Consumer Bodies Demand Strict Action Against Real Estate Frauds in Telangana

Consumer activists in Telangana are urging the state government to take immediate action to curb the rising number of real estate frauds, strengthen safeguards, and ensure that buyers receive adequate compensation. This call comes amid growing concerns over the lack of effective measures to protect consumers from fraudulent practices in the real estate sector.

Speaking at a meeting held in Hyderabad, Dr. Pallepadu Damodar, president of the Southern States Consumer Coordination Committee, emphasized the need for the state government and officials to take immediate action against real estate frauds. He noted that while the Telangana Real Estate Regulatory Authority (TGRERA) has been prompt in responding to frauds and imposing penalties, consumers are still not receiving adequate compensation for their losses.

Dr. Damodar stressed that merely imposing penalties is not enough; it is essential to ensure that proper permissions are granted before the construction of apartment complexes begins. He also called for strict action against real estate firms that engage in fraudulent advertising practices.

Consumer Confederation of India (CCI) national general secretary Sambaraju Chakrapani highlighted the importance of maintaining the mandatory security deposit requirements. Under the HMDA Act of 2008, it was mandatory to mortgage 15 percent of the property as a security deposit with the government during apartment construction. Subsequent amendments reduced this requirement from 15 percent to 10 percent, and efforts are currently underway to further reduce it to just 5 percent.

Chakrapani argued that a 5 percent property security deposit would primarily benefit the real estate sector while causing severe financial loss to consumers. Therefore, consumer associations are registering their protest against such amendments, as they believe it would compromise consumer protection.

AV Rao, vice president of CCI, and other members of the organization, including secretary Ande Sridhar Reddy and joint secretary S Narasimha Reddy, demanded that approximately 64 real estate firms, which have failed to pay the fines imposed by TGRERA, be blacklisted. They emphasized that blacklisting these firms would serve as a deterrent against future fraudulent practices and help restore consumer confidence in the real estate market.

The consumer bodies are also opposing any reduction in the mandatory security deposit, arguing that it is a crucial safeguard for buyers. They believe that maintaining a higher security deposit requirement will ensure that real estate developers are held accountable for their actions and that consumers are protected from financial losses.

In conclusion, consumer activists are urging the Telangana government to take a multi-faceted approach to combat real estate frauds. This includes strengthening regulatory mechanisms, ensuring timely compensation for affected buyers, and taking strict action against defaulting firms. By implementing these measures, the government can help restore trust in the real estate sector and protect the interests of consumers.