The Maharashtra Real Estate Appellate Tribunal (MREAT) has reinforced statutory protections for homebuyers, overturning a prior order from the Maharashtra Real Estate Regulatory Authority (MahaRERA) that had directed buyers to resolve disputes through arbitration. The appellate ruling sends a strong signal that contractual clauses cannot undermine regulatory remedies designed to safeguard residential purchasers, ensuring adherence to timelines, compensation rights, and statutory oversight in real estate projects.
The case emerged from the “Rivali Park” development in Borivali, involving the Winter Green residential towers, where buyers including local residents had booked flats and paid significant consideration. Disputes arose when the promoters failed to deliver possession within agreed deadlines. Buyers had approached MahaRERA seeking interest and compensation for delayed handovers, a statutory right under the Real Estate (Regulation and Development) Act, 2016 (RERA). MahaRERA initially dismissed the complaints in 2022, citing Clause 59 in pre-RERA sale agreements that mandated arbitration as the forum for dispute resolution. By doing so, the authority effectively deferred the buyers’ complaints without examining substantive issues. Homebuyers challenged this, asserting that statutory rights under RERA cannot be waived through private contracts, particularly where the agreements predated the Act. The Appellate Tribunal relied on judicial precedents, including the Bombay High Court’s judgment in M/s Rashmi Realty Builders Pvt. Ltd. vs. Mr. Rahul Rajendrakumar Pagariya and the Supreme Court ruling in M/s Newtech Promoters and Developers Pvt. Ltd., which emphasised that RERA’s provisions apply retroactively and that disputes under the Act are non-arbitrable.
The tribunal noted that statutory remedies under a welfare-focused law such as RERA cannot be curtailed by contractual clauses, even if arbitration was mutually agreed upon before the legislation came into force. By remanding the matter back to MahaRERA, the tribunal directed the authority to examine complaints afresh on their merits. The decision ensures that buyers have access to regulatory dispute resolution without being compelled to resort to arbitration, preserving the Act’s intent to provide timely, enforceable redress in delayed possession or compensation matters. Industry analysts suggest that this ruling could have wider implications for pre-RERA projects across Maharashtra, clarifying that regulatory mechanisms take precedence over contractual arbitration clauses. Urban planners and housing sector experts see this as reinforcing accountability among developers, ensuring project timelines and statutory compliance are treated as non-negotiable obligations.
The tribunal’s judgment highlights the broader principle that statutory protections in India’s real estate framework are designed to safeguard citizens and urban residents, reinforcing regulatory authority over contractual technicalities. It underscores the need for developers to align project management, handover schedules, and dispute-resolution mechanisms with both legal mandates and ethical responsibility to homebuyers.
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