Model Builder-Buyer Agreement : Supreme Court Asks Union To Scrutinize State RERA Rules For Essential Norms

On a plea seeking a direction to the Centre to frame model builder-buyer and agent-buyer agreements to ensure uniformity across the country, the Supreme Court on Monday ordered that the Union Ministry of Housing shall scrutinise the state rules, notified in pursuance of the Centre's Real Estate (Regulation and Development) General Rules, 2016 and the Real Estate (Regulation and Development) Agreement for Sale Rules, 2016, and place a report on whether the former comply with the substratum of the Rules of 2016.The Court also requested Advocate Devashish Bharuka to assist the court as Amicus Curiae. "Mr Bharuka shall also assist in carrying out this exercise. ASG Aishwarya Bhati who has suggested this course of action states that all necessary facilities will be granted so that Mr Bharuka shall in coordination with the Union Ministry of Housing place a statement before this court on the aspects which have been referred to above", said the Court.The bench of Justices D. Y. Chandrachud and Surya Kant had noted that the Union of India through the Ministry of Housing and Urban Affairs has filed a compilation of additional documents containing inter-alia the aggregated statement of Rules under the RERA. "On 5 November 2016, the union government, being the appropriate government, notified the Real Estate (Regulation and Development) General Rules, 2016 and the Real Estate (Regulation and Development) Agreement for Sale Rules, 2016. All the states were requested to forward copies of the rules as notified. The statement which has been placed on record indicates that while the General Rules and the Agreement to Sell rules have been notified by various states, compliance is yet to be effected inter alia by the state of West Bengal and by some of the north-eastern states besides Jammu and Kashmir", recorded the bench.The bench went on to dictate in its order that "at the present stage, it is necessary for the court to be apprised of whether the rules which have been framed by the states contain the essential norms which have been adopted by the Union Government in the rules of 2016 referred to above, or whether there are any deviations which would not subserve the interest of the flat purchasers.""This exercise in our view should be carried out at two levels", said the bench, issuing the aforesaid directions to the Union Ministry of Housing and the Amicus. Granting 2 months for the completion of the exercise, the bench posted the matter for April.On Monday, ASG Aishwarya Bhati told the bench, "The model builder-buyer agreement has already been circulated and adopted. We said so in the counter affidavit also. It was not correctly brought to Your Lordships' notice. Under the RERA act, for all the union territories which do not have a legislature, the onus was on the central government to prescribe the agreement. We have placed that on record now. The model agreement for sale starts at page 25. It is fairly comprehensive. The conditions include that the promoter has obtained final layout plan, sanction plan, specifications and approvals for the project- also for the apartment, plot or building, as the case maybe...These are called Chandigarh Real Estate (Regulation and Development) Agreement for Sale Rules, 2016. On the same lines, there are rules for all the union territories without a legislature...we have placed the implementation status of these rules by the various states"Justice Surya Kant noted, "except 2-3 small states, the rest of the states have notified.""Jammu and Kashmir and Ladakh got delayed because of the notification as UT. Manipur, Meghalaya and Nagaland are also yet to notify...We are in direct conversation with them. These are the border areas where rarel new real estate projects are there. But this will also be achieved quickly. West Bengal also remains", replied the ASGJustice Surya Kant asked, "Have you broadly examined these rules that these are based on the model rules circulated by the central government?"The ASG replied, "The officers made the comparison and explained to me the differences in the rules of Maharashtra and Haryana. We found that Maharashtra is broadly on the same lines as the model rules though they had made inclusion of the slum development or redevelopment project. Haryana is also on the same lines. Haryana has added something very interesting. They have prescribed the ratio which the builder cannot exceed on the basis of the construction"Justice Chandrachud noted that "there has to be local variation". Justice Surya Kant also agreed that local conditions will have to be provided for, so long as additional provisions incorporated by Maharashtra, Haryana etc are for the favour and protection of the buyers and consumers.Senior Advocate Maneka Guruswamy, on the petitioners' side, advanced, "Ms. Bhati has very skilfully reiterated the previous position of the union government. Every state government has its own set of rules. That is the very point of these petitions- this nature of ...

Model Builder-Buyer Agreement : Supreme Court Asks Union To Scrutinize State RERA Rules For Essential Norms

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