It is ‘essential’ to enforce apartment acts
Compat order a ‘wake-up call’ for builders, say experts; Haryana Apartment Ownership Act, 1983, should incorporate certain features of the UP Apartment Act 2010
The Competition Appellate Tribunal (Compat) recently upheld a ` 630 crore fine on realty giant DLF imposed by the Competition Commission of India ( CCI) in 2011 on a complaint that it had imposed arbitrary and unfair conditions on buyers who had booked apartments in Belaire, Park Place and Magnolia projects in Gurgaon. This is a ‘wake-up call’ for developers who have violated laws and misrepresented facts to buyers.
Realty experts say that the order will send a strong signal to builders, forcing them to adhere to the rule book. Vaibhav Gaggar, partner at law firm Gaggar & Associates, says that the Compat order should serve as a warning for builders as they can now be penalised for malpractices. They will now have to be careful before taking a chance by violating laws and misrepresenting facts to buyers.
Despite laws being in place, lack of implementation and awareness creates problems. As authorities are turning a blind eye to the legal processes these are not getting enforced. Consumers need to become more vigilant, he says.
Welcoming the approval of guidelines for implementation of the UP Apartment Act 2010 recently, Gaggar adds that going forward the Haryana Apartment Ownership Act, 1983, should also incorporate certain features of the UP Apartment Act 2010.
It is for the first time that the UP Apartment Act 2010 has categorically stated that once fixed, rates of apartments cannot be changed. The Haryana Apartment Ownership Act, 1983, has no such provision.
Under the UP Act, sanctioned plans and approvals have to be in place before the launch, a categorical provision that the Haryana Act does not have.
Provisions which Haryana could borrow from the UP Act include imprisonment in case of certain violations by promoters; and imposition of monetary penalty on apartment owners if maintenance is not paid on time or any amount due to them is not paid.
The 2011 ruling by the CCI had held DLF guilty of violating Section 4 of the Competition Act, 2002 after the Belaire Owners’ Association approached it alleging “abuse by a dominant enterprise”.