Power of RERA to extend completion date in case of Builder


STATUS AS ON 21/05/2019

Real Estate Regulatory and Development Act,2016 was enacted partially in the year 2016 and fully in the year 2017. The Act is split between two main objectives one that of Regulating the Real Estate Sector and the other of imparting justice to the aggrieved parties whether homebuyers or promoters.

That in terms of regulating the Real Estate Sector the Act provides for the provision of registration of ongoing Real Estate Project under Section-3 of the Act. Now, when project registration is seeked under this provision then a detailed form and information is provided as per the respective state rules. One such undertaking is in terms of date of completion which the promoter gives. This date of completion creates a strict timeline on the promoter and the same is part of public record in all major states. Now, the question that arises is what if the developer or promoter fails to complete the construction as per the given date? What if due to some unseen circumstances or force majeure the builder is not able to meet the committed date?

The answer lies in Section-6 of the RERA Act which gives power to the Authority to extend the date of completion for a period of one year. Now, let us look at the operation of this Section. The Section gives two conditions one that of force Majeure and one where there is no such situation but the builder still seeks extension. The Authority can grant extension in non-Force Majeure condition also by recording its reasons in writing and the same cannot be done for more than one year.

Further, to bring Section-6 into practicality different states have implemented individual procedure and rules. The problem though arises on two major aspects. First, there being online portals the same do not have any specific process for applying thus leaving all promoters baffled. Second, there is huge issue with respect to fees that has to be paid in case of extension. There is still a lot of confusion in all states with regard to the same. Thus, the best way to go around the same is by consulting a lawyer or expert in the files of RERA in order to safeguard unnecessary hustle and time.

This safeguarding provision is like oasis in desert for all builders and promoters throughout the country. The promoters can themselves seek this liberty by moving an application before the Hon’ble Authorities.

Disclaimer – Please note that the above articles is based on the interpretation of related laws and judicial pronouncement which may differ from person to person. The reader are expected to take the expert opinion on the matter.

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