Delhi RERA To Issue New Set Of Guidelines

Delhi RERA To Issue New Set Of Guidelines

Delhi real estate regulatory authority (Delhi RERA) will issue new set of guidelines for builders and other stakeholders, informed Anand Kumar, chairman of the authority.

Kumar stated that there are several builders who are marketing and advertising real estate projects on super built-up area instead of carpet area. “Under the new guidelines, we will enforce that all projects’ advertisement and marketing mention carpet area. Builders must inform buyers about the actual size of property they are getting,” he said.

RERA chairman said that he is favours extending of the exemption from GRAP measures to all registered projects and they can give a representation to CAQM for this. “We do not give extensions if the GRAP measures have been applied for less than three days, but if they are more than that, we are willing to extend extensions to projects provided all necessary papers have been submitted. However, we will take strict measures against builders who are yet to register projects with the authority. The authority is willing to listen to grievances of the real estate fraternity and pass the suggestions to the central government for the betterment of the industry.”

Source:  https://www.rprealtyplus.com/news-views/delhi-rera-to-issue-new-set-of-guidelines-118429.html

Before buying an apartment, homebuyers must check if the property has legal issues pending against it

MahaRERA, in a recent order, has directed a realtor constructing a project near Mumbai, to disclose details about pending litigation in the public domain.

To protect the interests of homebuyers, the Maharashtra Real Estate Regulatory Authority (MahaRERA) has directed a real estate developer of a project in Thane near Mumbai to disclose all details regarding litigation pending against its under-construction project.

The Thane case

The owner of the land in Thane where the project is coming up had filed a complaint with MahaRERA in September 2024 on various issues, including ownership rights and the fact that the developer had not disclosed details about the pending litigation in the project on the MahaRERA website.

“Thereby, he has hid the said fact, and continues to sell off to innocent homebuyers, without disclosing the legal litigation endangering the investment of the homebuyers,” the owner of the land had said in his complaint and prayed that the issue be settled for a clear title.

During the hearing, MahaRERA informed the landlord that the ownership of the project land falls beyond RERA’s purview; hence, MahaRERA cannot decide on it.

The landlord informed the regulator that he has undertaken to take appropriate legal recourse under the law against the developer and has approached the high court for arbitration.

MahaRERA, in its order, directed the developer to upload the details of pending litigations on the MahaRERA website in the pending litigation column within 15 days from the date of the order, failing which appropriate penal action would be taken against him.

Is it mandatory for developers to disclose information about pending legal cases against a project to homebuyers?

According to section 4 of the Real Estate Regulatory Act, 2016, developers are expected to disclose details about the enterprise, including its name, registered address, type of enterprise, projects launched by the developer in the past five years, whether already completed or being developed, including the current status of the said projects, delay in completion of projects, details of cases pending, details of the type of land and payments pending among several others.

MahaRERA’s order

In the recent matter, MahaRERA, after reviewing the complaint filed by the landlord, also ruled out any violation of section 4 by the developer, as the landlord filed the case after the developer had procured the MahaRERA registration.

“The said promoter (developer) had applied for registration of the said project with the MahaRERA on 21-10-2021. However, it seems that the said litigation came to be filed in 2023 after registering the said project with the MahaRERA. Hence, the MahaRERA does not find any violation of section 4 of the RERA by the respondent,” reads the MahaRERA order.

The regulator directed the developer to disclose the details on the MahaRERA website under the pending litigation column, as required by law.

The order in this context reads, “Arbitration petitions filed by the landlord against the developer are after the registration of the said project with the MahaRERA in the year 2021. However, the same needs to be disclosed on the MahaRERA website in the ‘pending litigation column’ as mandated under the provisions of section 4(2)(A) and (B) of the RERA.”

MahaRERA said in the order that as a promoter of the said project, the developer cannot escape the statutory liability imposed on it under RERA.

Buyers should do their due diligence before investing in an apartment

According to legal experts, homebuyers purchasing an apartment should do their due diligence on the project they intend to invest in, especially with regard to legal issues pending against it. This will help minimise the risk of financial loss or disputes in the future.

“A developer, as mandated by RERA, must disclose any litigation pending before any Court of law regarding the project land or project. It is advisable that homebuyers conduct thorough due diligence and verify any details regarding pending legal issues while purchasing a flat in a project,” said Trupti Daphtary, a Mumbai-based advocate and solicitor.

Source: https://realty.economictimes.indiatimes.com/news/rera/bombay-hc-rules-real-estate-disputes-under-rera-non-arbitrable/116967549

Bombay HC Rules Real Estate Disputes Under Rera Non-Arbitrable

The judgment, lawyers say, is a landmark as it ensures that arbitration—a private alternate dispute redressal mechanism—won’t be the go-to solution for buyer-builder disputes that RERA tribunals must hear.

MUMBAI: The Bombay High Court has ruled that a dispute between an individual allottee and a promoter covered by RERA is non-arbitrable. The jurisdiction of the Real Estate Regulatory Authority, established under the provisions of the Real Estate (Regulation and Development) Act, 2016 (RERA), is not ousted, even if the agreement between the promoter and the allottee contains an arbitration clause, Justice Madhav Jamdar of the HC ruled.

The judgment, lawyers say, is a landmark as it ensures that arbitration—a private alternate dispute redressal mechanism—won’t be the go-to solution for buyer-builder disputes that RERA tribunals must hear.

The RERA appellate tribunal in Maharashtra directed a builder to refund Rs 12 lakh with interest to a buyer where the sale agreement was yet to be registered. The builder, Rashmi Realty Builders Pvt Ltd, said there was a memorandum of understanding which contained an arbitration clause for disputes. However, the HC, after analysing the law, said special rights are created under RERA and to enforce them, special fora are also established with special provisions to implement orders of MahaRERA and the Appellate Authority. “Thus, the disputes covered under RERA are non-arbitrable,” said Justice Jamdar in an Oct 25 judgment made available last week.

The builder appealed against a March 2023 RERA appellate tribunal order that reversed a Jan 2020 order of the Chairperson of Maharashtra Real Estate Regulatory Authority (MahaRERA). The Chairperson observed that since the parties were yet to enter into a registered agreement for sale, Section 18 of the RERA Act would not be attracted. The section allows a buyer who wishes to withdraw from a project to receive a refund with interest over delay in possession. The legal question framed by the HC was whether the jurisdiction of the Real Estate Regulatory Authority established under RERA is ousted if the agreement between the promoter and the individual allottee or an association of allottees contains an arbitration clause. The HC held it was not ousted.

Senior counsel Atul Damle, as amicus curiae, underlined that the legislators intended RERA to protect homebuyers. A R Upadhyay, the builder’s advocate, said the MoU executed in 2013, provided for arbitration in Mira Road and argued that since no agreement was registered with flat numbers, buyers were not classified as ‘allottees’ under RERA. The HC held that the MoU clearly showed them as allottees since the flat numbers were to be allotted at a function to be hosted by the builder, as argued by Advocate Altaf Khan for Rahul Pagariya and other buyers, who booked flats in a project called Rashmi’s Star City Phase IV.

Justice Jamdar said it was a well-settled that selecting arbitration as the mechanism is available only if the law accepts the existence of arbitration as an alternative remedy that is available to be chosen. If arbitration is repugnant or inconsistent with the law, such an option to adopt arbitration as the dispute resolution mode is denied, the HC said.

Source: https://realty.economictimes.indiatimes.com/news/rera/bombay-hc-rules-real-estate-disputes-under-rera-non-arbitrable/116967549

From Parking Rules To Guidelines On Senior Citizens’ Homes, MahaRERA’s Top 5 Game-changing Orders In 2024

MahaRERA Update: In 2024, MahaRERA Issued Several Homebuyer-friendly Orders To Boost Confidence In Maharashtra’s Real Estate Sector.

MahaRERA update: Former chairman, Ajoy Mehta, who retired in September 2024, released a book titled ‘ RERA – A Perspective’ in which he spoke about how the real estate sector is full of ‘horror stories.’

The Maharashtra Real Estate Regulatory Authority (MahaRERA) grabbed attention in 2024. The former chairman, Ajoy Mehta, who retired in September 2024, released a book titled ‘ RERA – A Perspective’ in which he spoke about how the real estate sector is full of ‘horror stories’ where homebuyers have either booked or purchased a property in a project that perhaps did not have the required approvals.

Mehta said that developers also sell flats on the higher floors (which command a premium) without clearances from civil aviation authorities. “It must be understood that while a plot may have the potential to be built up to a certain height, this was, however, possible only if it was subject to civil aviation clearances,” Mehta writes in his book.

However, even after new MahaRERA chairman Manoj Saunik took charge from Ajoy Mehta in September 2024, the inflow of homebuyers-friendly policy decisions and orders has continued. In 2024, MahaRERA issued at least a dozen homebuyer-friendly orders to boost confidence in Maharashtra’s real estate sector.

Here Are The Top 5 MahaRERA Orders In 2024

1. Parking Details To Be Included In The Agreement And Allotment Letter

In 2024, the MahaRERA asked real estate developers to mandatorily include details of parking spaces allotted or sold to homebuyers in the sale agreement and issue an allotment letter to prevent ambiguity and future disputes. The authority formally notified this direction on September 3.

MahaRERA’s logic behind issuing such an order was that it received several complaints from homebuyers, such as building beams obstructing vehicle parking, inability to park in the allotted slot, and inadequate manoeuvring space. Hence, MahaRERA made it mandatory for developers to include all details related to parking, such as size, height, and width, in annexures to the allotment letter and sale agreement.

2. Mention The Delivery Date Of Amenities In The Agreement

MahaRERA in July 2024, on getting several complaints from homebuyers that developers were delaying in providing amenities or facilities that were promised in the agreement or provided amenities and facilities were different from what was promised at the time of booking, the MahaRERA made it mandatory for developers to mention details such as delivery date of amenities, size, location of the amenities, to ensure that homebuyers get want they were promised.

3. Quality Of Construction To Fix Leakages In Homebuyers’ Flat

In April 2024, the MahaRERA issued a framework for appointing third-party agencies to determine the quality of construction before handing possession to homebuyers. The MahaRERA said this exercise aims to guarantee construction quality right from the outset for homebuyers.

Under the mechanism, the quality of construction will be audited during several phases throughout the construction cycle, including when finishing, before handing over possession to homebuyers. Before this, the Real Estate Regulatory Act of 2016 had mandated a five-year defect liability on the developers; however, the above order was issued to ensure the work was well audited and regulated during the construction stage itself.

4. Guidelines On Senior Citizens’ Homes

In May 2024, MahaRERA issued guidelines for real estate developers constructing senior citizen housing projects. This move makes MahaRERA the first housing regulatory body in India to promulgate provisions for housing projects for retired citizens.

The guidelines issued by MahaRERA covered a wide range of topics such as design, accessibility, mobility, bathrooms, green principles, and safety features, among others, for a project to be called a senior citizen housing project. The MahaRERA mandated developers to include special provisions in the Agreement for Sale and other relevant documents to mention details of the senior citizens’ housing project, per the guidelines issued by the regulator.

5. Consultation Paper On The Grading Of Real Estate Projects In Maharashtra

Former MahaRERA chairman Ajoy Mehta announced in 2023 that real estate project grading would take off in 2024. In 2024, the MahaRERA also floated a consultation paper to take public suggestions on grading real estate projects. The MahaRERA stated that grading was being done to help homebuyers make informed decisions. The regulatory authority had chosen four parameters based on information uploaded by the developers. These included technical, financial, and legal details and a project overview.

However, in October 2024, the regulator put the grading of real estate projects under cold storage. In October, MahaRERA officials told HT.com that the Real Estate Regulatory Act 2016 does not authorise regulators to grade projects.

“We are not going ahead with the plan for grading projects. How can MahaRERA, being a regulatory watchdog, rate or grade projects? The Real Estate Regulatory Act does not categorically allow the same. If we go ahead with grading, it might be challenged by someone in the court of law tomorrow. We do not want this to happen and hence are not rushing into anything like this,” a senior MahaRERA official, not wishing to be named, told HT.com.

Source: https://www.hindustantimes.com/real-estate/from-parking-rules-to-guidelines-on-senior-citizens-homes-maharera-s-top-5-game-changing-orders-in-2024-101734111084461.html

Odisha Govt To Streamline Registration Of Common Area, Modalities For Pre-RERA Projects

BHUBANESWAR: In a major development, the state government on Saturday announced a slew of measures including steps to streamline registration of common areas in apartments and preparation of modalities for registration of pre-RERA projects to protect the interest of home buyers as per norms of the Real Estate (Regulation and Development) Act 2016 and Odisha Apartment (Ownership and Management) Act, 2023.

The announcements were made following a consultative meeting of the stakeholders chaired by Housing and Urban Development secretary Usha Padhee to identify challenges in implementation of the new Odisha Apartment Ownership Act.

The department authorities said in view of the prescribed norms for registration and handing over of possession of the apartment and the common area in favour of home buyers under the law, the registration fee and stamp duty will be charged in a way that the same are not taken twice for the same space.

Bifurcation of cost will be provided in the agreement of sale for the calculation of the cost of the apartment and common areas. ORERA authorities will issue instruction to all stakeholders concerned to clearly indicate the bifurcated cost of common areas and cost of apartment in the agreement for sale.

If no such bifurcation has been made during registration of the deed, they will annex an additional schedule indicating the cost of the apartment concerned; cost of the common areas appurtenant to the apartment; cost of the project; and cost of the entire common area to facilitate appropriate calculation of the registration fees and stamp duty.

The H&UD department will also directed all the competent authorities to issue a Certificate of Registration of Association in favour of the associations covered under the provisions of Apartment Ownership Act. It will submit a proposal to the Revenue department regarding adoption of the model devised by Chhattisgarh government towards collection of a nominal registration fee and stamp duty on registration of the common areas, officials said. A consultative meeting will also be held soon to finalise the modalities for pre-RERA apartments to pave way for their registration, officials said.

Source: https://www.newindianexpress.com/states/odisha/2024/Nov/10/odisha-govt-to-streamline-registration-of-common-area-modalities-for-pre-rera-projects

RERA Relief For Homebuyers

Patna: The Real Estate Regulatory Authority (RERA), Bihar, on Friday passed an order providing relief to thousands of flat buyers stuck in stalled projects.

The order addresses the issue of ‘lapsed’ building projects, where promoters fail to complete the project within the stipulated period.

A double bench of RERA, comprising chairman Vivek Kumar Singh and member S D Jha, delivered the order related to the ‘IOB Nagar Block B’ project of Agrani Homes Private Limited.

They endorsed the proposal from the buyers’ (allottees’) association to complete the remaining development work themselves.

The matter was referred to the state govt as mandated by Section 8 of the RERA Act. Once the state govt responds, the project will be handed over to the buyers’ association, which will get it registered with RERA Bihar and proceed with the completion.

This decision is expected to bring relief to buyers of other stalled projects as well, allowing them to form associations and complete their projects through a similar legal process.

Several petitions were filed by homebuyers, including Shweta, Geeta Kumari, Kriti Kumari, Mukesh Kumar and Dr Rana Nagendra Kumar Singh, who had paid amounts ranging from Rs 8.25 lakh to rs 27.19 lakh to Agrani Homes Private Limited. However, the promoter failed to complete the project on time.

“The promoter became a defaulter by not paying the refund amounts mentioned in previous orders related to the same project,” the Authority said. The project’s registration lapsed on August 31, 2019, and the promoter showed no interest in seeking an extension or completing the work.

The promoter neither appeared in the complaint case nor responded to the notices sent for hearings on April 24, July 3, September 18 and October 16. Given the circumstances, the Authority decided the case based on the available facts and records.

The homebuyers had submitted a self-declaration about forming the Agrani IOB Block B Owners’ Association and provided an estimated cost of the remaining construction work through an empanelled engineer.

Source: https://timesofindia.indiatimes.com/city/patna/rera-grants-relief-to-homebuyers-stuck-in-stalled-projects/articleshow/114362194.cms

Homebuyers’ body demands setting up of Rera Monitoring Committee

The largest body of homebuyers has demanded setting up of a Rera Monitoring Committee (RMC) while flagging how real estate regulators (RERAs) have failed in effective implementation of the real estate regulation law. It has cited how several housing projects have not been registered despite the mandatory provision and also delay in completion of projects which started after the central law came into effect.

The Forum For People’s Collective Efforts (FPCE), which had campaigned for the RERA law, has referred to the findings and recommendations of the Amitabh Kant committee set up by the housing ministry to seek greater monitoring of regulators’ performance. It has suggested that the committee may be requested to holistically look into all the issues of the real estate sector and recommend the steps needed to be taken to ensure that situations like delayed projects don’t arise in future.

In a letter addressed to housing minister Hardeep Singh Puri, the FPCE has urged that the RMC should be composed of homebuyers, distinguished independent individuals and reputable non-profit organisations. “This committee should exclude any involvement of builders or their organisations. The RMC’s primary role would be to scrutinise the deviations, operational practices and overall functionality and intent of the RERA authorities, ensuring they are aligned with the true spirit of RERA implementation,” it said.

Referring to the high-powered committee’s recommendation of “mandatory registration with RERA” of all real estate projects, the FPCE said the promoters were legally obligated to register their projects as per the central law.

On the panel’s observation that developers were required to maintain and provide detailed records related to the project, which include financial statements, legal documents and construction status reports, the FPCE said promoters were not adhering to the mandate of updating project information every quarter and the regulatory authorities were not taking adequate actions to enforce this requirement. “Instead of imposing penalties for non-compliance, they seem to be only issuing notices after a significant period of default, which is certainly inadequate enforcement,” the homebuyers’ body said.

The FPCE has also said the committee’s recommendation, which includes projects that were started after the enactment of RERA and delayed by more than two years, can participate in the state government/ RERA led resolution process suggests that even projects initiated after the implementation of the law are experiencing delays and issues. It said this again raises doubts about the effectiveness and functioning of RERA in preventing project delays and ensuring timely completion.

On the recommendation that a fresh three-year extension may be given to all projects at no payment to authority, the homebuyers’ entity said the proposed extension does not consider timeline needed for completion of projects on a case to case basis which in many cases may be much less than three year period.

“It also lacks a compensatory provision for suffering homebuyers. This could potentially offer relief to builders but at the detrimental cost and continued suffering of homebuyers who have already endured prolonged project delays and an additional three year extension without any compensation may completely break them both financially and mentally,” the FPCE said.

Source: https://timesofindia.indiatimes.com/business/india-business/homebuyers-body-demands-setting-up-of-rera-monitoring-committee/amp_articleshow/103231425.cms

Gurgaon RERA To Verify Consent In Case Of Building Plans Change

The Real Estate Regulatory Authority (RERA) of Gurugram has decided to check the veracity of the two thirds consent submitted by the real estate promoters in the case of any changes in the layout plans or any revisions in the building plans in a real estate project.

The Real Estate (Regulation and Development) Act 2016 mandates changes or revisions, as the case may be, in the layout or building plans subject to a two-thirds of consent of allottees as a must. The authority usually issues a public notice inviting objections and in case no objection is received, it allows the changes. In case any or some objection is received, it is heard and the case is decided on merit.

However, as a matter of abundant caution, the authority now on will get the consent checked to the extent possible. The idea behind this effort is to protect the sanctity of allottee’s rights under the RERA Act, said the authority.

As per the Section 14 of RERA Act, the promoter shall not make any additions and alterations in the sanctioned plans, layout plans and specifications and the nature of fixtures, fittings and amenities described therein in respect of the apartment, plot or building, as the case may be, which are agreed to be taken, without the previous consent of that person: provide that the promoter may make such minor additions or alterations as may be required by the allottee, or such minor change or alterations as may be required by the allottee, or such minor change or alterations as may be necessary due to architectural and structural reasons duly recommended and verified by an authorized Architect or Engineer after proper declaration and intimation to the allottee.

Source: https://www.rprealtyplus.com/news-views/gurgaon-rera-to-verify-consent-in-case-of-building-plans-change-116702.html

Haryana RERA To Check Consent For Layout Changes Submitted By Developers

The Real Estate (Regulation and Development) Act of 2016 mandates changes or revisions — as the case may be — to layouts or building plans provided two-thirds of the allottees say yes to it.

GURUGRAM: The Real Estate Regulatory Authority (Rera) in the city has decided to check “to the extent possible” the veracity of two-thirds consent of allottees that real estate promoters submit in case they want any change in their layouts or a revision of their building plans.

The decision was taken at a meeting of Rera officials on Monday.

The Real Estate (Regulation and Development) Act of 2016 mandates changes or revisions — as the case may be — to layouts or building plans provided two-thirds of the allottees say yes to it.

According to Section 14 of the Haryana Rera Act, “the promoter shall not make any additions and alterations in the sanctioned plans, layout plans and specifications and the nature of fixtures, fittings and amenities described therein in respect of the apartment, plot or building, as the case may be, which are agreed to be taken, without the previous consent of that person: provided that the promoter may make such minor additions or alterations as may be required by the allottee, or such minor change or alterations as may be necessary due to architectural and structural reasons duly recommended and verified by an authorised architect or engineer after proper declaration and intimation to the allottee.”

Section 14 (2)(II) of the Act also says that the “promoter shall not make any other alterations or additions in the sanctioned plans, layout plans and specifications or the buildings or the common areas within the project without the previous written consent of at least two-thirds of the allottees, other than the promoter”.

Before allowing the alterations, the authority usually issues a public notice inviting objections. In case there are no objections, it allows the changes. In case some objections are received, the case is decided on merit.

“As a matter of abundant caution, the real estate authority will from now on get the consent checked to the extent possible. The idea behind this effort is to protect the sanctity of allottees’ rights under the Rera Act,” a senior official said.

Advocate Harshit Batra, who deals in cases related to properties, backed the Rera move. “This will not only save the parties from any future litigation involving the approval of revised plans but will also help in the smooth implementation of revised development.”

Source: https://realty.economictimes.indiatimes.com/news/rera/haryana-rera-to-check-consent-for-layout-changes-submitted-by-developers/113210972

Supreme Court Holds Landowners Liable Along With Builder For Deficiencies In Flat Constructions

The Supreme Court recently held that a revocation of power of attorney executed between landowners and builder for developing their land would not absolve the landowners from being jointly and severally liable along with the builder in a consumer case for deficiency of service.

The Court observed that the Joint Venture Agreement (JVA) between the builder and the landowners remained operative even after the revocation of the power of attorney. It was also held that the expression ‘henceforth’ used in the revocation letter to the builder meant that landowners would be ceased of any liability for builder’s actions that occurs subsequent to the termination and that would not exclude the landowners’ liability for the agreements that the builder entered into with the buyers before the termination.

“It further appears that though allegedly the said power of attorney was revoked by the appellants vide the letter dated 12-8-2014, the JVA has not been revoked so far and the same still continues to be in force.

As rightly submitted by the learned counsel for the respondents, in the letter dated 12-8-2014, the appellants had stated to be not liable “Henceforth”, i.e. after the said letter was sent. The appellants therefore were bound by the acts/deeds of the Respondent No.2 carried out pursuant to the irrevocable Power of Attorney till it was terminated, in accordance with law.”

The bench of Justices Bela Trivedi and SC Sharma was considering the challenge to the order of the National Consumer Disputes Redressal Commission, New Delhi dated November 28, 2017 which upheld the order of the State Commission in holding the appellants and Respondent no.2 liable for deficiency in service for the completion of the construction of dwelling units to flat buyer who are the respondents.

The appellants who are landowners, and respondent no.2 (builder) had entered into a Joint Venture Agreement (JVA) for building flats and selling them subsequently.

The appellants had also executed an Irrevocable Power of Attorney (IPA) in favour of the respondent no.1 on July 6, 2013. On the premise of the said IPA, the respondent no.2 entered into sale agreements with respondents for the sale of the flat units.

The respondents subsequently filed a complaint before the Maharashtra State Consumer Disputes Redressal Commission for being jointly and severally liable for unfair trade practices and deficiency of service in completing and handing over the possession of the6 promised flat units by the appellant and the respondent no.2

The State Commission in its order dated July 10, 2017 held (1) the appellants and respondent no.2 to be liable and directed them to hand over the possession to the complainants in a span of 6 months from date of order; (2) execute sale deed of the units as the agreement to sell between the parties; (3) the respondent no.2 to give compensation of Rs 1,00,000/- to each of the complainants for physical and mental harassment.

The said decision was upheld by the NCDRC which observed the appellants had only cancelled the JVA and IPA on August 18, 2014 which was much after the agreement entered between the Respondent no.1 and flat buyers/ remaining respondents. Noting the observation from the State Commission’s order, NCDRC stated :

“The State Commission concluded that at the time of the agreement between the builder and the complainants, the JVA and IPA were very much operative. It is evident, therefore, that the appellants cannot wash their hands off from the matter, as it would result in grave injustice to the complainants consumers.”

Arguments By The Counsels

Senior Advocate Kailash Vasdev appearing for the appellants argued that the appellants revoked the IPA granted to respondent no.2 on August 12, 2014 along with a public notice and hence could not be held liable for the acts done by the respondent no.2.

It was additionally argued that since the appellants were not privy to the agreement between the respondent no.2 and flat buyer/remaining respondents, a complaint against them under the Consumer Protection Act would not be maintainable.

Senior Advocate Siddarth Dave representing respondent no.2 had submitted that respondent no.2 was ready to complete the construction work and honour the JVA .

Senior Advocate Gopal Sankaranarayan appearing for one the flat buyers/ remaining respondents highlighted that the IPA revocation letter of August 12, 2014 stated that the appellants will not be liable for the acts of the Respondent No.2 “henceforth”- that is acts done after the revocation letter is communicated.

Appellants Jointly & Severally Liable As Per The Revocation Letter; JVA Was Operative Even After Revocation Of Power Of Attorney : Bench Observes

The Bench made two key observations is holding the appellants liable jointly and severally along with the respondent no.2 – (1) the appellants while revoking the power of attorney executed to the respondent no.2 had not revoked the JVA, which continues to stay operative and (2) the use of the expression ‘henceforth’ in the revocation letter by the appellants would mean that they cease their liability only for the actions of respondent no.2 after August 12, 2014 and this wouldnot exclude them from the liability of the builder’s conduct of entering into agreements with the flat buyers.

“It further appears that though allegedly the said power of attorney was revoked by the appellants vide the letter dated 12-8-2014, the JVA has not been revoked so far and the same still continues to be in force.

As rightly submitted by the learned counsel for the respondents, in the letter dated 12-8-2014, the appellants had stated to be not liable “Henceforth”, i.e. after the said letter was sent. The appellants therefore were bound by the acts/deeds of the Respondent No.2 carried out pursuant to the irrevocable Power of Attorney till it was terminated, in accordance with law.”

It was also observed that appellants have also taken against respondent no.2 for non-compliance of the JVA, implying it be remain operative between the parties.

“It is also not denied that the appellants have not taken any action whatsoever against the respondent No.2 with regard to the alleged non-compliance of the terms and conditions of JAV by the said Respondent. Under the circumstances, it does not lie in the mouth of the appellants to say that the appellants are not liable for the acts of Respondent No.2.”

The Court therefore upheld the decision of the NCDRC and refused to interfere with the impugned order. The appeal was dismissed as being devoid of any merits.

Source: https://www.livelaw.in/amp/top-stories/supreme-court-holds-landowners-liable-along-with-builder-for-deficiencies-in-flat-constructions-268714