RERA Rules for Termination of Contract – What You Need to Know
The Real Estate (Regulation and Development) Act, 2016 (RERA) has brought about significant changes and introduced new rules and regulations in the Indian real estate industry. One of the most important rules introduced by RERA is related to the termination of contracts. In this article, we will take a closer look at the RERA rules for termination of contracts and what you need to know as a homebuyer, builder, or developer.
What is RERA?
RERA is an Indian law that was introduced in 2016 with the aim of regulating the real estate sector in the country. The law lays down rules and regulations for the sale, purchase, and development of real estate properties. The law also establishes a regulatory authority in each state to oversee the implementation of the law.
What are the RERA rules for termination of contracts?
Under RERA, both the homebuyer and the builder have the right to terminate the contract in certain circumstances. The following are the circumstances under which a contract can be terminated:
1. Delay in possession: If the builder fails to hand over possession of the property within the agreed-upon time, the homebuyer has the right to terminate the contract. The builder is required to refund the entire amount paid by the homebuyer along with interest.
2. Defects in the property: If the property is found to have defects or is not as per the agreed-upon specifications, the homebuyer has the right to terminate the contract. The builder is required to refund the entire amount paid by the homebuyer along with interest.
3. Misrepresentation by the builder: If the builder has made false claims or misrepresented the property, the homebuyer has the right to terminate the contract. The builder is required to refund the entire amount paid by the homebuyer along with interest.
4. Breach of contract by either party: If either the homebuyer or the builder breaches the terms of the contract, the other party has the right to terminate the contract. In such cases, the party who has suffered the breach may claim compensation.
What is the procedure for terminating a contract under RERA?
If you want to terminate a contract under RERA, you must follow the procedure laid down by the law. The following are the steps that you need to take:
1. Send a notice: You must send a notice to the other party stating your intention to terminate the contract and the reason for termination. The notice must be sent by registered post with acknowledgment due or by electronic means.
2. Wait for a response: The other party has 15 days to respond to your notice. If they do not respond within 15 days or refuse to refund your money, you can file a complaint with the regulatory authority.
3. File a complaint: You must file a complaint with the regulatory authority within one year of the cause of action. The regulatory authority will then investigate the matter and pass an order.
In conclusion, the RERA rules for termination of contracts provide a level of protection to both homebuyers and builders. It is important to understand these rules and follow the procedure laid down by the law if you wish to terminate a contract. If you have any doubts or queries regarding the termination of contracts under RERA, you should consult a legal expert.