Supreme Court seeks Additional Solicitor General's assistance in plea seeking model "builder-buyer" agreement to protect buyers

  • Gautam Mishra
  • 05:13 PM, 08 Nov 2021

The Supreme Court on Monday asked Additional Solicitor General KM Nataraj to assist the Court in the plea seeking direction to the Central Government, to frame a 'Model Builder Buyer Agreement' and 'Model Agent Buyer Agreement'.  

A division bench of Justice DY Chandrachud and Justice AS Bopanna said, "It is an important matter, it is not adversarial at all, Mr. Nataraj please assist us."

The Court has listed the matter after 2 weeks while directing the petitioner to serve a copy of the petition to ASG Nataraj.

Earlier, The Court had issued notice in a plea seeking direction to the Central Government to frame a 'Model Builder Buyer Agreement' and 'Model Agent Buyer Agreement to infuse transparency, ensure fair-play reduce frauds in the spirit of objects of the RERA Act 2016 and Constitution of India.

The Court had said, "this is a very important issue of consumer protection otherwise builders can put up anything."

Background: 

The Petitions filed by Advocate Ashwini Upadhyay and Jim Thomson said that the directions are required to ensure accountability and develop a mechanism to weed out the criminal conspiracy for wrongful gain, criminal breach of trust and dishonest misappropriation of buyers money committed by promoters, builders and agents.

Senior Advocate Vikas Singh appearing for the petitioner submitted that there should be a model, however, if it is left for the States then it'll become optional.

Senior Advocate Menaka Guruswamy appearing for the petitioner in another similar matter pressing upon the uniform buyer's agreement submitted that the Central Government may notify the states to formulate.

Justice Chandrachud while issuing notice in both the petitions stated that, "Purchasers are left on the mercy of the developers in the terms of the agreement."

The plea has alleged that the injury caused to the public is extremely large because builders, promoters, and agents use arbitrary and one-sided agreement that does not place customers on an equal platform with them.

The plea has further sought directions from the court to provide compensation to the buyers who suffer losses due to inordinate delays on the part of promoters, builders, and agents.

The plea states that "There have been many cases of deliberate inordinate delay in handing over possession. Buyers lodge complaints but the police doesn't register FIRs, citing arbitrary clauses of the agreement."

The petitioner has made a party to Central Government and Governments of all the States and Union Territories along with the Law Commission stating that as none of the States till date has notified and enforced RERA Act and framed 'Model Builder Buyers Agreement' and 'Model Agent Buyer Agreement' ensuring transparency and fair-play.

Case Title: Ashwini Kumar Upadhyay Vs. Union of India & Ors. AND Jim Thomson and Ors. Vs. Union of India and Ors.