SC quashes Bengal law on real estate
‘Repugnant to Centre’s Real Estate (Regulation and Development) Act that already occupies the field’
New Delhi: In a setback to the Mamata Banerjee-led TMC government in West Bengal, the Supreme Court has struck down a law regulating real estate sector in the state holding it to be unconstitutional and repugnant to Centre’s Real Estate (Regulation and Development) Act.
The Supreme Court on Tuesday struck down West Bengal’s Housing Industry Regulation Act, 2017 (HIRA) for regulating the real estate sector in the state as “unconstitutional”, holding it is repugnant to Centre’s Real Estate (Regulation and Development) Act that already occupies the field regulating the real estate sector inthe country.
A bench of justice D.Y. Chandrachud and Justice M.R. Shah said the West Bengal Housing Industry Regulation Act (WBHIRA), 2017 is more or less identical to the Centre’s RERA and in the teeth of constitutional scheme hence repugnant to Parliament’s law.
Speaking for the bench, Justice Chandrachud said that two fundamental features that emerge from the analysis of the provisions of RERA and WB-HIRA is that “a significant and even overwhelmingly large part of WB-HIRA overlaps with the provisions of RERA. These provisions of the RERA have been lifted bodily, word for word and enacted into the State enactment.”
Second, Justice Chandracud said that in doing so, “WB-HIRA does
◗ not complement the RERA by enacting provisions which may be regarded as in addition to or fortifying the rights, obligations and remedies created by the Central enactment.”
Having noted the identical provisions of HIRA, lifting the provisions of
RERA and the constitutional scheme, Justice Chandrachud said, “we have come to the conclusion that WB-HIRA is repugnant to the RERA, and is hence unconstitutional. We also hold and declare that as a consequence of the declaration by this Court of the invalidity of the provisions of WB-HIRA, there shall be no revival of the provisions of the WB 1993 Act, since it would stand impliedly repealed upon the enactment of the RERA.”
The 1993 West Bengal law for regulating the real estate stood repealed upon the enactment of 2017 Housing Industry Regulation Act.
Noting that since its enforcement, HIRA would have been applied to building projects and implemented by the authorities constituted under the law, the court took recourse to its plenary powers under Article 142 of the constitution in order to avoid “uncertainty and disruption” in respect of actions that has already been taken in the past.
Taking recourse to its powers under Article 142 of the constitution, court directed “The striking down of WB-HIRA will not affect the registrations, sanctions and permissions previously granted under the legislation prior to the date of this judgment.”
The court ruling came in a petition by a homebuyers association, Forum for People’s Collective Efforts, challenging the constitutional validity of the state’s 2017 Act, which is more or less identical to the Centre’s RERA enacted a year earlier in 2016.
The petitioner — Forum for People’s Collective Efforts — had contended that the HIRA has certain provisions which are either directly inconsistent with the corresponding provisions of the Central enactment; or a virtual replica of the RERA.
Speaking for the bench, Justice Chandrachud said that two fundamental features that emerge from the analysis of the provisions of RERA and WBHIRA is that “a significant and even overwhelmingly large part of WB-HIRA overlaps with the provisions of RERA.