By Staff Reporter
In a significant ruling, the Madras High Court has declared that small housing projects consisting of fewer than eight apartments and covering less than 500 square meters are not required to register under the Tamil Nadu Real Estate Regulatory Act (TNRERA). The court’s decision overturns a compensation order imposed by TNRERA on a developer for delays in delivering flats.
The case involved a project by Devinarayan Housing Board and Property Developments, which comprised eight flats in an area of 5,935 square meters. TNRERA had previously directed the developer to pay compensation of Rs 13.31 lakh along with Rs 25,000 in legal expenses for delays in handing over the flats.
The Madras High Court ruled in favor of the developer, stating that the project met one of the criteria for exemption under Section 3(2) (a) of the RERA Act. This section specifies that a project is exempt from TNRERA registration if the land is not developed exceeding 500 sqm ‘or’ the project does not exceed eight apartments, inclusive of all phases.
The court emphasized that the definitions and provisions of an Act cannot be used beyond its scope. Therefore, small housing projects meeting the specified criteria are not required to register under TNRERA. The ruling means that buyers with grievances related to such projects must seek redress through civil or consumer courts rather than TNRERA.
This decision clarifies the jurisdiction of TNRERA and underscores the importance of adhering to the specific criteria outlined in the Real Estate Regulation Act. It also provides developers of smaller projects with a clearer understanding of their regulatory obligations.
As the real estate landscape evolves, such legal interpretations play a crucial role in defining the boundaries of regulatory oversight, ensuring fairness for both developers and homebuyers.