Redressal Mechanism under the Real Estate (Regulation and Development) Act 2016: Ouster of the Arbitration Tribunal?
Volume 10 Issue 1 (2017)
The Parliament enacted the Real Estate (Regulation and Development) Act, 2016 to regulate the real estate sector, protect innocent buyers and provide speedy redressal mechanism. This Act fills a large lacuna as real estate was hitherto unregulated. This Act seeks to provide respite to frustrated and helpless buyers who have so far been at the mercy of unscrupulous builders and years of litigation. Apart from protecting the buyers, this Act establishes a specialised body for its enforcement and also creates a dedicated forum for seeking compensation, which was earlier being awarded by consumer forums. Looking closely at the provisions of this Act and the procedure for filing of complaints, the creation of two separate forums for enforcement and compensation establishes an absurd position of law leading to multiplicity of complaints for the same cause of action, an unnecessary determination of jurisdiction and the possibility of conflicting views. Further, in the presence of specialised statutory forums for adjudication of disputes, the question of validity of arbitration clauses in real estate agreements and the arbitrability of disputes under this Act becomes a moot point. Given the lack of clarity over the arbitrability of such disputes, and in furtherance of the objectives of this Act, this paper argues in favour of ouster of the jurisdiction of arbitration tribunals for an effective enforcement and speedy redressal of disputes in the real estate sector.