Govt. has not acted on selection committee recommendations for authority chief, members

For multiple reasons, Kerala is perhaps the only State which is yet to form a Real Estate Regulatory Authority (RERA).

At present, the State relies on a namesake one - member authority, a secretary, who is an ex-officio member, since the real estate section functions under the Local Self Government Department.

Legally inappropriate

But this is legally inappropriate as the Real Estate (Regulation and Development) Act (RERA), which came into force in 2016, mandates that all States form an adjudicating body for regulation of the real estate sector to protect homebuyers. It also envisages a speedy dispute redressal system.

Each State, official sources said, should have an authority with a chairman and two members appointed by the government through a selection committee headed by the Chief Justice of the High Court or his nominee.

In Kerala

Significantly, in March 2019, a selection committee chaired by Justice P.R. Ramachandra Menon invited applications for the post of chairman and two members of the authority in Kerala.

As warranted, this panel also conducted an interview and submitted two names for the post of chairman and four names for the post of two members in April. The government is yet to act on the panel decision though this has to be done within a month.

Fresh list

Sources said the State government was dissatisfied with the selection of the panel for unknown political reasons. Now it wanted to request newly appointed Chief Justice S. Mani Kumar, when he possibly takes charge after the Puja holidays, to submit a fresh list.

Meanwhile, the government also faces the ignominy of a possible contempt of court following the verdict of a three-judge Bench headed by Justice R.F.Nairman of the Supreme Court that stated that RERA should to be read harmoniously with the Insolvency and Bankruptcy Code (IBC).

The apex court had also ordered recalcitrant States to appoint a real estate regulatory authority and an appellate tribunal and file compliance affidavits within three months. The deadline is first week of November.

First Act in 2015

For more than a decade, the absence of strong laws for the thriving real estate industry was a concern in the State. However, it was the UDF government that passed an ordinance – Kerala Real Estate Regulation Act – in 2015.

Subsequently, a Bill was piloted in the Assembly and it became a law. Then, though not comprehensive, only one State - Maharashtra had a law - Housing (Regulation and Development Act) for the real estate sector.

Thus a Real Estate Regulatory Authority and a Real Estate Appellate Tribunal were formed in Kerala. But it was short-lived when the present CPI(M)- led Left Democratic Front government dissolved them after some confusion whether to adopt the Central Act or stick to its own legislation.

Soon the government promulgated the Kerala Real Estate (Regulation and Development) Act repeal ordinance in 2017. Consequently, it was also passed in the Assembly session.

Piquant situation

Now, the State finds itself in a piquant situation with no laws. Kerala would have got a regulatory mechanism had the State government remained firm on its already legislated Kerala Real Estate (Regulation and Development) Act.