Legal Remedies for Struck Properties and Projects: Best Real Estate Attorney Advice in Delhi NCR
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“RERA” has brought a great relief for the homebuyers who have been wandering from post to pillar for their struck properties in different struck projects. The best legal advice before purchasing a property is to ensure that the property which is the homebuyer or investor is buying is RERA registered. A homebuyer or investor should not invest into any project before consulting a proficient real estate attorney and only after conducting a proper real estate due diligence and into a project which is RERA registered.”
Real Estate (Regulation and Development) Act, 2016 (hereinafter referred as “RERA Act”) came into force in the year 2017 and at the time of implementation of this Act many Real Estate projects were stalled and many buyers invested into these projects. The problem was that they were neither given the possession over these Real Estate as per the agreement they entered into and nor got a refund of their invested money.
First, we need to know what is stuck or stalled project- Usually a project is deemed to be stalled or stuck project if-
– There is an extra-ordinary delay in delivery of project (as we know a real estate project can take some years to be completed. So, a normal delay can be accepted but if there is extra ordinary delay, then it became the issue of concern)
– The developer of the project is either not reachable or absconded
– The work of development is going on very low pace or stopped altogether
– There is legal issue regarding the project either between land owner and developer or other authorities
Now, it doesn’t mean that there is no solution for this problem, the said Act also provide provision for such situation to help out these buyers. They are as follows:
1. Remedies Under RERA Act
– Taking possessive of the property along with penalty and delayed interest
– Withdrawal from that Real Estate Project invested by the buyer
2. Remedies Under Insolvency and Bankruptcy Code,2016
– Remedy through National Company Law Tribunal (NCLT)
Taking possessive of the property along with penalty and delayed interest
It sucks for a buyer to face a long delay in possession over a property for which he/she have already paid. In case the buyer still wants the invested project, then he/she can avail remedy provided under Section 18 of the RERA Act. It says, if the promoter fails to give possession of the estate as agreed in the agreement of sale or because of the reason of discontinuance of his business as a developer because of suspension or revocation of the registration under the Act or for any other reason and the buyer doesn’t want to withdraw from the project, then the developer will be liable to pay the interest amount every month till the time the possession is not handed over to the buyer.
In case of loss incurred by buyer because of defective title of land on which the project is being developed or already developed, the buyer can claim for compensation for the same. Other than this, Section 18 of the Act also provides that if the promoter fails to discharge any other obligations of his as decided and imposed on him/her, then also he/she have to pay compensation to the buyer.
Section 31 of the RERA Act talks about the procedure for filing a complaint. According to this section a complaint can be filed against promoter, real estate agent and allottee through an Advocate, Company Secretary (CS), Chartered Accountant (CA) or by himself/herself also to the concerned RERA Authority. The said concerned authority will review the complaint application and if deemed fit then will issue notice to the builder to show cause on the disputed matter. The builder will have to proof why the remedy provided under section 18 should not be given to the complainant. It means the burden of proof lies on Builder. If the builder fails to prove it then the buyer will get the possession right along with the interest on delayed period and imposed penalty.
Withdrawal from that Real Estate Project invested by the Buyer
Section 18 of the Act also provides for the withdrawal from the project. The procedure for filing of the complaint will be same as given in section 31 mentioned above and then if the case is proved the buyer will get the refund of invested money and be allowed to withdraw from the Project.
Remedy through NCLT
Homebuyers are recognized as “financial creditors” under Section 5(8) of the Insolvency and Bankruptcy Code and can file petition under section 7 of the said Code. It says if there is at least 100 buyers of the project or 10 percent if total allotters, they can approach the NCLT under section 7.
Therefore, there are a lot of legal remedies available to a homebuyer or an investor when they put their hard earned money in a property which is duly registered under RERA. Having said that a legal consultation from a reputed and proficient property lawyer or a real estate attorney should be obtained before moving ahead.
The legal remedies are there if a buyer is stuck in one of these Real Estate Projects. The remedy provide through NCLT is more efficient and quicker and buyers can avail it if come together or if not, then remedy provided by RERA Act is always there.
Authored By: Adv. Anant Sharma & Anjali Swami