Centre proposes to submit before Supreme Court a model builder-buyer agreement with mandatory RERA clauses

The Central Government in the case Ashwini Kumar Upadhyay versus Union of India observed and has proposed to submit before the Supreme Court a model builder-buyer agreement with mandatory clauses which cannot be altered by the Union Territories or the States.

Before the Court, Additional Solicitor General Aiswharya Bhati and amicus curiae Devashish Bharuka submitted that the Court that the model agreement will have Part A which will have core clauses with the mandatory provisions of the Real Estate (Regulation and Development) Act 2016 for the purpose of protection of the home buyers and the Part B which will contain additional clauses as per the requirements of the individual UTs /States. Thereafter, these additional clauses will not be contrary to or dilute in any manner the clauses in Part ‘A’.

The bench comprising of Justice DY Chandrachud and the Justice Hima Kohli observed and has posted the matter for further consideration on November 28, while taking the note of these submissions.

It stated that the development happened in the PIL filed by Ashwini Upadhyay seeking a model builder-buyer agreement. Earlier, it was observed by the Supreme Court that a model agreement was necessary to protect the interests of home buyers and had asked the Union to frame a model agreement after taking inputs from the States. Later, it was asked by Court to the Union to scrutinize the rules framed by the States under RERA to ascertain if essential norms have been incorporated.

Further, it was observed that on September 30, the following States have not submitted their responses:

(i)Andhra Pradesh; (ii) Gujarat; (iii) Chhattisgarh; (iv) Jharkhand;(v) Madhya Pradesh;(vi) Maharashtra;(vii) Manipur;(viii) Mizoram;(ix) Odisha;(x) West Bengal; and (xi) Uttar Pradesh.

On the other hand, the response has been filled by the thirteen States and two Union Territories. 

Thus, the States which have not filed their responses were directed to do so positively within a period of four weeks and failing which the Principal Secretaries of the State Government in the Ministry of Affairs/Urban Development shall personally remain present before the Court on the next date of hearing and to explain as to why they should have not been proceeded with under the coercive arm of the law created.

The court was informed by the Haryana and Maharashtra wings of the Confederation of Real Estate Developers Associations of India (CREDAI) that they will give their responses.