States diluting realty act norms to favour delinquent builders

Centre's efforts to bring transparency in housing sector by bringing the homebuyer-friendly Real Estate Regulation Act (RERA) might not yield any results as builders in connivance with state governments are weakening the homebuyer-friendly provisions.

According to official sources, the Ministry of Housing and Urban Poverty Alleviation (HUPA) have received several complaints wherein complainants have alleged that the state governments are removing all such provisions in the RERA Act that hold builders responsible for not meeting the promises made in the purchase agreement.

"The states have either removed all such clauses that empower a homebuyer or have diluted in favour of builders. Some states have 'openly' supported builders as they have notified their law to protect real estate czars instead of aggrieved homebuyers," the official said.

The ministry has sent the complaints to Committee on Subordinate Legislature of the Parliament for final review. Following this, if the panel finds that notified laws are not in compliance with Real Estate (Regulation & Development) Act, 2016, all the provisions would be nullified. "The panel may also order the states to re-notify the act with all stringent provisions," the official said.

In its notification, Gujarat has maintained that the projects that begun after November 1, 2016, will fall under the ambit of the law which is a violation of the Act. On the other hand, final rules of Madhya Pradesh and draft rules Rajasthan and Karnataka are verbatim copies of draft real estate rules uploaded by HUPA on June 24, 2016.

Thus, all gaping holes were finally eliminated in the final rules notified by Centre later on October 31. Similarly, Maharashtra has notified draft real estate rules which have watered down Act's real mandate.

National Convenor Abhay Upadhyay said, "Homebuyers are disappointed as they are being denied justice." On Thursday, Upadhyay in a letter to Modi sought justice for several aggrieved homebuyers.

Cabinet minister M Venkaiah Naidu had also talked tough against the state for diluting Real Estate Act. Also, he warned them of public outcry over dilution of objectives of the act in his letter to chief ministers of all states.