Legality of MahaRERA Conciliation Forum Affirmed

23 Sep 2024 CW Team

The chairman of Mumbai Grahak Panchayat (MGP), Shirish V Deshpande, has affirmed that the conciliation forum established by the Maharashtra Real Estate Regulatory Authority (MahaRERA) operates within legal boundaries. This statement comes as the Forum for Peoples' Collective Efforts (FPCE), a national association of homebuyers, questions the forum's legitimacy and seeks intervention from the Ministry of Housing and Urban Affairs.

Deshpande explained that the conciliation forum is rooted in Section 32(g) of the Real Estate (Regulation and Development) Act, 2016 (RERA), which mandates state RERA authorities to recommend measures for amicable dispute resolution between promoters and allottees. The forum was initiated following discussions with promoters’ associations and was officially notified on January 29, 2018.

In August, FPCE President Abhay Upadhyay expressed concerns in a letter to the Ministry, claiming that MahaRERA lacks the legal authority to establish such a forum, raising fears of a potential conflict of interest. However, Deshpande contended that the forum is functioning effectively within RERA's framework, encouraging those with legal concerns to challenge its validity in court.

He clarified that while MahaRERA provides administrative support, its members do not participate in the conciliation process. The conciliation bench consists of two conciliators: one from MGP and another from recognized industry bodies.

The benefits of conciliation include quicker resolutions—typically within 3-4 sessions—saving both time and money. Since the settlements are mutually agreed upon, they avoid the need for appeals. Additionally, RERA imposes penalties for non-compliance, which can accumulate to 5% of the total project cost.

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