Mumbai: The Real Estate (Regulation and Development) Act 2016, which is usually seen as being pro-buyers, offers a range of provisions for the promoters of real estate projects.
In the case of reviving a stalled project, the RERA allows the promoter to set a new time frame, which is reasonable to complete the project after registering with RERA.
Despite the delay in the project, the promoters get sufficient time to fulfil fresh commitments without being liable to pay penalty for going past the period specified by them in the contractual agreement with the buyer.
A division bench of justices Naresh Patil and Rajesh Ketkar is hearing objections of builders and promoters challenging the RERA Act on the directions of the Supreme Court, which asked the Bombay high court to hear petitions, intervention applications and the government’s say on the Act and decide on it within two months.
The HC while hearing the intervention application by NGO Forum for People’s Collective Efforts (FPCE) informed the court that the objections of builders and promoters were baseless as there were provisions in the Act that would enable them to complete stalled projects without being liable to pay any penalty for the delay in projects.
Advocate Shiraz Rustomjee for the FPCE said that the opposition to include ongoing or stalled projects was unnecessary.
“The Act in section 3 and 4 (2) (l) (c ) specifies various provisions for a promoter that not only gives him a new lease of life but also does not burden him with any additional financial obligation till the new reasonable time period he has specified to RERA for completion of the project,” said Mr Rustomjee.
He said that if a promoter had undertaken to hand over possession of an apartment in 2015 as per the contractual agreement with the buyer but missed it. When he registers with RERA and specifies a reasonable time period for handing over possession then he is not liable to pay any penalty or compensation to the buyer. But the same becomes effective if he misses the new time period.
