New Delhi, August 27, 2017: Construction contracts, unlike other civil contracts, involve intricate and minute details, which makes the execution of such contracts difficult. Mostly construction projects are technically complex and could only be undertaken by specialised contractors for different stages of construction. Therefore, construction contracts require constant involvement of and supervision by well qualified and trained professionals.
Various judicial pronouncements have held that construction contracts, being more technical, cannot be equated with other civil contracts and cannot be specifically enforced since they involve minute details and require an experienced and qualifiedprofessional to supervise the same.
How Rera Could Pose New Challenges
Therefore, post revocation of registration, it appears that RERA ousts the developer and envisages the execution of the remaining construction either by the competent authority or the association of allot tees who may not have the requisite training or experience. It is quite possible that some of the members of the association of allot tees may not necessarily agree firstly with the exercise of carrying out the construction itself and secondly with the manner in which such construction is to be carried out, thereby leading to a possible situation of deadlock. Having regard to the nature of construction contracts, as aforesaid, a complete absence of guidance, under RERA, in executing the balance construction and that too by authorities / associations who may not possess the requisite technical expertise, would only compound the difficulties of the buyers and further delay the handing over of possession. Therefore, it is not clear whether RERA would yield desired results in execution of the balance construction work.
Apart from the above, the following could potentially create more issues:
Therefore it appears that in the absence of a thorough step-by-step procedure for execution of the remaining construction of a real estate project, RERA may create more issues than provide solutions.Also debarring the developer from carrying out the balance construction may not yield the result, which the Act intends to achieve qua the consumer. Therefore, instead of providing for revocation of a developer’s registration, in cases of breach or default, RERA may be amended to incorporate penalties which could deter the developer from breaching the provisions of RERA and the agreements with the buyer. In the alternative, the state rules could introduce a well detailed procedure for the completion of the remaining real estate project and indemnifying the consumer for the loss, if any.
Corporate Comm India(CCI Newswire)
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