RESEARCH PROJECT

On
‘Analysis of powers and functions of Real estate regulatory
Authority”
Submitted to

MAHARASHTRA NATIONAL LAW UNIVERSITY, AURANGABAD

Submitted by

Paras Nagrare

B. A.LL.B. (Hons.) Semester-X

Roll No. 2019/BALLB/49
Subject: Real Estate Laws

Under the guidance of

Ms. Priya Gondhalekar & Supriya Bohra
Visiting Faculty of Law

Maharashtra National Law University, Aurangabad

April, 2024

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 Table of Contents
Declaration................................................................................................................................3
1 Abstract..............................................................................................................................4
2 Introduction.......................................................................................................................5
3 Salient features of the Real Estate (Regulation and Development) Act, 2016................6
4 Responsibilities of the appropriate Government..............................................................8
5 Establishment and incorporation of Real Estate Regulatory Authority (Section 20)....9
5.1 Term of office of the Chairperson and members (Section 23).................................9
5.2 Removal of the Chairperson and members from office in certain
circumstances (Section 26)...................................................................................................9
6 Powers of the Regulatory Authority................................................................................11
6.1 Responsibilities of the Regulatory Authority...........................................................11
7 Analysis of the effectiveness of the council....................................................................12
Keeping up the federal spirit...............................................................................................12
Representation of environmental concerns........................................................................12
Regularise interactions –....................................................................................................12
8 The Real Estate Appellate Tribunal................................................................................13
9 Establishment of Real Estate Appellate Tribunal (Section 43).....................................14
9.1 Powers of the Appellate Tribunal (Section 53).......................................................14
9.2 Power to make regulations (Section 85).................................................................15
10 Analysis of the establishment of the tribunals............................................................15
11 Judicial Insights...........................................................................................................17
11.1 Geetanjali Aman Constructions v. Hrishikesh Ramesh Paranjpe.........................17
11.2 Mr. Jatin Mavani v. M/s. Rare Township Pvt. Ltd, 2018.......................................17
11.3 Sushil Ansal v. Ashok Tripathi, Saurab Tripathi, 2020.........................................18
11.4 Baldev Singh v. Ultratech Township Developers Pvt Limited, 2020......................18
12 Conclusion...................................................................................................................19

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 Declaration

This declaration is made at Aurangabad that this project is prepared and drafted by
Paras Nagrare.

It contains the project work that was assigned to me during my 10 th Semester period,
and accomplished from my side.

This project is a sincere attempt at the compilation of the aforementioned work.

This has not been submitted, either in whole or in part, to any other Law University or
affiliated Institute under which any University is recognized by the Bar Council of
India, for the award of any other law degree or diploma, within the territory of India.

Paras Nagrare
2019/BALLB/49

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 1 Abstract

This analysis explores the powers and functions of the Real Estate Regulatory Authority
(RERA), a regulatory body established in India to govern the real estate sector. The paper
examines the various authorities vested in RERA, including promoting ethical practices
within the industry, safeguarding the interests of homebuyers, and ensuring the swift
resolution of disputes. It further delves into RERA's functionalities, encompassing the
registration of real estate projects, regulation of builders, and grievance redressal
mechanisms for homebuyers. In conclusion, the analysis argues that RERA plays a pivotal
role in fostering transparency and accountability within the real estate sector.

Objectives of the Study:

 To understand the legal framework that establishes RERA and its role in the real
estate sector.
 To examine the specific powers vested in RERA to regulate real estate activities.
This may include areas like project registration, developer accountability, and agent
oversight.
 To assess how RERA functions to protect the interests of property buyers and
investors. This could involve examining complaint redressal mechanisms and
enforcement actions.
 To evaluate the effectiveness of RERA in promoting transparency and accountability
in real estate transactions. This might involve analyzing factors like project
information disclosure and financial management regulations.
 To identify any challenges faced by RERA in implementing its regulatory mandate.
This could include issues like resource limitations, bureaucratic hurdles, or gaps in
the legal framework.

Research Methodology:

The nature of the research paper is primarily descriptive and analytical. The secondary data
used in this paper such as relevant books, published Articles and RERA Act, Bill. The data is
collected as per used from the secondary sources. This paper follows the interpretative
approach of analyzing the data.

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 2 Introduction
The real estate sector is an important component of the economy and plays a catalytic role in
meeting the country’s housing and infrastructure needs and demands. While this sector has
grown significantly in recent years, it has been largely under-regulated with the absence of
standardisation and lack of adequate buyer protection. Though the Consumer Protection Act
of 2019 provides a forum for real estate buyers to address their concerns, the option is only
curative and does not adequately address all the problems of buyers and promoters in that
sector. The absence of uniformity has been a constraint to the healthy and orderly growth of
the industry. Therefore, the need for regulating the sector has been accentuated in various
forums.

Why RERA ? The implementation of RERA was to bring in uniformity and transparency.
Before the RERA, there had been many issues between the consumer and the suppliers. They
had to face a lot of problems, but at the same time they could not do anything about it as there
were no proper rules and regulations. The consumers were the ultimate to suffer all these
issues and the delay has been the biggest problem. there are few more issues faced and hence
this act was enforced

 Security: The money received from a project will remain in the respective escrow
account, that is each project will have a different account and any payment made for
the project related will be made only in that particular account.
 Transparency: It is important for the buyer to submit all the proof and documents for
all the projects they take. The builders can not make any changes without the consent
of the consumers. This helps in bringing a smooth transaction.
 Fairness: RERA has now set up the carpet area, built up area but not super built up
area. If there is any delay in the completion the builders are entitled to bare the
expenses for the delay.
 Quality: The builders are entitled to rectify any default within 5 years of the purchase.
The issue must be rectified within 30 days.
 Authorisation: Registration is important, without the registration a regulator can not
advertise or sell the buildings.

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3 Salient features of the Real Estate (Regulation and Development) Act,
2016

1. To regulate and promote the real estate sector by establishing the Real Estate
Regulatory Authority.

2. To carry out the sale of plots, buildings or apartments as the case may be, or the
sale of all the real estate projects transparently and efficiently.

3. To protect the interests of the consumers and buyers and ensure the prevention of
malpractices against them.

4. To establish adequate and speedy dispute redressal systems and also establish
Appellate Tribunals to hear and adjudge appeals from the orders, directions or
decisions of the Real Estate Regulatory Authority.

5. Establishes state-level regulatory authorities called RERA.

6. To work on residential real estate projects and register all the projects that are to be
undertaken without which the promoters cannot promote or sell.

7. To cast duties on the promoters to upload details of the project on the website
including layout and site plans.

8. To ensure that two-thirds of the allottees give their written consent in addition to
RERA’s written approval when a promoter has to transfer or assign a majority of
the rights and responsibilities in a real estate project to a third party.

9. To ensure that the buyer or promoter, as the case may be, pays an equal sum in the
event of any default.

10. Where the promoter causes the buyer any loss as a result of other people claiming
property (defective title of property) that has been built or is being built, the
promoter shall be liable to pay compensation to the buyer.

11. To ensure that the money collected from project buyers must be kept in a separate
bank account and utilised solely for the construction of the project. This sum is
subject to change by the State Government.

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12. The Act provides the right to legal representation on behalf of the client by a CA,
CS or CMA or legal practitioners

13. It imposes a stringent penalty on promoters, and real estate agents and also
prescribes imprisonment.

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 4 Responsibilities of the appropriate Government

 Notify the rules for the implementation of this Act, within six months of
commencement of this Act.
 Establish the Real Estate Regulatory Authority, within one year of commencement of
this Act, ie., latest by 30th April 2017.
 Shall depute an officer, preferably, a housing secretary as an interim regulatory
Authority.
 Establish the Appellate Tribunals within one year from its commencement, ie. ,
maximum by 30th April 2017.
 Identify an existing Appellate Tribunal for the time being established under any other
law in force, as the Appellate Tribunal until a full-time Appellate Tribunal is
established.
 Appoint members of the Appellate Tribunal and the Chairperson and members of the
Regulatory Authority based on the suggestions and recommendations of the Selection
Committee.
 Appoint employees and other officers of the Regulatory Authority and the Appellate
Tribunal.
 Identify and establish office space and other infrastructure for its functioning.
 To constitute the Real Estate Regulatory Fund, 2017.
 The Central Government is required to establish the Central Advisory Council.

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 5 Establishment and incorporation of Real Estate Regulatory
Authority (Section 20)
Within one year of the date of enactment of this Act, the competent government shall, by
notification, create a body to be known as the Real Estate Regulatory Authority to exercise
the authorities conferred on it and perform the responsibilities assigned to it under this
Act. Provided that the appropriate government of two or more states or union territories may,
if it so chooses, establish a single authority, provided the relevant government may, if it so
desires, establish multiple authorities in a state or union territory:

Provided that until a regulatory authority is established under this Section, the competent
government may by order nominate any regulatory authority or any officers, preferably the
Secretary of the department dealing with housing as the regulatory authority to discharge the
functions under the Act.

5.1 Term of office of the Chairperson and members (Section 23)

The Chairperson and Members shall serve for a term of five years from the date of their
appointment or until they reach the age of sixty-five years, whichever is earlier and shall not
be eligible for re-appointment. Before selecting anybody as a Chairperson or member, the
competent government must be satisfied that the person has no financial or other interests that
might jeopardise his or her duties as a member.

5.2 Removal of the Chairperson and members from office in certain

circumstances (Section 26)

In accordance with the notified procedure under this Act, the appropriate government shall
remove the Chairperson or other members from office if either of them –

 has been declared adjudged insolvent,

 has been convicted of an offence involving moral turpitude, or
 has become incapable, either physically or mentally to act as a member, or
 has got any financial or other interest which may prejudice exercising his power as
Chairman or other members.

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1. The Chairperson or member shall not be removed from office for the reasons
specified in clauses (d) or (e) of sub-section (1) unless the appropriate government
orders it following an inquiry conducted by a High Court Judge in which the
Chairperson or member has been informed of the charges against him and has been
given a reasonable opportunity to be heard on those charges.

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 6 Powers of the Regulatory Authority

 Power to issue interim orders – Section 36 of the Act says when the Authority is
satisfied that an act in violation of this Act or the rules and regulations thereunder has
been, is being, or is about to be committed, the Authority may, by order, restrain any
promoter, allottee, or real estate agent from carrying on such act until the conclusion
of the inquiry or until further orders, without giving such party notice, if the Authority
deems it necessary.
 Power to issue directions – Section 37 of the Act says the Authority may provide
such instructions to the promoters, allottees, or real estate agents, as the case may be,
as it deems necessary to carry out its powers under the provisions of this Act or rules
or regulations adopted thereunder and such directions shall be binding on all parties
concerned.
 Power to rectify the orders – Section 39 of the Act says the Authority may alter any
order passed by it at any time within two years of the date of making of the under this
Act, in order to correct any mistake obvious from the record and shall make such
amendment if the mistake is brought to his notice by the parties. Provided, no such
alteration shall be made in respect of any order to which an appeal under this Act has
been filed. Furthermore, the Authority shall not change any substantive portion of its
order issued under the provisions of this Act while correcting any mistakes obvious
from the record.

6.1 Responsibilities of the Regulatory Authority

1. To facilitate registering the real estate project and real estate agents.

2. To extend the registration of the real estate or project and its revocation.

3. To renew or revoke, as the case may be, the registration of the real estate agent.

4. To maintain a website of records for public reviewing.

5. To appoint more than one adjudicating officer for addressing the issues relating to
real estate matters.

6. To notify rules and regulations.

7. To recommend for any growth and promotion of healthy and transparent

functioning of the project.

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 7 Analysis of the effectiveness of the council

The Central Advisory Council is in charge of predicting and improving the RERA’s
implementation efficiency. More importantly, the council must endeavour to improve the real
estate sector as it is a significant contributor to the country’s GDP. While the goal has been
stated, the following areas must be thoroughly investigated for this council to make a
significant change.

Keeping up the federal spirit – To maximise the efficacy of this Council, it is necessary to
have representation from all of the states to avoid leaving any area unrepresented. Currently,
the Council is made up of five states that are chosen on a rotational basis. This denies the rest
of the states the ability to express their views. The representation should include not just
those states that are now doing well in the real estate business, but also those that are not
doing so well but have the potential to do so. As a result, state representations should be
increased to at least ten to fifteen states.

Representation of environmental concerns – Consumer interests are not restricted to money

in real estate, thus environmental issues should be strongly represented on the CAC.
Consumers are also interested in environmentally sustainable models, which should be
adopted by real estate developers. The CAC may assist in promoting excellent practices in
real estate developments, which will motivate promoters to go green and adopt green
alternatives while executing such projects. As a result, both the promoters and the consumers
will profit from it.

Regularise interactions – The RERA meetings must be held on a more regular basis to avoid
the RERA becoming a “paper tiger.” This will also keep the RERA from becoming more
diluted. The most recent meeting took place on May 18, 2018. As a result, laws must be
enacted to make the meetings mandatory at least once a year. Regular interaction is required
for representations to work.

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 8 The Real Estate Appellate Tribunal

Real Estate Appellate Tribunal is formed by the Appropriate Government under Chapter VII
of the Real Estate (Regulation and Development) Act, 2016 to ensure faster resolution of
disputes. Parties aggrieved by the RERA order can appeal before the Real Estate Appellate
Tribunal and it has to adjudicate such cases within sixty days. Civil Courts have been
prevented from exercising jurisdiction on such matters. If any of the parties is not satisfied
with the Real Estate Appellate Tribunal order they can file an appeal against the order of the
Real Estate Appellate Tribunal order to the High Court within sixty days.

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 9 Establishment of Real Estate Appellate Tribunal (Section 43)

The appropriate government, shall within one year of commencement of this Act, by
notification, establish a Real Estate Appellate Tribunal. There shall be one or more benches
of the Appellate Tribunal, for various jurisdictions in the state or union territories, if the
appropriate government deems necessary. Every bench of the Appellate Tribunal shall consist
of at least one Judicial Member and one Administrative or Technical Member.

The Act also allows for the establishment of a single appellate tribunal for two or more states
or union territories. The designated tribunal may hear cases until such a tribunal is
constituted and once the tribunal is constituted, all the existing cases will be transferred to the
newly established common Tribunal. If the appropriate government of two or more states or
union territories deems it necessary, may establish a single Appellate Tribunal.

It may be noted that when 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 or with both, as the case may be before the said appeal is
heard.

9.1 Powers of the Appellate Tribunal (Section 53)

The Tribunal is not bound by the Code of Civil Procedure of 1908 or the Indian Evidence
Act of 1872, which impose strict procedures. It shall be guided by the principle of natural
justice and also has the authority to regulate its own procedures. However, the Chairperson
has administrative powers under the Act as he has been provided with powers of general
superintendence and direction during the time of their conduct in the affairs of the tribunal
and all the orders passed by the tribunal are to be executed as a decree of a Civil Court. The
powers of the civil court are entrusted to the Tribunal which includes the following –

 Summoning and enforcing the attendance of any person and examining him on oath;
 Requiring the discovery and production of documents;

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  Receiving evidence on affidavit;
 Issuing commissions for the examination of witnesses or documents;
 Reviewing its decisions;
 Dismissing an application for default or deciding it ex-parte, setting aside any order of
dismissal of any application for default or any order passed by it ex-parte; and
 Any other matters as the Authority may specify by regulations.

9.2 Power to make regulations (Section 85)

The Authority shall, by notification, enact regulations consistent with this Act to carry out the
purposes of this Act within three months of its establishment, by notification. Without
prejudicing the generality of the foregoing power, such regulations may provide for all or any
of the following:

1. The form and manner of making an application and the fee payable therewith
under Section 4(1);
2. The form of application and the fees for extension of registration;
3. Documents required under Section 11(1)(f) of the Act;
4. Exhibition of layout plans and sanctioned plans along with specifications, approved
by the competent authority under Section 11(3)(a) of the Act;
5. Preparation and maintenance of other such details under Section 11(6);
6. Time, places, and procedure for transaction of business in the meetings of the
Authority under Section 29(1);
7. The form and manner along with the fee payable for filing a complaint under Section
31(2) of the Act;
8. Standard fee to be levied on the promoter, the allottees or the real estate agent
under Section 34(e); and
9. Such other matters which are required to be specified by regulation.

10 Analysis of the establishment of the tribunals

When it comes to the establishment of Appellate Tribunals and related tasks, there have been
some aspects that require attention. The following are some of them:

Real Estate Appellate Tribunals have not been formed in all Indian states and union
territories. Appellate Tribunals have been formed in 22 states, with 13 permanent and 9

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interim tribunals. The states must establish permanent authorities and Appellate Tribunals to
better execute the Act and reduce the burden on the district courts.

There was a petition raised in the Gujarat High Court to ensure that the tribunals are
constituted as per the Act. Because the Appellate Tribunal lacked technical members, it was
called “Coram non-judice.” Technical members must be recruited since the real estate
business necessitates specialised knowledge that judicial members may lack. Real estate is a
vital national asset. The goal of the Act will be defeated if the Tribunal becomes
bureaucratized. Other difficulties were noted as well, such as the Appellate Tribunal’s failure
to give information on the number of appeals filed, pending appeals, and so on. To avoid
further dilution of the RERA, it is necessary to guarantee that the institutions involved are
given sufficient autonomy to function efficiently and that additional bureaucratisation is
avoided. Important factors such as vacancies not being filled or appointments not being made
impede institutions and contribute may defeat the objectives of the Act.

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 11 Judicial Insights

11.1 Geetanjali Aman Constructions v. Hrishikesh Ramesh Paranjpe

Issue – In this case, the issue was about project registration and the dispute was with regard
to Section 3 of RERA. The most essential rule in this regard was Section 3(2), which stated
specifically that projects are not necessary to be registered if their area does not exceed 500
square metres or if the building does not have more than eight storeys.

Arguments – Even after arguing that it is an “or” condition and not a “and” condition, the
defendant failed to get the desired result. The argument put forward stated that the first
condition that it must be within 500 sq meters. is satisfied, while the allottees have filed that
since there are approximately 22 flats and 9 shops, it violates the second condition The
question before the court was to interpret Section 3(2) and it held that Section 3(2) will be
interpreted in its truest sense now and that the developer needs to satisfy both the conditions
to get approval.

Decision – Held that the developer has to register the project within one month and pay thirty
lakhs.

11.2 Mr. Jatin Mavani v. M/s. Rare Township Pvt. Ltd, 2018

Issue – The issue, in this case, is the filing of several RERA proceedings on the same subject
matter. In this case, the complainant claimed that despite booking an apartment and paying
the appropriate consideration, he was not provided with the flat on time and that other
customers similarly sought redress from Maharashtra RERA, requesting the cancellation fee
be waived and the sum already paid to be refunded.

Arguments – The respondent builder argued that the first complainant never had the
agreement registered and hence it could not be carried out. Even after the respondent asked
him to enter into a new agreement, he refused and is now coming up with other buyers which
would amount to a multiplicity of proceedings under the same authority, as he was a party to
an earlier proceeding.

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Decision – The Maharashtra RERA took note of this and decided that the complainant had
exhausted his remedy when he first sought the forum and that he now has no locus standi in
approaching the court because, if he is regarded as an allottee, numerous proceedings before
the same court would not be permitted.

11.3 Sushil Ansal v. Ashok Tripathi, Saurab Tripathi, 2020

Facts – In this case, a decree was challenged in the NCLAT, which ordered the company to
file for insolvency in order to pay a sum of rupees 73 lakh awarded by Uttar Pradesh RERA.
The question was whether home buyers may be considered financial creditors.

Decision – The forum determined that homebuyers can enforce their decree under civil law,
but they cannot seek remedy from the IBC. According to the 2019 amendment, either 100
buyers or ten per cent of the allottee must file bankruptcy, but the fact that there are only 100
buyers can force the company to file bankruptcy by only two or three individuals. It is
clarified that a home buyer is not to be seen on the same lines as a financial creditor when it
comes to enforcing a decree for the repayment due to default on the part of the promoter
itself.

11.4 Baldev Singh v. Ultratech Township Developers Pvt Limited, 2020

Issue – The question, in this case, was whether an allottee can demand a refund while
withdrawing from a project which was nearing completion. The Authority in his opinion held
that it not only protects the interest of the buyers but promotes orderly growth of the real
estate industry through efficient project execution in the interest of the larger public.

Decision – The Haryana RERA Panchkula’s view can be summed up as follows –

“In case the relief of refund is granted to the complainant, interests of the rest of the non-
complainant allottees could also get seriously jeopardised. Moreover, the flat of the
respondent is complete and ready for possession and the complainant can take possession of
the flat after clearing his pending dues.”

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 12 Conclusion

The Act is a great step forward in terms of boosting transparency in the real estate market,
increasing promoter and developer accountability, and providing effective grievance
resolution channels. As there are stringent rules and regulations in the highly corrupt sector,
there will be less litigation. The establishment of laws like RERA is a big step forward in
terms of raising awareness among customers, promoters, and builders. In the future, similar
to RERA, the modernization of land records, land acquisition, and GST could be prioritized
for the real estate sector’s growth.

The RERA is dedicated to the successful and effective implementation of the country’s real
estate law, and it has adopted relevant and consistent steps to promote the sector’s
development. Various policy measures adopted under the RERA would undoubtedly produce
significant improvements in the economic and social transformation to stimulate the long-
term development of RERA, as well as a customer-friendly environment, and Urban
Poverty Alleviation

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