Supreme court directed central government to frame model builder-buyer agreement


Status as on- 5/10/2021


Last year a PIL was filed by Advocate Ashwini Kumar Upadhyay under Article 32 of the Constitution against the increasing number of complaints due to absence of uniform Builder-Buyer and Agent-Buyer Agreements. Section 41 of RERA Act provides to establishment of a Central Advisory Council by the Union government and Section 42 provides the functions to be performed by the council. The Act provides sufficient enabling powers to the Central Government to frame model agreements.

PIL was filed to seek out the direction to the Central government to build model builders and agent buyers agreement to protect homebuyer’s rights and to protect them from mental, physical, and financial injury and bring in transparency in the Real Estate Sector.

Direction issued to Central Government to Frame Model BBA in W.P.(C) No. 1216/2020

In pursuance of that PIL, the apex court with a bench of Justice Shri D Y Chandrachud and Justice Shri B V Nagarathna issued notice to center government have a Model Builder-Buyer Agreement in the Real Estate Sector to safeguard the interest of homebuyers against the builder’s unfair practices. These days’ builders or developers mention several unfair terms and conditions or clauses in the agreements to take advantage of the homebuyers.

The bench stated that

It is very important for consumer protection, because builders try to put any number of clauses in the agreement which common people may not be aware of. There should be some uniformity in the agreement. It is important that this (model builder buyer agreement) is achieved in the country,”.

As nowadays the builder or developers attempt to manipulate the conditions to be incorporated. Therefore, it was suggested that the Centre government should prepare a Model Builder Buyer Agreement and direct all states to implement such model agreement to protect the homebuyers concern and to get uniformity and to bring transparency in Real Estate Sector and in RERA, 2016.

The developers and builders are deliberately undertaking excessive delays in the possession of the units/flats which ultimately affecting the homebuyer’s financial and mental stability. All such actions of builders are arbitrary and constitute an unfair restrictive trade practice and amount to criminal conspiracy, fraud, cheating, criminal breach of trust, dishonestly inducing delivery of the property and dishonest misappropriation of property.


To seek out transparency and uniformity and to protect the interest of homebuyers and consumers from builders’ unfair practices, it is important to frame a model builder-buyer agreement. Such a model agreement would aid buyers from being exploited by the developers or builders.


Disclaimer-  The above article is based on the personal interpretation of the related orders and laws. The readers are expected to take expert opinion before relying upon the article. For more information, please contact us at

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