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    Legal Opinion For Homebuyers

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    Rishabh Goswami
    1. The document compares different legal options available to homebuyers in distress - the Real Estate Regulatory Authority (RERA), Consumer Forums, and the National Company Law Tribunal (NCLT) under the Insolvency and Bankruptcy Code (IBC). 2. It outlines key differences between the options such as typical timelines for resolution, who can file complaints or applications, the appropriate forum or authority to file with, appellate structures, accessibility of forums, and types of relief or executions provided. 3. The analysis suggests that while RERA and Consumer Forums may provide faster relief, the IBC process administered through NCLTs allows for more comprehensive

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    Legal Opinion For Homebuyers

    Uploaded by

    Rishabh Goswami
    77 views5 pages
    1. The document compares different legal options available to homebuyers in distress - the Real Estate Regulatory Authority (RERA), Consumer Forums, and the National Company Law Tribunal (NCLT) under the Insolvency and Bankruptcy Code (IBC). 2. It outlines key differences between the options such as typical timelines for resolution, who can file complaints or applications, the appropriate forum or authority to file with, appellate structures, accessibility of forums, and types of relief or executions provided. 3. The analysis suggests that while RERA and Consumer Forums may provide faster relief, the IBC process administered through NCLTs allows for more comprehensive

    Original Description:

    redressal for homebuyers under consumer protection act, RERA vis a vis IBC

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    Legal Opinion for Homebuyers

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    1. The document compares different legal options available to homebuyers in distress - the Real Estate Regulatory Authority (RERA), Consumer Forums, and the National Company Law Tribunal (NCLT) under the Insolvency and Bankruptcy Code (IBC). 2. It outlines key differences between the options such as typical timelines for resolution, who can file complaints or applications, the appropriate forum or authority to file with, appellate structures, accessibility of forums, and types of relief or executions provided. 3. The analysis suggests that while RERA and Consumer Forums may provide faster relief, the IBC process administered through NCLTs allows for more comprehensive

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    77 views5 pages

    Legal Opinion For Homebuyers

    Uploaded by

    Rishabh Goswami
    1. The document compares different legal options available to homebuyers in distress - the Real Estate Regulatory Authority (RERA), Consumer Forums, and the National Company Law Tribunal (NCLT) under the Insolvency and Bankruptcy Code (IBC). 2. It outlines key differences between the options such as typical timelines for resolution, who can file complaints or applications, the appropriate forum or authority to file with, appellate structures, accessibility of forums, and types of relief or executions provided. 3. The analysis suggests that while RERA and Consumer Forums may provide faster relief, the IBC process administered through NCLTs allows for more comprehensive

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    Legal opinion for homebuyers in distress

    S. Basis RERA Consumer Forum NCLT (IBC)


    No.
    1. Time RERA has been formed It takes about 5-6 It takes about 6 Months
    recently and it takes on Years for Redressal for adjudication of
    an average couple of of Grievance or Insolvency Application
    years for Redressal of adjudication of and to admit the same
    Grievances. dispute by Consumer by Adjudicating
    Forum. Authority.
    2. Who can file A Consumer i.e. a Since by recent
    A Purchaser/Home
    person who satisfies amendment in August
    Buyer or prospective
    purchaser / Home Buyer
    the requirement 2018, the Allottee of
    offered flat can file under Section 2(d) of Project is considered a
    Complaint irrespective of CPA can file Financial Creditor, any
    the fact that such person complaint. Thereby person whether an
    is Corporate Entity or only a person, Individual or Corporate
    Individual.
    typically Individual Entity can file an
    who enters into Insolvency Application
    agreement for under Section 7 of IBC.
    purchase of Flat can Also, allottee who is
    file complaint when competent to file
    he purchases the Application in my view
    same for his can be both purchaser
    individual use and under Redevelopment or
    residence. existing tenant / owner/
    occupant of Flat /
    Apartment.
    3. Application/Complaint Complaint is to be filed Complaint is to be Insolvency Application
    to be filed before before Real Estate filed before is to be filed before
    whom Regulatory Authority Consumer Forum Adjudicating Authority
    established in each state having territorial i.e.
    by respective State pecuniary a) National Company
    govt. where the project Jurisdiction to hear Law Tribunal having
    is situated. Complaint. territorial jurisdiction
    over the place where
    registered office of
    Corporate entity is
    situated in case of
    Corporate Entities;

    b) Debt Recovery
    Tribunal in the territorial
    jurisdiction of which
    individual resides,
    carries on business or
    personally works for
    gain.
    4. Appellate Structure A. Real Estate A) State Forum; A. National Company
    under the Act. Regulatory Authority; Law Tribunal;
    B) National Forum;
    B. Real Estate B. National Company
    C) Supreme Court.
    Appellate Tribunal; Law Appellate Tribunal;
    *A writ petition
    C. High Court; C. Supreme Court.
    under Article 226 &
    D. Supreme Court. 227 can be preferred *A writ petition under
    in exceptional Article 226 & 227 can
    circumstances be preferred in
    against the decisions exceptional
    of the Forums. circumstances against
    the decisions of the
    Company Law
    Tribunals.
    5. Accessibility There are typically as of A. State Commission NCLT is typically
    now, one or two Real presides in capital of constituted for each state
    Estate Regulatory each state and and presides at one
    Authority offices in sometimes has place in the state or one
    each state which has benches in other NCLT is commonly
    constituted the parts of the State. empowered and is
    Authority under the having jurisdiction over
    B. National
    Act. two states.
    Commission
    In the present case, the presides at Delhi and
    appropriate Forum shall has circuit benches
    be UP RERA. in various parts of
    the Country which
    are rotating.
    6. Execution/Reliefs Real Estate Regulatory The Consumer Once, NCLT admits the
    provided Authority typically Forum has the power Insolvency Application,
    exercise its power by to execute its own IRP comes into the
    way of an order to orders. This makes picture to manage the
    impose fine, deregister execution of orders affairs of the Company
    the project, include the also an expeditious and in case of failure of
    promoter in list of affair in comparison Corporate Insolvency
    defaulters, direct to regular suits or Resolution Process
    completion of project in execution of orders ("CIRP") (In case of
    manner provided in passed by various Developer being a
    consultation with State Courts/Quasi- Corporate Entity),
    Government and pass Judicial Forums. Liquidation would be
    appropriate orders Also, since scope of commenced. NCLT
    incidental thereto. Consumer Act is monitors the entire
    limited, the relief process and time to
    *Since Home Buyers
    and consequently is time, various reports are
    are particularly
    interested in completion execution is required to be filed with
    comparatively an NCLT. In other cases
    and handing over
    possession of their flats, expeditious affair. liquidation would be
    commenced by DRT.
    RERA Authority
    provides for stages wise
    utilisation of moneys
    paid by them and a
    separate account to be
    maintained for the
    purpose. In case of
    default to complete
    project or other non-
    compliances, RERA
    provides for various
    measures to complete
    the project and
    empowers the authority
    for the same for that
    home buyers are not
    kept in lurch. Also, it
    tries to penalise
    builders by aforesaid
    measures so that they
    are prevented and
    discouraged from
    undertaking further
    projects when they do
    not have requisite
    resources.
     After the Insolvency and Bankruptcy Code, 2018 (Amendment) passed in August
    2018, Homebuyers are considered at par with financial creditors during liquidation
    proceedings of a company. This change was introduced recently to curb exploitation
    of rights of homebuyers and providing them with a machinery to redress their
    grievances in case of insolvency or liquidation proceedings. One can approach the
    Authority i.e. NCLT (National Company Law Tribunal) having jurisdiction over the
    dispute under section 7 of Insolvency and Bankruptcy Code for the purpose of
    declaring the said company insolvent. Homebuyers are considered as unsecured
    financial creditors as per new regulations and judgments of Supreme Court.
     Apart from approaching NCLT (The Authority) homebuyers also have an option of
    approaching any consumer forum or RERA for the redressal of their grievances.
     RERA (Real Estate Regulatory Authority), was introduced in 2016 for curbing the
    menace of exploitation of consumers by fraud builders and constructors and other
    builders. RERA provides efficacious remedy to the consumers/homebuyers not being
    delivered their rightful possession within stipulated time. Almost every state has their
    state regulatory authority for RERA.
     Regarding Consumer Forums, homebuyers can also approach State Consumer Forums
    and appeals thereafter. The jurisdiction of State Commission applies only if the
    amount in dispute exceeds Rs. 20,00,000/- but does not exceed Rs. 1,00,00,000/-. A
    formal complaint under section 17 of Consumer Protection Act, 1986.

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