RERA Does Not Bar Homebuyers’ Complaint Under Consumer Protection Act Against Builder/Developer: NCDRC

The National Consumer Disputes Redressal Commission (NCDRC) has held that Real Estate (Regulation and Development) Act 2016 (RERA) does not bar filing of a complaint under the Consumer Protection Act 1986 against a builder/developer. The bench headed by Justice R K Agrawal was dealing with a batch of complaints filed by homebuyers for compensation from Today Homes & Infrastructure Pvt Ltd for not delivering possession of flats within the stipulated time. The builder/developer raised preliminary objections against the maintainability of complaints on two grounds : After the commencement of RERA, consumer complaint was not maintainable, as Section 79 of RERA bars jurisdiction of civil courts. The arbitration clause in the agreements with buyers excluded jurisdiction of consumer forum. Rejecting these objections, the Commission held that Consumer Protection Act was a special enactment, which provided a special remedy to an aggrieved consumer. The authorities under Consumer Protection Act cannot be regarded as “civil courts” and hence Section 79 of RERA did not apply. Further, Arbitration agreement does not bar consumer complaint. Referring to the recent SC decision in Emaar MGF Land Ltd. vs. Aftab Singh, the Commission held that the fact that Arbitration can be proceeded under the Arbitration and Conciliation Act, 1986 is not a ground to restrain the Consumer Fora from proceeding with the Complaints.

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