The Forum for People's Collective Efforts proposed a National Appellate Tribunal for Real Estate on November 12. The body submitted these changes to Cabinet Secretariat officials to strengthen consumer protection. They want legally binding sale agreements, automatic compensation for project delays, and a statutory exit mechanism for all frustrated homebuyers.
Homebuyers' body FPCE has proposed changes to the RERA Act, including a National Appellate Tribunal for Real Estate, legally binding sale agreements, a statutory exit mechanism and automatic compensation for project delays or deficiencies. The proposals were submitted to Cabinet Secretariat officials on November 12.
The Forum for People's Collective Efforts (FPCE), a national homebuyers' body, has proposed a series of changes to strengthen consumer protection in the real estate sector, including setting up a National Appellate Tribunal for Real Estate, making agreements for sale legally binding under the RERA Act and introducing a statutory exit mechanism for homebuyers.
The proposals were submitted to officials of the Cabinet Secretariat during a meeting on November 12, following a response from Cabinet Secretary to the organisation's earlier letter to Prime Minister Narendra Modi seeking reforms to the Real Estate (Regulation and Development) Act, 2016.
An FPCE delegation comprising its president Abhay Upadhyay and members Ratul Mazumder and Jai Pal Raheja presented the suggestions, which also include making real estate regulatory authorities accountable through periodic audits and ensuring automatic compensation to allottees in cases of project delays or deficiencies.
FPCE has proposed establishing a National Appellate Tribunal for Real Estate (NATRE) in Delhi in place of state-level appellate tribunals, with appeals against its decisions lying directly with the Supreme Court.
It said different interpretations of the same central legislation across states have resulted in inconsistent protection for homebuyers. The proposed tribunal would also hear appeals against orders passed by regulatory authorities and adjudicating officers, with virtual benches to avoid requiring homebuyers to travel to Delhi.
The organisation has also sought amendments to Section 13(2) of RERA to place the Agreement for Sale in a schedule to the Act, making it binding. It said the present provision allows state governments to prescribe its format through rules, enabling developers to incorporate clauses that dilute homebuyer protection.
On homebuyer cancellations, FPCE has proposed a statutory exit mechanism under which buyers cancelling within one year of booking would receive a full refund within one month. For cancellations thereafter, it has suggested a refund of the entire amount along with interest at the State Bank of India savings account rate.
The body has further called for regular audits of state regulatory authorities, independent scrutiny of a sample of their orders and publication of audit findings. It has also proposed automatic compensation to allottees in delayed or deficient projects, without requiring individual complaints or lengthy legal proceedings.
FPCE reiterated its broader proposal to separate real estate sector promotion from homebuyer protection.
Under its suggested framework, promotion and development would remain with the Ministry of Housing and Urban Affairs and development agencies, while consumer protection would be governed by a dedicated Real Estate Homebuyer Protection Act administered by a ministry responsible for consumer affairs.
According to FPCE, several practices that RERA was intended to address, including diversion of homebuyers' funds, possession delays, unilateral agreements and incomplete amenities, continue to persist even after a decade of the legislation.