Introduction

The case of Dr. Anjali Sharma v. Gupta Builders And Promoters Private Limited before the Real Estate Regulatory Authority (RERA) of Punjab addresses a pivotal issue in real estate regulation: the jurisdiction of RERA over real estate projects that are not registered with the Authority. This comprehensive commentary explores the background of the case, the Authority's judgment, and its implications on the real estate sector.

Summary of the Judgment

On January 12, 2022, RERA Punjab delivered a landmark decision dismissing 13 complaints filed against various real estate developers concerning unregistered projects. The core issue revolved around whether RERA could entertain complaints related to projects not registered under its purview, especially in light of the Supreme Court of India's judgment in Newtech Promoters and Developers Pvt. Ltd. vs State of U.P. and Ors. RERA concluded that only ongoing and future projects registered under the Act are subject to its regulations, thereby excluding unregistered projects from its jurisdiction.

Analysis

Precedents Cited

The Authority referenced several key cases to underpin its decision:

• Bikramjit Singh and Ors. Vs. State of Punjab and Ors. (13.12.2017): Determined that RERA could not entertain complaints against unregistered projects.
• M/s Silver City Construction Ltd. vs. State of Punjab and Ors. (24.07.2019): Overruled the previous decision, allowing RERA to hear complaints against both registered and unregistered projects.
• Newtech Promoters and Developers Pvt. Ltd. vs State of U.P. and Ors.: A Supreme Court judgment that ultimately influenced RERA Punjab to restrict its jurisdiction to registered projects.

These precedents illustrate the evolving interpretation of RERA's scope, culminating in the current restriction based on the latest Supreme Court guidance.

Legal Reasoning

The Authority delved into whether the Real Estate (Regulation and Development) Act, 2016 is retroactive or retrospective. The Supreme Court held that the Act is retroactive, meaning it applies to ongoing and future projects but does not affect completed projects or those not yet registered. RERA Punjab interpreted this to mean that only projects registered under Section 3 of the Act fall within its regulatory ambit.

Additionally, arguments suggesting that projects with a Change of Land Use (CLU) should be considered registered were dismissed. The Authority reasoned that obtaining a CLU is merely an early stage in project development and does not equate to full registration under RERA.

Impact

This judgment significantly narrows RERA Punjab's regulatory scope. Developers of unregistered projects are no longer accountable to RERA, potentially leaving consumers with limited recourse in disputes. It underscores the importance for developers to register their projects promptly to ensure they fall under RERA's protective framework. Conversely, it raises concerns about the oversight of a substantial segment of the real estate market operating outside RERA's jurisdiction.

Complex Concepts Simplified

Retroactive vs. Retrospective

Retroactive: The law applies to events that occurred before its enactment but does not affect vested rights existing before the law came into effect.
Retrospective: The law applies to events that occurred before its enactment and can alter or influence rights and obligations that were established prior to the law.

Change of Land Use (CLU)

A CLU is a government approval that allows the conversion of land from one use to another, such as from agricultural to residential. It is a prerequisite step in real estate development but does not constitute full project registration under RERA.

Conclusion

The RERA Punjab judgment in Dr. Anjali Sharma v. Gupta Builders And Promoters Pvt. Ltd. establishes a clear boundary for the Authority's jurisdiction, confining it to registered projects. This decision aligns with the Supreme Court's stance in the Newtech case, reinforcing the necessity for developers to adhere to registration requirements under the Real Estate (Regulation and Development) Act, 2016. While this may streamline regulatory processes for RERA, it also emphasizes the need for vigilant registration practices to ensure comprehensive consumer protection in the real estate sector.