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SC directs West Bengal govt to respond to homebuyers' petition challenging constitutional validity of WBHIRA

Matter listed for next month for final hearing.

Vandana Ramnani @vandanaramnani1

The Supreme Court on July 19 directed the West Bengal government to respond to homebuyers' petition challenging the constitutional validity of West Bengal Housing & Industrial Regulation Act 2017 (WBHIRA). The matter is listed for next month for final hearing, legal sources said.

The apex court in February this year had admitted a public interest litigation filed by a group of homebuyers that challenged the constitutional validity of WBHIRA and had issued notice to the West Bengal government on notifying its own version of the real estate law despite the existence of a Central RERA. The West Bengal government was then directed to file a reply within two weeks.

West Bengal is the only state in the country that has not accepted RERA. The Central Real Estate (Regulation and Development) Act (RERA) came into effect on May 1, 2017, exactly a year after it was passed by the Parliament.

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The petition has been filed by the Forum for People's Collective Efforts (FPCE), an umbrella homebuyers association. In its petition, the association has said that if WBHIRA is allowed to continue, it would give way for state legislatures to enter into other fields to legislate under the concurrent List, which otherwise are occupied by central legislations.

It may also prompt other states to come out with their own State laws, further diluting the provisions in favour of builders, thereby defeating the purpose of a uniform RERA and rendering RERA redundant.

In its petition, FPCE has prayed that the Supreme Court pass an order declaring the West Bengal Housing Industry Regulation Act, 2017 as ultra vires the provisions of the Constitution of India and consequently, issue an appropriate writ/order or direction in the nature of writ of mandamus/order directing the State of West Bengal to not enforce the provisions of the West Bengal Housing Industry Regulation Act, 2017 within the State of West Bengal.

The homebuyers have challenged the constitutional validity of WBHIRA. They have argued that a Central RERA had already existed before the state of West Bengal enacted WBHIRA.

"The constitutional scheme requires that the State Act should give way to the Central legislation and it is the Central statute alone, which should prevail in the State of West Bengal," they said in their petition.

The state law in Maharashtra was earlier repealed despite a presidential assent and Kerala too did not implement its own Act.

Homebuyers have argued that while RERA is in various stages of implementation and most states have either taken the lead in notifying the rules or some are at various stages of implementation, it is only West Bengal that stands out as it is not only not implementing RERA but rather, has chosen to enact the impugned State Act in complete disregard for the Central Act, questioning the supremacy of Parliament.

They have noted that there is a direct conflict between the RERA and WBHIRA. For instance, whether the Regulatory Authority would be under RERA or WBHIRA, or whether registration of real estate projects or real estate agents will be under the Central law or State law. This would lead to chaos in the state, the petition states.

Real estate developers and realty agents in West Bengal say that they have no option but to register under WBHIRA to stay in business.

Experts said that HIRA defeats the very purpose of Central RERA. "The first is to do with the force majeure clause or unforeseen circumstances under which a builder may not fulfil conditions laid down under the contract signed with the homebuyers. RERA clearly lays down the circumstances of force majeure such as war, flood, drought, fire, cyclone, earthquake or any other natural calamity. HIRA has made an addition to this clause and talks about '…any other circumstances as may be prescribed'. This is a major dilution."

Sale of open space as a garage or parking area was an issue dealt under RERA. HIRA has interpreted it differently. RERA defines garage to mean a place within a project that has a roof and walls on three sides for parking any vehicle but it does not include unenclosed or uncovered parking area, especially open parking.

HIRA, on the other hand, states that car parking area means such an area as may be prescribed and defined garage to mean garage and parking space as sanctioned by the competent authority.

vandana.ramnani@nw18.com

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First Published on Jul 19, 2019 04:44 pm
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