RERA has the jurisdiction to entertain a complaint filed by an aggrieved person against the bank as a secured creditor

 In the matter of Union Bank of India, Jaipur vs. Rajasthan Real Estate Regulatory Authority & Ors., D.B. Civil Writ Petition No. 13688/2021 & 69 other connected Writ Petitions A divisional bench of the Rajasthan High Court  held that the RERA has the jurisdiction to entertain a complaint filed by an aggrieved person against the bank as a secured creditor. In this behalf, the Rajasthan HC observed that lenders such as banks who have entered into securitized transactions have the power in case of default under the SARFAESI Act to enforce their security interest through various measures such as taking possession of the secured assets, taking over management of the business of the borrower, etc. It was held that oncethe bank takes such actions for enforcing their security interest in terms of Section 13(4) of the SARFAESI Act, the secured creditor for all purposes enters into the shoes of the borrower/promoter as there is an assignment of statutory rights in favour of the lender.

The Rajasthan HC held that the RERA Act would have no retrospective application to transactions completed between the borrower (developer in such cases) and the lender (banks/financial institutions) wherein security interest has been created prior to the RERA Act. The RERA Act can have retrospective application only when the creation of security interest was made fraudulently or in collusion with the bank/financial institutions.

The Rajasthan HC observed that both the RERA Act and the SARFAESI Act are special laws. Whilst relying on the order of Bikram Chatterji and Ors. Vs. Union of India 2019 19 SCC 161, the Rajasthan HC concluded that in case of a conflict between two special laws, the special law that was enacted later would prevail. Since,the RERA Act was enacted subsequent to the SARFAESI Act, the provisions of RERA Act would prevail over the provisions of SARFAESI Act.

THE SUPREME COURT OF INDIA in the matter of UNION BANK OF INDIA

VERSUS RAJASTHAN REAL ESTATE REGULATORY AUTHORITY & ORS. ETC. ETC. Petition for Special Leave to Appeal (C) Nos.1861-1871/2022; Dated 14-02-2022 has ratified the above order of the Rajasthan High Court.

Even if the Project is completed with occupancy Certificate and does not require Rera Registration, even then the Promoter is bound by the responsibilities assigned under the act.

In the Matter of Raghunath MS vs. Esteem Group Complaint no. CMP/180620/0000936  decided on 14.11.2019 before  Karnataka Real Estate Regulatory Authority

In this case, the project was completed and conveyed to the association of allottees prior to the commencement of the Act. The allottee had purchased the unit from an erstwhile allottee. The developer contended that since the project was completed before the commencement of the Act and the occupancy certificate was obtained, they cannot be bound by the provisions of the Act. Referring to the Preamble of the Act, Karnataka RERA held that even if the project was completed prior to the commencement of the Act, the developer is bound by the provisions of the Act. Accordingly, Karnataka RERA directed the developer to hand over all documents and execute a registered deed to include civic amenities in favour of the association of allottees.

RERA to have jurisdiction even where agreement for sale is cancelled prior to RERA ; Scope of RERA also extends to disputes arising prior to RERA, where consideration paid to developers was still with them, even after RERA came into force

 In the Matter of Champatlal Jain, Parvin Dumasia and 6 Others vs Suriti Developers Private Limited Complaint no. decided on 04.06.2018 Before Maharashtra Real Estate Regulatory Authority

The Complainants had purchased apartments in Respondent's project Universal Paradise in Mumbai, between 2007 and 2013.The Complainants stated that registered agreements for sale (Agreements for Sale) were entered into with the Respondent for purchasing the apartments and that sometime in February 2017, the Respondent unilaterally cancelled the Agreements for Sale. Aggrieved by the termination notices, the Complainants approached the MahaRERA seeking that the Agreements for Sale ought to be declared valid, legal, subsisting and binding.

The Complaint was disposed of by the MahaRERA stating That though the Agreements for Sale were cancelled by the Respondent before the RERA came into force, in view of the fact that the consideration paid by the Complainants was still with the Respondent, the MahaRERA had complete jurisdiction to hear and adjudicate the complaint. if the Complainants chose to continue, both parties should execute the Agreements for Sale in accordance with Section 13 of the RERA and in addition, do so within 45 (forty-five) days from the date of the Order.

The Order has clarified that the scope of RERA also extends to disputes arising prior to RERA, where consideration paid to developers was still with them, after RERA came into force.