Real Estate (Regulation and Development) Act, 2016 (RERA):
A recently promulgated legislation, RERA seeks tocurb the shortcomingsof respective Ownership Acts prevailing in each state. A centre enacted legislation, RERA seeks to provide uniform laws throughout the states, for protecting the interest of home buyers and seeks to increase transparency in functioning of construction companies and reduce the chances of default or misappropriation of funds by Builders.

RERA provides for establishment of following authorities/Tribunals:
1.Real Estate Regulation Authority ("RERA Authority") in each state;
2.Real Estate Appellate Tribunal in each state.
It seeks to provide for establishment of authorities/tribunals for providing mechanisms to flat purchasers/home buyers for expeditious Redressal of complaints under the Act.
It basically and broadly provides for remedy for following breaches/contraventions by Promoter/Real Estate Agent:
1.Inviting/Offering for sale etc. without registration of project by Promoter/Developer;
2.Acting as agent or inducing/facilitating purchase by Home Buyer without registration as Real Estate agent or project being registered with Real Estate Authorities;
3.Any unfair practice being adopted by Promoter/Developer/Real Estate Agent;
4.Violation of terms and conditions by Promoter/Developer subject to which approval granted by Competent Authority;
5.Adoption of fraudulent practice by Promoter/Developer;
6.Violation of any provisions of the Act/Rules/Regulation.

Consumer Protection Act, 1986 (CPA):
CPA enacted to provide speedyRedressal mechanismto"CONSUMERS"under the CPA by establishments of Forums at District, State and National level. CPA only applies in case ofCONSUMERalleges Unfair Trade Practice or Deficiencywith respect toGoods or Services. Each of the terms are well and broadly defined under the Act. The home buyers were also included within the purview of the Act by interpreting the word "Services" under the Act to include construction, sinceconstruction is also a service.Otherwise transactions in Immovable Properties are outside the ambit of CPAsince they are not goods within the meaning of the Act. Hence transaction relating to sale /exchange of Immovable Properties, specific performance of the same, claim for damages for non-performance of agreement of sale is outside the purview of CPA since Immovable Properties arenot "goods" within the meaning of the CPA.

Insolvency and Bankruptcy Code, 2016 (IBC):
IBC was one of the most successful piece of legislation promulgated by the Parliament to provide a uniform code for Insolvency Resolution of all persons whether Individual, Partnership Firm or Corporate entity. It contains different chapters for Insolvency of different types of persons. For Corporate Entities it provides forCorporate Insolvency Resolution Process (CIRP)for 6 months to provide an opportunity to revive the Corporate Entity if Financial Creditors of the Company by requisite majority so agree by approvingResolution Planand toprevent further erosion of capitaland if possible to appreciate the capital of the Company.If CIRP fails, the Company goes into liquidationand liquidation in done in the manner provided in the IBC.

By virtue of recent amendment in August 2018, the Allottee's of project are considered and are deemed to be Financial Creditors within the meaning of the Act. Hence they are entitled to maintain Insolvency Application and in case of admission of Insolvency Application byother Creditors, Financial or Operational, are entitledto participate and votein meeting ofCommittee of Creditorsthat is constituted.

Comparing Remedy Under Rera Vs Cpa Vs Ibc On Certain Parameters From Home Buyers Perspective:

Analysis Of Provisions Relating To Granting Of Reliefs Under The Acts:
A.*By virtue of provisions ofProviso to Section 71(1)of RERA it is explicitly clear that aperson can avail one of the two remedies, either file Complaint with RERA Authority or before appropriate Consumer Forum. This is due to the fact that in both the remedies one is seeking or can seek recovery of money along with interest, compensation and costs. It proceeds onprinciple of constitution under Article 20(2)of Indian Constitution provides for equitable principle "that nobody can be prosecuted and punished for the same offence twice or more times".

B.However wheredifferent reliefs are to be sought from RERA Authority and Consumer Forum, differentcomplaint in both the institutions is maintainable. However onlytwo remedies which RERA can provide, apart from slightly more expeditious disposal of caseswhich the consumer forums are not competent are:-

i.Power to issue directions for completion of project in consultation with State Government by appointment of suitable agency;
ii.Power to include Builder/Developer in the list of defaulter and/or to prohibit it from undertaking new projects.

C.HoweverSection 71(1) read with 72(2) of RERA makes it abundantly clearthat thebar is only in respect of remediesthat can be commonly obtained underboth the Authorities. Hence one it always at liberty to approach RERA or Consumer Forum for remedies not availed from before in other Forum.

D.Also proviso to Section 17(2) of RERA provides for handing over possession within 30 days of obtaining occupancy certificate and execution of conveyance within 3 months of obtaining occupancy certificate. However it does not provide for deemed conveyance unlike Maharashtra Ownership of Flats Act, 1963. InRERA provisions of Section 17 read with Section 34 and Section 38 in my view, one cannot seek reliefas to directions to be issued to Developer/Builder for complying with conditions forgranting Occupation Certificateand obtaining grant of the same. Even in case of failure of Developer/Builder to hand over possession or grant conveyance,the RERA can only impose monetary penaltyand relief in the nature of monetary interest. This is in my view due to the fact also that RERA is an "Authority" formed for limited purpose. A statute cannot be interpreted so liberally so confer power on an authority which the Act does not explicitly provide.RERA in my view is administrative authority, having regard to the scheme of the Act, though it may perform quasi-judicial or quasi legislative functions incidentally. However most decisions of RERA are administrative decisions for enabling it to carrying out its functions as administrative authority under the Act.

E.HoweverConsumer Forums have the powerto grant reliefs in the nature of directions tothe Developer to provide Occupation Certificate, handover possession and grant Conveyancein favour of ultimate entity formed of flat/apartment purchasers. SinceSection 14(1)(e) of CPAprovides for power of Consumer Forum to issue directions "to remove the effects or deficiencies in the services in question, the word"removal of deficiency in service" would also include power to grant reliefs as aforesaid as stated previously, since construction is also "Service" within the meaning of CPA.

F.However since Home Buyer/Flat Purchaser are deemed to Financial Creditors under IBC, they can file an Insolvency Application under section 7 of IBC. However aninteresting question would arise as to when would there be "Default"on the part of Developer. One has to always keep in mind that construction activity or Real Estate Projects are complex in nature, hencea holistic and equitable view of the transactionhas to be taken. A number of transactions and agreements are entered intobetween Developer, Flat Purchaser, Owner and/or Planning Authorities. Every delay in possession than delivery date or non-observance of agreement or statutory possession cannot be construed harshly against the Developer. On admission of Insolvency Application, in case against Developer being a Company,moratorium would come into force for a period of 6 monthswhich would leadto stay of all proceedingsbefore every court. However same doesnot apply to criminal proceedings and writ proceedingsas held by Hon'ble NCLAT in case ofCanara Bank vs Deccan Chronicles Holdings Limited.

G.A company or corporate entity would sought to be revived in case eligible person submits a Resolution Plan and the same is approved by requisite majority of Creditors in the Committee of Creditors. On failure of the same the Company would go in liquidation. Hence after company goes under liquidation, the assets/liabilities would be liquidated in the manner provided in IBC. Flat Purchasers would have priority in discharge of its debts over other creditors and would also have a charge on the property/flat allotted to them at whatever stage of construction it might be under. In case of builder/developer being Individual or partnership firm, then same would straight away go in liquidation.

H.However, if builder is complying with provisions of RERA as to separate bank account opened for money received with respect to flat under construction, and has been unable to complete construction due to financial paucity or any other reason, he will be financial creditor only with respect to interest on amount paid from date of default till completing project or till RERA taking action to complete the project if flat purchaser does not choose to terminate the agreement.

I.However if flat purchaser chooses toterminate the agreement, then he becomesFinancial Creditorto the extent ofpayments made to Developer plus interest duefrom the date of default. DATE OF DEFAULTin my view would be of critical importance and it should be date on which there has beenfailure on part of builder to provide possession as per the agreement or date for completion of projectdisclosed to RERA,whichever is earlier. Default can also meanvalid termination of agreementas per clauses of the binding agreement or under the provisions of any Act andDATE OF DEFAULT would mean the date from which termination is effective.

J.Insolvencywould beoptional remedy, which would be onlyfeasible if company does not have sound financial positionand the same is deteriorating. As to the Applicant would have better prospects at recovering his money along with interest. It will befruitful remedy when the Applicant only seeks to recover money investedalong with interest predominantly.

K.If the Developer has sound financial positionand flat purchaser seeks to obtain specific performanceas to completion of the project,then filing an Insolvency Application may not be feasible option.

L.If flat purchaser is Consumer, Consumer Forum would bea great alternative remedy to obtain specific performance. However if flat purchaser is not competent to obtain relief under CPA, then Civil Courts are the only remedy he has for specific performance and compensation etc.

M.Also RERA is more effective remedy when the project is purely development project or there are large numbers of sale flats which have been sold. This is because in a pure Redevelopment Project, there are less number of tenements available for Developer to be sold and hence less moneys raised and kept in a separate escrow account to be utilized for the purpose of completion of project. Also if more number of charges or mortgages are created on the sale component , then the matter would be only more complex as banks/FI would also put forth their claim on the moneys in the Escrow Account.

Conclusion Of Above Observations And Analysis:-
a.If person is aconsumer and seeks performance of statutory obligationor compensation in respect thereof, thenConsumer Forum is a better and effectiveremedy especially in case where Developer has financial ability to pay. Also he may file a complaint with RERA to blacklist Developer and other reliefs which RERA can provide but consumer forum cannot.

b.If a person is not a consumer,then RERA would be more appropriate remedy.

c.If a person is not a consumer and seeks specific performance of statutory obligations from Developer, his only remedy would be to file a regular suit. However, for compensation and other reliefs he may approach RERA.

d.If Person, whether consumer or not, is seeking only return of his money, especially whenDevelopers financial position is deteriorating, then Insolvency Applicationbefore NCLT would be appropriate remedy more so when its redevelopment of property that doesnot involve many flat in sale component.

e.Also themore the project is closer to the verge of completion, RERA would be a more effective remedy especially if Flat Purchaser/Home Buyer desires to obtain a Flat and vice-versa coupled with the consideration that RERA can also provide compensatory reliefs.

f.Insolvency can always be availed as an alternative remedy when a Flat Purchaser feels that financial position of Developer is deteriorating and Developer will not be able to complete the project and return the money with interest to be able to prevent further deterioration. It will help toobtain recovery of maximum amount of money invested along with Interest.Completion of project may take several years due to various practical difficulties that may arise in the completion of project. Alsoexecution of order for payment of moneywill not have any fruitful result if Developer does not have financial ability to pay it.

g.In terms of execution, Insolvency since being process to liquidate the assets of entity or person willbe a more lucrative remedy in case there is high probability that Developer may not be in position to return the money invested.Consumer Forumsince having power to enforce their own orders also providegreat remedy in case where builder has completed construction but delayed possession or not complied with statutory obligationto obtain reliefs in respect of both.

h.The Flat Purchaser/Home Buyer can always initiate criminal proceedings against Developer against fraud or other criminal offences or acts committed by it.