New legal avenue against errant builders, schools

SansadTV Bureau
Construction site of a Residential Project. Photo-RSTV

Construction site of a Residential Project.

In a new ray of hope for millions of home buyers who have been suffering inordinate delays in delivery of homes, central government has included housing & real estate and educational services under the jurisdiction of Lok Adalats.

The new legal avenue will also be available for grievances against educational institutions which charge excess fee or deny admission on frivolous grounds or delay the grant of degrees.

If a housing project delays possession but fails to pay interest or an educational institution harasses students and guardians on frivolous ground, people can now approach a lok adalat for faster redressal of their grievances.

Housing sector boom in the last decade has also led to entry of errant and inexperienced builders in the real estate sector. As per the data compiled by real estate consultancy firms, delivery of over 15 lac flats have been delayed by at least 14 to 30 months.

As per the data compiled by consultancy firm PropEquity, over three fourth of around 9,600 projects launched between 2008 to 2010 in Delhi-NCR, Mumbai region, Pune and Bengaluru remain unfinished. Ordinarily, housing projects are expected to be delivered within three years.

The inclusion of real estate and educational institutions under the jurisdiction of Lok Adalats is expected to provide relief to millions of home buyers as a bill for real estate sector is stuck in the Rajya Sabha.

A Law Ministry notification issued on February 16 said the two new categories have been included in Section 22 A of the Legal Services Authorities Act, 1987 “in public interest”.

These two sectors have been included under the definition of ‘public utility services’ based of the feedback received by legal services authorities across the country.

Till recently, ‘public utility service’ under the Act included transport services, postal, telegraph or telephone service, power and water supply service, sanitation, service provided by hospital or dispensary and insurance service.

People could approach lok adalats with grievances related to these utilities.

“This will reduce pendency in regular courts. Issues like eligibility for admission, exorbitant tuition fee, refusal or delay to grant degree, refusal by builder to pay interest for delay in handing over a house can be covered by lok adalats where grievance redressal is faster than regular courts,” explained a senior official of the ministry.

He said certain types of cases related to housing and real estate would still have to be settled in regular courts.

The Legal Services Authority Act was enacted to constitute legal services authorities to provide free legal services to the weaker sections of the society and to organise lok adalats to ensure that the operation of the legal system promotes justice on a basis of equal opportunity.