What RERA? Wait for a home continues for many buyers in Bengaluru

Home buyers have been awaiting possession of their flats for years on end, while the developers have not complied with RERA tribunal’s orders.
An overhead shot of buildings in Bengaluru
An overhead shot of buildings in Bengaluru
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Sai Pramod, a 43-year-old software engineer in Bengaluru, had booked an apartment in 2014 with a prominent developer in Bengaluru, paying Rs 1.6 crore by obtaining a bank loan. The apartment was to be handed over in 2016, but it has been over six years since he paid money for a house and yet, he is not in possession of the apartment. 

Sai Pramod approached the Karnataka Real Estate Regulatory Authority (K-RERA) in 2016 by filing a complaint stating that the developer had not handed over the apartment. The property is located in Hennur Main Road and the developer has not provided amenities, including water supply, electricity, lifts and Sewage Treatment plant. 

The developer had promised to pay the EMI for the bank loan until the property is handed over to Sai Pramod. The payments were made regularly until the end of 2016 and it stopped from the following year. Sai Pramod now lives in a rented house in Srinivasa Nagar and is struggling to pay both the rent and EMI. “Now the construction of the house is complete but without any maintenance or people living there, it looks like a dilapidated mansion. How can we live there? I have paid over Rs 1 crore for this,” Sai Pramod said. 

When Sai Pramod approached the K-RERA in 2017, the authority heard the case and a single bench tribunal had passed an order, stating that the money must be refunded by the developer. 

He filed a complaint with the Cubbon Park Police almost two years ago when the developer did not comply with K-RERA’s order. “The police did nothing about the case. They just let it go cold,” Sai Pramod said. The techie has run from pillar to post for over four years and is yet to be compensated, he said. He has filed a petition with the K-RERA’s appellate authority and is awaiting justice.

So, what is RERA’s purpose?

Speaking to TNM, MS Shankar, Secretary of the Forum for People’s Collective, an association of home buyers in Bengaluru, said that the primary issue with the existing system is that RERA has been lax in taking developers to task. 

“The purpose of RERA was to have more transparency and accountability. Quarterly report was introduced for this purpose. With respect to every status like NOC, pending approvals, construction status, these quarterly reports would give buyers an accurate picture of what is happening. Every quarter, they are supposed to upload it on the RERA website. But this is rarely enforced. They only send notices and wait for the developers to comply without taking action,” MS Shankar said. 

Of the 3,600 developers registered with K-RERA, 1,437 of them have not filed quarterly reports with the authority, mandated under the RERA Act, 2016 to ensure that the authority and the buyers are aware of the stages of construction. According to data from K-RERA, there are 4,399 ongoing projects. However, till date, 4,800 complaints were filed regarding non-completion of construction and the buyers had said that they were not in possession of the houses. Of these complaints, orders were passed in 2,448 cases, said Lalitha Kumari, Secretary of K-RERA. She said that of the orders that were passed, 450 of the petitioners came back with appeals stating that K-RERA’s orders were not complied with. 

“Currently, we have issued notices to the builders in the appeals made. They will have to send their replies by December 30. If not, we will begin criminal proceedings against them,” Lalitha Kumari said. 

She further stated that RERA began a new process to track cases. RERA will now follow up with petitioners 60 days after the orders have been passed to find out if the developers complied with said orders. “We have just started this. But it is not within our jurisdiction to enforce it, the Revenue Department should since we are a quasi-judicial authority and the orders passed here can be appealed in the High Court and Supreme Court,” she added. 

Problems with accountability

Rajesh Kumar, a 35-year-old marketing manager with a multinational company in Bengaluru, had paid Rs 65 lakh in March 2018, for an apartment in Whitefield near Hope Farm. When he made the payment for the house in a gated community, the developer had informed him that the house would be ready for possession in June 2018 with a grace period of six months. He was to be in possession of his apartment by December 2018. Rajesh Kumar was to procure a bank loan before he made a payment in March 2018. Due to difficulties with the bank, he could not pay the developer the money as requested in January 2018. With this in mind, the developer allegedly informed him that the delay in payment was the reason why he was not in possession of his flat. 

In return, the developer sent him a notice to pay 24% interest on the total cost of the house as penalty for delayed payment. “That’s why I took it to RERA in April 2019. In September 2019, my case was referred to the three-bench tribunal. We found that the builder had not even registered details of our agreement with RERA,” Rajesh Kumar said. 

After multiple delays due to the developer not appearing for hearings, a single-bench tribunal passed an order in January this year, stating that the developer was liable to return the money paid by Rakesh along with 10% interest. Since the case was heard by a three-bench tribunal, and the order was passed by a single-bench one, the developer informed Rajesh Kumar that they were not liable to return his money. He claims that the developer wants him to withdraw the case and pay the 24% interest for delayed payment if he has to get his apartment. 

“They want me to settle the case on their terms. Why should I? I had informed them every step of the way about the problems with the bank and they never mentioned anything about a penalty in the agreement. Why should I pay them more?” he questioned. He has now filed an appeal with K-RERA and is awaiting order. 

Rajesh Kumar said that the Revenue Department officials have been unresponsive to multiple pleas. “They are hand in glove with the builders. How many times should we keep asking them to enforce orders? I am determined to fight this legal battle to see how long it will take for me to get justice. This should show everyone how RERA is not being enforced properly. Why have no criminal proceedings begun against those who are not complying with orders?” he questioned. 

Shankar maintained that RERA must set examples by taking action against developers who fail to comply with its orders. Or identify the Revenue Department officials, who are reluctant to enforce RERA’s orders. “If no action is ever taken, then developers will not bother about anything. Ultimately, it is the buyers who suffer. The state government must look into this seriously and ensure that the orders are enforced,” he added. 

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