RERA can delegate its powers to single member to hear complaints from homebuyers

The Supreme Court has said the Real Estate Regulatory Authority (RERA) can delegate its powers to a single member to hear complaints from homebuyers against builders. A three-judge bench headed by Justice U U Lalit said Section 81 of the The Real Estate (Regulation and Development) Act, 2016 empowers the authority to delegate its power and functions to any of its member, by general or special order.

The top court said the scheme of the Act, 2016, provides an in-built mechanism and any order passed on a complaint by the authority is appealable, if any manifest error is left by the authority either in computation or in the amount refundable to the allottee/homebuyer.

“In view of the remedial mechanism provided under the scheme of the Act 2016, in our considered view, the power of delegation under Section 81 of the Act by the authority to one of its member for deciding applications/complaints under Section 31 of the Act is not only well defined but expressly permissible and that cannot be said to be dehors the mandate of law,” the bench said.

The apex court said the Real Estate (Regulation and Development) Act, 2016 (RERA) is retroactive (taking effect from a date in the past) in nature and covers all ongoing projects for which completion certificate has not been issued.

The top court said the legislative intent is to make the Act applicable not only to the projects which were yet to commence after the Act became operational but also to bring under its fold the ongoing projects and to protect from its inception the rights of the stakeholders.

“The clear and unambiguous language of the statute is retroactive in operation… the legislature consciously enacted a retroactive statute to ensure sale of plot, apartment or building, real estate project is done in an efficient and transparent manner so that the interest of consumers in the real estate sector is protected by all means,” the bench said.

The bench, also comprising Justices Ajay Rastogi and Aniruddha Bose, also made it clear that the amount which has been determined and refundable to the allottees/homebuyers either by the authority or the adjudicating officer in terms of the order is recoverable within the ambit of Section 40(1) of the Act.

The judgment dated November 11 came on an appeal filed by Newtech Promoters and Developers against an Allahabad High Court order which dismissed its plea against an order of a single member of the Uttar Pradesh Real Estate Regulatory Authority (Authority).

According to the order, the firm was directed to refund the principal amount along with interest to homebuyers who were not delivered possession of flats on time.