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RERA v. Consumer Courts

Brief Note On RERA And Consumer Courts

The Delhi High Court has held in a batch of petitions moved by several real estate companies (petitioners) against an order passed by the National Consumer Disputes Redressal Commission that remedies available to homebuyers under the Consumer Protection Act (CPA) and the Real Estate (Development and Regulation) Act, 2016 (RERA) are concurrent.

This decision follows the Supreme Court's judgment in the case of Pioneer Urban Land and Infrastructure Ltd. & Anr. v. Union of India &Ors; 2019 SCC Online SC 1005, where the Supreme Court had held that remedies given to allottees of flats/apartments are concurrent and such allottees are in a position to avail remedies under the CPA and the RERA, in addition to triggering the provisions of the Insolvency and Bankruptcy Code, 2016

Difference between Consumer Court and RERA

S.No. Consumer Court RERA
1 Only registered purchasers and allottees can file complaints.

Registered agency/purchaser here means 'any voluntary consumer association registered under the Companies Act, 1956 or under any other law for the time being in force.

On the other hand ‘any of the agencies’ reflects the unregistered association which cannot come within section 2(7)(i)[1] of the act hence cannot file a complaint.
Aggrieved persons can file complaints under Section 31 (1) of RERA Act.
Section 31. (1) - “Any aggrieved person may file a complaint with the Authority or the adjudicating officer, as the case may be, for any violation or contravention of the provisions of this Act or the rules and regulations made thereunder against any promoter allottee or real estate agent, as the case may be.”

For the purpose of this sub-section “person” shall include the association of allottees or any voluntary consumer association registered under any law for the time being in force.
The word “person” is defined under section 2 (zg)[2].
2 A complaint before Consumer Court needs to be filed on a plain paper with documentary evidence. There is a specified format for filing a complaint before RERA.
Every state's RERA official website will have its complaint section and the buyer has to fill in the requisite details in the form prescribed.
3 In the case of a consumer complaint you have to file the complaint depending on the pecuniary limits. District commission can entertain complaints upto Rs. 1 crore and state commissions can entertain complaints only between Rs 1 crore and up to Rs 10 crore;

In case if the value of property is more than INR 10 crore then you will have to approach NCDRC.
You can file a complaint before the regulatory authority of the state where your property is situated. There are no pecuniary limits while filing a claim under RERA.
4 The Central Consumer Protection Authority (CCPA) have an investigation wing, headed by a Director-General, which may conduct inquiry or investigation into consumer law violations, as given under section 15 (1)[3] of Consumer Protection Act 2019.

The CCPA has been granted wide powers to take suo-moto actions, recall products, order reimbursement of the price of goods/services, cancel licenses and file class action suits, if a consumer complaint affects more than 1 (one) individual.
Investigations can be conducted on a complaint by a buyer or suo moto against the builder.
Section 35(1)[4] of the Act empowers the Real Estate Regulatory Authority to make an inquiry and investigate in relation to the promoter, allottee or the real estate agent, as the case may be. “Section 35(1) of the Act provides that the Real Estate Regulatory Authority can either suo moto or on a complain, initiate any inquiry and investigation into allegations against the promoter, allottee or the real estate agent, as the case may be. It is on the discretion of the Real Estate Regulatory Authority to appoint one or more persons to make an inquiry in relation to the affairs of the promoter, allottee or the real estate agent, as the case may be.”
5 Under section 41 Any person aggrieved by an order made by the District Commission may prefer an appeal against such order to the State Commission on the grounds of facts or law within a period of forty-five days from the date of the order, in such form and manner, as may be prescribed.

Under section 51 (1) Any person aggrieved by an order made by the State Commission in exercise of its powers conferred by sub-clause (i) or (ii) of clause (a) of sub-section (1) of section 47 may prefer an appeal against such order to the National Commission within a period of thirty days from the date of the order in such form and manner as may be prescribed:
Provided that the National Commission shall not entertain the appeal after the expiry of the said period of thirty days unless it is satisfied that there was sufficient cause for not filing it within that period.

This implies that the finality of orders is faster under Consumer court
Under Section 43(5)[5] of the RERA Act, 2016 any person aggrieved by an order passed by the Real Estate Regulatory Authority (RERA) can file an appeal. Such an appeal must state the grounds of fact and law on the basis of which the RERA order is challenged.

As stated in Section 44(2)[6] of the Act, the Appeal must be heard and disposed off within sixty days of filing. If this time limit is exceeded, the Real Estate Appellate Tribunal (REAT) will have to give reasons to justify the delay. Thus, the Real Estate Appellate Tribunal is under a statutory duty to dispose off cases in a time-bound manner and not keep them pending.

“Under Section 58(1), any person aggrieved by any decision or order of the Appellate Tribunal, may, file an appeal to the High Court, within a period of sixty days from the date of communication of the decision or order of the Appellate Tribunal, to him, on any one or more of the grounds specified in section 100 of the Code of Civil Procedure, 1908:
Provided that the High Court may entertain the appeal after the expiry of the said period of sixty days, if it is satisfied that the appellant was prevented by sufficient cause from preferring the appeal in time.”

RERA v. Consumer Court

Issue Of Upper Hand
(RERA Or Consumer Court)
Reason
Applicability RERA
  • Dedicated court.
  • Higher probability of faster hearing.
  • Better distributed for claims of any pecuniary limit.
Taking cognizance of infractions by any party RERA
  • Can act on complaints or take suo-moto notice
  • Can conduct investigations
Ease of filing a case RERA Ease of filing cases, with similar expected results as that under the Consumer Protection Act.
Success of litigation More or less similar but the Consumer Protection Act scores better on track record. Good past record of litigation.

End-Notes:
  1. consumer means any person who-
    1. buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment, when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose;
  2. Section 2 (zg) Person includes,-
    1. an individual;
    2. a Hindu undivided family;
    3. a company;
    4. a firm under the Indian Partnership Act, 1932 or the Limited Liability Partnership Act, 2008, as the case may be;
    5. a competent authority;
    6. an association of persons or a body of individuals whether incorporated or not;
    7. a co-operative society registered under any law relating to co-operative societies;
    8. any such other entity as the appropriate Government may, by notification, specify in this behalf;
  3. Section 15 (1) The Central Authority shall have an Investigation Wing headed by a Director General for the purpose of conducting inquiry or investigation under this Act as may be directed by the Central Authority.
  4. Section 35(1) - Where the Authority considers it expedient to do so, on a complaint or suo motu, relating to this Act or the rules of regulations made thereunder, it may, by order in writing and recording reasons therefor call upon any promoter or allottee or real estate agent, as the case may be, at any time to furnish in writing such information or explanation relating to its affairs as the Authority may require and appoint one or more persons to make an inquiry in relation to the affairs of any promoter or allottee or the real estate agent, as the case may be.
  5. Section 43(5) - Any person aggrieved by any direction or decision or order made by the Authority or by an adjudicating officer under this Act may prefer an appeal before the Appellate Tribunal having jurisdiction over the matter:
    Provided that where a promoter files an appeal with the Appellate Tribunal, it shall not be entertained, without the promoter first having deposited with the Appellate Tribunal at least thirty per cent. of the penalty, or such higher percentage as may be determined by the Appellate Tribunal, or the total amount to be paid to the allottee including interest and compensation imposed on him, if any, or with both, as the case may be, before the said appeal is heard.
  6. Section 44(2) - Every appeal made under sub-section (1) shall be preferred within a period of sixty days from the date on which a copy of the direction or order or decision made by the Authority or the adjudicating officer is received by the appropriate Government or the competent authority or the aggrieved person and it shall be in such form and accompanied by such fee, as may be prescribed:
    Provided that the Appellate Tribunal may entertain any appeal after the expiry of sixty days if it is satisfied that there was sufficient cause for not filling it within that period.

    Written By: Mr.Aditya Kumar Upadhyay

    Awarded certificate of Excellence
    Authentication No: AG30886097425-24-820

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