Real estate projects come under the ambit of Rera (Real Estate Regulation and Development Act) regardless of whether they are registered under Rera or not, the Gurgaon bench of Haryana Rera has ruled.
The bench, headed by Haryana Rera chairman KK Khandelwal, thus expanded its scope of adjudication and announced Rera as the de facto regulator of the real estate sector. It also nullified dilution of the act’s provisions by Haryana, said a senior Haryana Rera official.
“The Rera 2016 Act nowhere mentions that it is applicable only for registered projects,’’ the judgment said. All real estate projects are covered for land title defect liability, it added.
‘Buyer can go to Rera over defect in completed unit’
The Rera 2016 Act provides certain categories of projects are not required to be registered but these are within the ambit of the Act,’’ according to a judgment of the Gurgaon bench of Haryana Rera. Some projects like those on less that 500 square metres and less than eight units have been taken out of the registration requirement as mentioned in section 3(2) of the Act. But they are “not out of the purview of other provisions of the Act,’’ the judgment noted.
Promoters have taken the stand that once a project is completed and registered, it is no longer under the ambit of Rera. But the judgment states that if a buyer finds some defect in the structure of a completed unit, he can approach Rera for redressal, whether the project is registered or not.
In its landmark judgment in the case of Simmi Sikka versus Emaar MGF, the Gurgaon Bench of Harera not only settled confusion about the applicability of the Act and registration of projects but also attempted to nullify the effect of dilution of the provisions of the Act by Haryana Rera rules, said a senior official of Haryana Rera.
The decision also settles the controversy regarding ongoing projects. As the Act specifically provides that the developer is responsible for workmanship and structural defects liability for five years, projects which were completed and handed over during the last five years are covered for the purpose of such defect liability, the judgment said.
Ongoing projects have now been treated as those where completion certificate has not been issued prior to commencement of the Act on May 1, 2017. However, the judgment noted that mere filing of an application for occupation or completion does not exempt the project from registration. It is only grant of completion certificate before the commencement of the Act that will exempt the project from registration, it said.
Harera Gurugram further decided that all new projects are to be registered with the authority irrespective of whether the builders is intending to market the real estate after completion of the project or during construction phase.
In the case of Simmi Sikka versus Emaar MGF, the bench ruled that provisions of the Act regarding registration had been violated. Accordingly, it has been decided to initiate penal proceedings against the promoter wherein a penalty of up to 10% of the project cost could be imposed.