A person who receives the aforementioned property via transfer or sale is deemed an allottee or homebuyer, but a tenant is not, according to Section 2(d) of the Real Estate Regulatory Authority Act. Every home buyer is anxious about being duped by unscrupulous builders, and incidences of cheating, fraud and other sorts of deception are on the rise every day. After paying the builder’s fee, the home buyer is unsure whether he will receive the property, as well as whether it will be delivered on time and in good condition. In the case of a financial crisis, smart buyers should be informed of all of the options available to them. The government has recognized the challenges that first-time home purchasers face and has taken appropriate steps to help them. However, a first-time home buyer may be unaware of his or her legal rights at times.
Consumer Protection Act, 1986
If a builder fails to offer acceptable service or fails to deliver the house in a timely way, a Home Buyer may register a complaint under the Consumer Protection Act. Any individual consumer or a group of consumers with a common cause of action may file a complaint. It is not necessary to employ the services of an Advocate to register such a complaint because the processes that must be followed are simple. The Applicant must file a Complaint with the relevant administrative agency, together with any supporting paperwork.
Real Estate Regulatory Authority of India Act(RERA Act), 2016
To balance the interests of home purchasers and builders, the real estate industry’s size and complexity continues to rise. If the developer does not finish the project on schedule, the buyer will be charged interest. Real estate purchasers may file a complaint with the relevant Real Estate Regulation Authority if the developer fails to provide possession on time or otherwise breaches the RERA Act or its Rules and Regulations. An Association of Home Buyers can sue a real estate agent.
Buyers or allottees have the following rights and duties under Section 19 of Chapter 5 of the RERA Act, 2016:
- Right to information: The homebuyer has the right to obtain information about the project, including sanctioned blueprints, layout plans, the RERA registration number, and specifications recognized by the competent authorities.
- Right to know the completion schedule: The home buyer has a right to know the project’s progress, including provisions for water, sanitation, power, and other amenities and services indicated in the sales contract.
- Possession rights: If all essential requirements have been completed and the requisite remuneration has been paid, the home buyer has the right to take ownership of the property, including the shared spaces.
- Right to claim refund: If the builder fails to comply or is unable to give possession of the property in accordance with the terms of the agreement for sale, or if his business as a developer is discontinued due to suspension or revocation of his registration, the home buyer has the right to file a complaint under RERA and seek a refund of the amount paid, plus interest and compensation, from the builder. Developers, on the other hand, will be allowed one more opportunity to create an acceptable delivery schedule before being penalized. If a buyer is unhappy with RERA’s judgment, he or she can appeal it to the Appellate Tribunal.
- Right to documents: The home buyer has the right to all essential paperwork and designs, including those for shared spaces, after the developer gives over physical possession of the property.
- Defective property right: Within 5 years of possession, the builder must rectify any structural or quality faults at no additional expense to the customer.
Insolvency and Bankruptcy Code, 2016
Homebuyers are recognized as financial creditors under the modified IBC in the same way that other creditors are. As a result of the new legislation, purchasers now have the option of commencing the Corporate Insolvency Resolution Process (CIRP) against the building business.
Competition Commission of India, 2002
The buyer might bring a complaint against the builder for abuse of dominant position under the Competition Act 2002. If the builder is found guilty of anti-competitive practices, he will be penalized heavily by the CCI.
Indian Penal Code, 1860
A buyer can charge the builder with cheating, fraud, etc. under the Indian Penal Code, 1860. The buyer can complain to the Economic Offence Wing. The buyer can also sue the builder and its directors for fraud, money laundering, etc. If the builder does not appear in court, a Non Bailable Warrant can be issued against them.
Individual homebuyers are the backbone of the Indian real estate industry, making up the majority of investors in any given real estate development. Insolvency and Bankruptcy Code of 2016 or the Real Estate (Regulation and Development) Act of 2016 provides avenues for homebuyers to seek legal recourse and relief. The CPA, RERA, and IBC remedies are all concurrent. In a conflict, IBC trumps RERA.
There are numerous factors that make the legal position of these important stakeholders highly changeable, such as the following: Due to its complexity and exhaustive nature, even a trained attorney may not be able to help the average homebuyer traverse the tri-remedial procedure provided by the Real Estate Act, the Consumer Protection Act (CPA), or the Insolvency and Bankruptcy Code. As a second point, the recent split in judicial opinion on homebuyers’ rights is a significant obstacle to the legal standing of homebuyers, whose fate is frequently decided by the courts. Foreclosures have increased as a result of the court disagreement on homebuyers’ rights.
Our legal team is expert in settling of claims against developers in Consumer Forum, Real Estate Rural Authority and Competition Commission of India in situations where developer fails to give possession to Home Buyer on time or breaches any of the said laws. Our legal team is well versed with the issues which emerge in these matters and endeavor to provide the Client with a fast-track strategy to resolve their grievances. Contact now to get free consultation on your matter.