Over 200 home buyers across the state participated in a protest at the Town Hall on May 18th, demanding proper enforcement by the Real Estate Regulatory Authority (RERA) in Karnataka. The protest was organised by the Forum for People’s Collective Efforts, Karnataka Chapter (known earlier as Fight for RERA), in association with the Namma Bengaluru Foundation, Bangalore Apartments’ Federation, Federation of Apartment Associations Bengaluru, and various Resident Welfare Associations and organisations across Karnataka.
The protesters said that Karnataka RERA (KRERA) has not taken any stringent action even when its own judgements were not honoured by erring builders and developers. There are many provisions in the Central RERA (Real Estate (Regulation and Development) Act, 2016) against builders who don’t comply with orders or don’t register projects under RERA, such as hefty penalties, revoking RERA registration or denying new registrations, issuing directions to confiscate the properties of violators, to freeze bank accounts, for forensic audit to find financial irregularities etc. (As per the Act, big real estate projects have to register with RERA to ensure transparency.)
So far, in the span of two years, KRERA has not held a single RERA awareness event, though the RERA Act Section 33(3) says, ‘The Authority shall take suitable measures for the promotion of advocacy, creating awareness and imparting training about laws relating to real estate sector and policies’.
Many state laws are not consistent with RERA as well. Glaring inconsistencies are on matters of Commencement Certificate (CC) and Occupancy Certificate (OC). RERA mandates CC for obtaining RERA registration, and OC for registration of sale deed by buyers. As per RERA Section 2 (t), (w) (zb), completion of all internal and external development works is mandatory before buyers can take physical possession of the properties. But there are many projects which have been awarded OC, though their development works are not completed as per RERA requirements.
M S Shankar of FPCE Karnataka said, “The KRERA authorities should issue directions to Stamps and Registration Department to ensure compliance with RERA Section 13 and 17, by upgrading their software to ensure that RERA registration number, OC and Deed of Declaration details are compulsorily mentioned in the sale deed.”
Necessary training should be given to BDA, BBMP, BMRDA, sub-Registrars, Registrar of Co-operative Society etc., on expectations under RERA Act which has been pending for two years.
Builders file false police complaints, initiate defamation cases, civil and criminal cases, and threaten buyers for approaching RERA Authority, NGOs, social media etc. We have brought to the knowledge of KRERA authorities certain such issues, and KRERA authorities too have seen such arguments in their court hall between a buyer and the builder’s advocates. But there is no support and action from RERA authorities against builders who are coercing buyers.
The developers come with a battery of lawyers and pay fees from the money that home buyers had paid for their homes. This is unfair, and KRERA should give legal help to homebuyers to prevent harassment by developers.
We FPCE, with great difficulty, is infusing a lot of confidence and courage among homebuyers to come out to report their grievances with KRERA authority. But, due to coercion and threats, buyers are afraid to open up and come out.
There is no transparency in the project registration process, and in the authenticity of the documents that builders submit while seeking RERA registrations. Buyers’ complaints are not heard as per serial number, and judgements are not uploaded for public viewing. There is no data available on the compliance or non-compliance of the orders as well.
There is no accountability either. There are many unregistered projects, and many registered projects that are expired (943 projects applied for extension, as of 15th May).
It is observed from the RERA Karnataka website that many complaints registered by buyers have not been heard for close to two years. It is evident that KRERA is not serious enough to implement and enforce the RERA Act, and are allowing the builders to complete the project and escape RERA registration.
Below are some examples of project complaints that KRERA has not heard. However, some of these builders are launching new projects for which they are getting new RERA registrations, while the project under complaint is kept out of RERA registration till today.
- Complaint No. CMP/170801/0184403 dated 01/08/2017 – GM Infinite Spring Field
- Complaint No. CMP/171128/0000276 dated 28/11/2017 – Mantri Webcity
- Complaint No. CMP/171227/0000354 dated 27/12/2017 – Mantri Manyatta Energeia
- Complaint No. CMP/171124/0000261 dated 24/11/2017 – GM Infinite E-City Phase 2
The promoters, while applying for RERA registration, as per section 4(2)(l)(C), undertakes to complete the project or phase within a specific period. But there is no process to track the construction status, usage of money and the balance amount required to complete the project.
Due to the lack of such a process, now there are 943 projects which are listed in the RERA Karnataka website under different categories, like Applied for Extension, Applied for Project completion, Not applied for Extension. These categories are very vague, and RERA Act does not have the provision to make such categorisations.
The 943 projects that applied for extension include KHB and BDA projects, Mantri Webcity, Sobha Silicon Oasis, The Green Phase I & II, Skylark Arcadia, Purva Westend, Bearrys, Prestige Royal Gardens etc. There are projects for which RERA registration had expired in July, and we did not see any action against these. Even after RERA registration, if the builder does not complete the project on time, the next course of action need to be initiated as per Section 7 of the Act.
The RERA registration of these projects had expired as a result of fund diversion. All such projects should be analysed, and forensic audit should be ordered to find out their financial indiscipline. What is the protection available to the buyers who have paid and are waiting for their homes from these projects? RERA should suo motu order the builders to pay compensation and interest till project completion.
KRERA is short-staffed and lacks qualified professionals. There is urgent need of field staff, architects, chartered accountants, surveyors, engineers and stenographers to support KRERA.
Suresh NR, Director, Namma Bengaluru Foundation said, “NBF, along with Fight for RERA Karnataka Chapter, has been repeatedly requesting the Karnataka government to strengthen the RERA Act which was passed in 2016, and to protect the interests of home buyers. But nothing has been done yet. There are about 2372 cases pending in KRERA, and consumers are deprived from poor RERA enforcement. There was no public consultation before enforcing the Act. Today our protest is all about consumer rights and builders’ accountability. We want to ensure that justice is done to the thousands of home buyers across Karnataka.”
[This article is based on a press release from Namma Bengaluru Foundation, and has been published here with minimal edits.]