orris Greenopolis in Sector 89. It is worth mentioning that last year H-RERA Gurugram had ordered a forensic audit of some stalled projects following allegations of irregularities in procuring licenses.

RERA- What it All Needs to Make It More Effective

After more than six years of its implementation, the Real Estate Regulation Act (RERA) has covered a lot of ground in terms of regulating the sector to ensure fair and transparent residential transactions. However, besides the basic shortcomings of not covering commercial real estate and secondary markets, there are still some flaws in the Act which needs to be amended to make it much more effective to serve the basic purpose of redressing the grievances of home buyers. Torbit Forum highlights the shortcomings   of RERA and amendments required to further strengthen it in order to increase its efficacy.

Vinod Behl

Anita Karwal, Chairperson, Gujarat RERA

Post-2017, there is much better regulatory compliance by new projects, though pre-2017 legacy problems exist. Builders work through consultants, architects and chartered accountants who are not updated about RERA. As per quarterly report, there are 900 non-compliances and 880 promoters had no idea of it  as they were not updated. Another issue is that redevelopment projects do not come under the purview of RERA.These redevelopment projects need to be covered under RERA. There is a provision for reconciliation under RERA. Naredco can play an important role in this regard to ensure that cases are first tackled at the level of developers before they come to RERA.

Anand Kumar, Chairman, Delhi RERA

Though in case of new projects, we  find out the cause of delay and check it at an early stage , the problem is with legacy projects where promoters have gone insolvent. We should tackle insolvency on a stand-alone basis.  We also find that the developers of mid-sized projects-500 sqm plus are not coming forward to register. Then there are issues pertaining to cheque and non-cheque payment. We can’t take action with regard to agricultural land where policies have not come up. Various amendments in RERA law are necessary for streamlined and effective working of RERA.

Gokul Mohan Hazarika, Chairperson, Assam RERA

We have 751 real estate projects registered under RERA- far behind others. We have received 250 complaints out of which we are able to dispose of 150 complaints. Builders were initially reluctant for various compliances but gradually they are coming around. But we find cases where land orders are not in order and there are defects in land titles which add to the woes of consumers. There are also cases of NOCs issued without certain compliances. Developers should create a mechanism to resolve problems at their end to save time for the redressal of consumers’ grievances.

Pradeep Kumar Biswal, Member Odisha RERA

Planning authorities approve projects but we find that in some cases there is a lack of due diligence which creates problems. The biggest issue is the execution of RERA rulings. RERA has no civil power. As such RERA authorities depend on civil courts to get their orders executed. In order to get their refund orders executed, RERA has no option but to refer the matter to district magistrates.Moreover, there is a need to have a uniform system in terms of local laws across states. The Ministry of Housing and Urban Affairs should come forward for this. Orissa has brought in the Apartment Compliance Act in consonance with RERA.

Harshvardhan Bansal, President, NAREDCO Delhi Chapter

RERA has improved the real estate regulatory landscape Initially, there was a myth that RERA was against developers. Actually, it is there to regulate builders, consultants and buyers for the purpose of overall regulation of the industry. But still there are certain issues which need to be tackled. The issue of multiple registrations of real estate consultants across states still remains unresolved. Real estate brokers should be permitted to do business across India under ‘One nation, One license’. Developers should self-regulate and have constant communication with RERA authorities. If they file the required information honestly and transparently, their projects will be automatically regulated. We have initiated a programme to help developers to ensure better compliances.