Homebuyers' Body Objects to MahaRERA's Conciliation Forum, Cites Conflict of Interest
Maharashtra Real Estate Regulatory Authority's decision to set up a conciliation forum to settle disputes between homebuyers and builders has been opposed by a pan-India homebuyers' body, Forum for Peoples' Collective Efforts.
MahareraReraHomebuyersBuildersConciliation ForumConflict Of InterestReal EstateAug 25, 2024
The letter, written by FPCE President Abhay Upadhyay to the union ministry of housing and urban affairs' additional secretary Satinder Pal Singh, states that MahaRERA has exceeded its brief under the Real Estate (Regulation and Development) Act 2016 (RERA) by constituting such a forum.
According to the letter, Section 32 of RERA merely gives power of recommendations to the Authorities and not the power to constitute such a forum itself. The section states that dispute settlement forums are to be set up by consumer or promoter associations, not by RERA Authorities.
MahaRERA has not only constituted a Conciliation Forum but is also part of it, with the Secretary of MahaRERA as the Chairperson of the forum. This, the FPCE says, is a clear case of conflict of interest.
The association pointed out that the composition of the Conciliation Forum is also biased in favor of builders, with only one organization representing consumers and three organizations representing builders.
The FPCE has called upon the ministry to investigate the constitution of the forum, its functioning, and the orders passed so far to ascertain whether the forum is favoring real estate developers.
The association has suggested that the ministry should issue guidelines to states after due consultations with all stakeholders for the constitution and working of a conciliation forum. It is essential to ensure that the conciliation forum is independent, uniform, and comprises impartial persons of repute.
The FPCE also suggested that RERA authorities should not be directly or indirectly part of such a conciliation forum to avoid any possible conflict of interest.
Instead of conciliation forums, Lok Adalats should be encouraged, the letter said. If Lok Adalats are functional in any state, they should be encouraged in place of a conciliation forum, as the orders passed by Lok Adalats have much more legal validity and credibility.
Frequently Asked Questions
What is the issue with MahaRERA setting up a conciliation forum?
MahaRERA has exceeded its brief under the Real Estate (Regulation and Development) Act 2016 (RERA) by constituting such a forum, which can lead to a conflict of interest.
What is the composition of the Conciliation Forum?
The forum has only one organization representing consumers and three organizations representing builders, which is biased in favor of builders.
What is the FPCE's suggestion to the ministry?
The FPCE has suggested that the ministry should issue guidelines to states after due consultations with all stakeholders for the constitution and working of a conciliation forum.
What is the alternative to conciliation forums suggested by the FPCE?
The FPCE has suggested that Lok Adalats should be encouraged instead of conciliation forums, as the orders passed by Lok Adalats have much more legal validity and credibility.
What is the main concern of the FPCE regarding the conciliation forum?
The FPCE is concerned that the conciliation forum may favor real estate developers, leading to a conflict of interest.
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