The Bombay High Court has raised an important question to the Maharashtra government regarding the ability of the state's housing regulator, the Maharashtra Real Estate Regulatory Authority (MahaRERA), to identify, classify, and rate private developers. The purpose of this is to provide societies and other relevant parties with the information they need to make informed decisions when choosing a builder.
The Bombay High Court has raised an important question to the Maharashtra government regarding the ability of the state's housing regulator, the Maharashtra Real Estate Regulatory Authority (MahaRERA), to identify, classify, and rate private developers. The purpose of this is to provide societies and other relevant parties with the information they need to make informed decisions when choosing a builder.
The Bombay High Court has highlighted the importance of having a reliable system for classifying and rating private developers to minimize the risks involved in the redevelopment process and ensure that societies and other relevant parties make informed decisions. This case serves as a reminder of the need for clear and effective regulations in the real estate industry to protect the interests of all parties involved.
A division bench of Justices Gautam Patel and Neela Gokhale was hearing a petition taken up suo motu by the HC, based on a plea filed by an individual seeking payment of unpaid transit rent and a solution to the stalled redevelopment of the cessed property 'Ratilal Mansion' in south Mumbai. The redevelopment of the building was discontinued in 2013 after the private developer Orbit Corporation Limited, which was involved in the project, went into liquidation. By that time, the developer had completed construction of nine floors of the new building.
The Maharashtra Housing and Area Development Authority (MHADA) informed the HC that it was in the process of appointing a structural consultant to complete an audit report of the semi-finished structure. Additionally, MHADA now has the power to redevelop a building on its own. However, the court recognizes that the dilemma faced by both MHADA, and the society is not just about structural auditing and engineering, but also about making the right choice when selecting a developer.
The court asked the Maharashtra government if an authority such as MahaRERA can identify, classify, or rate developers according to any measure it deems appropriate. This would help minimize the risk involved in project completion and allow societies and MHADA to make better and informed decisions about the choice of developer. The court also asked MahaRERA if it has a database of developers and if it has a rating system, and if not, if it is willing to consider creating one. The court acknowledged that MahaRERA is not only a statutory authority, but also has specialized knowledge, expertise, and data, and requested its assistance in this matter.
The court took suo motu cognisance of the issue after recognizing that this problem occurs repeatedly throughout the city, especially with the redevelopment of cessed buildings. The law currently does not have an effective provision for situations where a developer cannot complete construction, leaving members without homes and with unpaid transit rent. The building in question was demolished in 2009 and was intended to be redeveloped but has now been attached by the Brihanmumbai Municipal Corporation over unpaid property tax. The court has scheduled the next hearing for March 3.
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