COVID 19 AND ITS IMPACT ON REAL ESTATE REGULATORY ACT (RERA)

The Real Estate (Regulation and Development) Act, 2016 provides for the RERA, which seeks to establish a real estate regulatory body in every state and also involves a dispute resolution mechanism, which allows it to regulate the real estate sector. 

The main contention of RERA is to provide protection to home buyers. It obligates real estate builders to employ the best quality materials, provide and update the customers about the construction process from time to time, hand over the possession of the house according to the mentioned date, and perform all the other related activities according to the RERA rules and regulations.

The RERA is different for every state, as provided in the Real Estate (Regulation and Development) Act. This implies that all states formulate different guidelines for their real estate sector, depending upon the level and kind of infrastructure within the city or state, as well as the supply of materials, machinery, manpower etc,. 

With the advent of the COVID-19 pandemic, almost all sectors of the economy have been hit drastically, especially the real estate sector. Since the lockdown has begun, the supply of raw materials, the labourers, machines etc., has been stopped completely, in light of the lockdown which has been imposed by the Indian government. 

This can be highlighted by the Maharashtra government’s decision concerning MahaRERA, which has laid down extension guidelines of all real estate projects, to a time period of three months.

Initially, the Maharashtra government imposed the lockdown, on a state level, in parts, due to the increasing number of cases, so as to make sure that there was a constant flow of workforce, at all times, without making a large proportion of people prone to the virus. However, as soon as the lockdown was imposed, the government had no choice but to stop all the on-going projects, and as a result, led to their stoppage mid way.

With the discontinuation of work, the home buyers, now have no choice but to wait for their residential spaces, till the lockdown is over and the construction work can resume again. Moreover, the clause of force majeure has been included under section 6 of the Real Estate (Regulation and Development) Act, so it becomes difficult to determine whether such buyers will have the right to file a suit against any real estate developers for the delay of possession.