Event Report- MahaRERA Conciliation: A successful method of fast track dispute resolution for consumer and builder

The Maharashtra Real Estate Regulatory Authority (MahaRERA) has seen a rise in complaints from homebuyers and had thus come up with a Conciliation Forum, where aggrieved homebuyers could get their grievances solved within 45 days, says AV Shenoy, . He was speaking at a special seminar on How Home Buyers can use Conciliation under RERA for Rapid Dispute Resolution organised by Moneylife Foundation in Mumbai.

The MahaRERA had set up about 15 conciliation benches comprising one member each from the developer s associations and consumer oganisation to help resolve disputes between developers and homebuyers through dialogue and conciliation process. The Conciliation Benches had come into effect from 1st February and its first hearing taking place on 10 March 2018. This forum acts as a mediator between two parties and as an alternative dispute resolution mechanism. Although it is only available at Mumbai and Pune at the moment, Maharashtra is the first state to implement such a conciliation forum for dispute resolution.

Most homebuyers complain that they do not get to meet or communicate with the developer or that they write letters, but receive no response from the developer. In the Conciliation, they get a chance to speak directly with the developer or the authorised representative with conciliators acting as mediators in the dispute.

Mr Shenoy, who is panel member on the Conciliation Bench in Mumbai, explained in detail the process of approaching the forum for resolution. He insisted that the forum will only take complaints between developers and homebuyers, which are under the purview of RERA Act 2016. A homebuyer will first have to log on to MahaRERA website and register on the Conciliation Forum to file an online application with the forum. After a request for conciliation has been filed, the other party will be intimated about the same through email, and on receiving an acknowledgement they will get a payment option. The buyer will have to pay Rs1,000, which is cheaper than the Rs5,000 to be paid to MahaRERA for adjudication.

After the payment is received, a bench will be allocated to redress the issue and begin its hearing at a location decided by MahaRERA. Both parties have to come or depute their representatives for the hearing. Mr Shenoy clarified that lawyers were not allowed at a conciliation forum as the meeting is conducted only between the complainant and the developer.

The members of the forum - one from the builders association and other from MGM - will try to resolve the dispute after hearing both parties. Normally there are three hearings conducted in a 45 days after which a judgement is made. If the case is solved during conciliation, the Bench will ask both parties to sign a conciliation agreement, which will act as the closure of the complaint. If both parties fail to reach a settlement, the conciliation process would stand canceled and the parties can approach MahaRERA for adjudication.

After the seminar, Mr Shenoy was also available to clarify some queries raised by concerned home buyers. When asked whether the complainant had a choice on the location of the conciliation hearing, Mr Shenoy said, at present, it is decided by MahaRERA and Bench members have no control over the location .

When asked whether a complaint can only be made when you have a registered agreement or could it also be filed based on a letter of allotment, it was Mr Shenoy s impression that not having registered agreement was reason enough to approach MahaRERA for adjudication.

In a serious case where the developer has not given possession of a flat for 8 years after an agreement was registered in 2011, it was Mr Shenoy s opinion that an adjudication case should be filed in RERA. He believes in such a case, the buyer has to decide whether he/she should remain in the deal and ask for compensation on the delay or leave the deal and demand a refund with interest on the delayed months. In cases where an agreement is not reached through adjudication in MahaRERA, the case can be taken up at an appellate tribunal or even further at the High Court.

A buyer at the seminar had asked whether a conciliation request could be made after already having taken possession. Mr Shenoy was clear that it was unwise to do so as possession indicates that the buyer is satisfied with the terms in the registered agreement. If the developer was forcibly asking the buyer to take possession especially without Occupancy Certificate (OC), Mr Shenoy suggested to register a complaint under RERA for resolution.

Another topic of discussion was the blatant marketing tactics of developers to offer a gold coins, cars or other such luxury items as gifts on the purchase of their flat. A buyer at the seminar had asked whether there was any provision to debar such ads in RERA. Although, Mr Shenoy was unaware of any such provision, he did agree that such ads were just plain marketing gimmicks that the consumer should be wise about . The buyer should take into consideration the construction quality or perhaps worry about why the developer was offering such an incentive before blindly jumping into a deal.

Overall, Mr Shenoy is confident that conciliation is a very successful method of resolving disputes between buyers and developers. Since the first hearing in March, there have been 264 requests received, of which 135 have received consent from developers. There have been 69 cases concluded amicably through conciliation and 31 cases are still under hearing. The forum has a high success rate of 79%, which Mr Shenoy believes is a sign that conciliation needs to be accepted as a method of dispute resolution in cities other than Mumbai and Pune as well.

Date: 19 Jul 2018
Time: 5:00pm to 7:00pm
Venue: Moneylife Foundation Knowledge Centre, 304, 3rd Floor, Hind Service Industries Premises, Off. Veer Savarkar Marg, Near Shivaji Park Seaface, Dadar (W), Mumbai - 400028.

You can watch Moneylife TV on YouTube of previous events