RERA'S MANDATE VS DDA'S EVASION: UNTANGLING THE LEGAL CONUNDRUM

When two distinct statutory bodies establish authority over the same issue, it creates legal uncertainty and compliance issues for many stakeholders. In a recent turn of events, we have witnessed that the Delhi Development Authority approached the Delhi High Court, challenging the authority of the Delhi RERA over its ongoing projects and developmental work. The current ongoing tussle between the two statutory bodies is nothing new. This conflict resurfaced after RERA received complaints from the residents of DDA's prime real estate project in Dwarka regarding the substandard quality of their luxury flats. It directed the DDA to form a panel to look into the grievances of residents and mandatorily register all its real estate projects with the regulatory body. Notably, this project was also registered after getting reprimanded by the RERA.

The major contention between these two statutory bodies at odds is regarding the jurisdiction of the real estate regulatory authority in the developmental work related to planning, development and construction of Housing Projects, etc. carried out by the Delhi Development Authority under the Delhi Development Act 1957, along with the Nazul Rules and the Delhi Development Authority (Management and Disposal of Housing Estates) Regulations, 1968, which define the framework for its housing activities.

Through this article, the authors will examine the conundrum around overlapping legislative frameworks and argue for the exclusive regulatory jurisdiction of RERA in matters pertaining to real estate. Finally, the authors will suggest a harmonious approach to resolve the current jurisdictional dilemma.

I. UNRAVELING THE DELHI DEVELOPMENT AUTHORITY'S CLAIM

DDA, established under the Delhi Development Act 1957, is an autonomous body that reports directly to the Ministry of Urban Development, Government of India. Unlike most states in India, it is outside the purview of the state government. Section 6 of this act outlines the object of DDA, "to promote and secure the development of Delhi." The DDA is responsible for planning, development, and construction of Housing Projects, Commercial Lands, Land Management, Land Disposal, Land Pooling, Land Costing, etc.

In the present dispute, a crucial contention raised by DDA is constant regulatory overreach by DRERA through repeated notices, orders, and directions, which hindered the smooth and efficient functioning of DDA. In pursuant to this allegation, other significant issues raised by DDA in its petition to the Delhi High Court are, firstly, that its operations are governed by DDA 1957, along with the Nazul Rules and the Delhi Development Authority (Management and Disposal of Housing Estates) Regulations, 1968, and its functioning is under the direct administrative control of the central government with a broad constitutional and parliamentary mandate already subject to stringent government oversight, audits, and accountability frameworks terming additional regulatory oversight by DRERA as palpably unconstitutional, illegal, unauthorized and as an "overreach of jurisdiction.

Secondly, DDA challenged the mandatory registration requirement of real estate projects by promoters failing, which might attract a penalty under Section 59 of RERA with a fine extending up to ten percent of the estimated cost of the project. DDA contends that it is fundamentally different from private or commercial developers as it is not a profit-driven commercial entity. It functions as an instrument of state policy to provide affordable housing and residential facilities to the public at large, so it must be exempted from obligatory registration requirements like those of private builders.

Thirdly, while calling into question section 4 (2) of RERA, flagging compliance issues, DDA claimed their nature to be immaterial and inapplicable to them. This provision makes it obligatory for promoters to furnish certain information with the application for registration, including details of projects launched in the past 5 years, their current status, copy of approval, commencement certificate from a competent authority, sanctioned plan, layout plan, and specifications of the proposed project, details about phased implementation, etc. to be published on RERA website. DDA claimed that its foundational identity and functions are already established by law, rendering such requirements redundant, and it should not be obligated to furnish such information in the same format as private promoters, as DDA in itself is a "competent authority" sanctioning and regulating its projects, layouts, and development plans.

II. RERA'S PREVAILING JURISDICTION IN THE PRESENT MATTER: AN APPRAISAL THROUGH LEGISLATIVE TEXTS AND JUDICIAL DECISIONS

In countering the claims of DDA, we need to meticulously look at both legislations and find if the currently raised contentions hold any ground or if they are just futile attempts to bypass the scrutiny of the regulatory authority.

The legislature empowers RERA under Section 3 to compel the promoters to register real estate-related projects mandatorily and to furnish all information regarding the same under Section 4(2); DDA's claim that being a statutory public body, unlike private or commercial builders, it should be exempted of such requirements, but under RERA 2016, Section 2(zk)(iii) states that any development authority or any other public body will be treated as a promoter, this makes RERA's mandate clear also to include relevant government bodies under its regulatory framework including DDA, thereby negating their claim.

Now, another claim that they are a "competent authority" in itself for sanctioning and regulating their projects under the definition of RERA is valid to an extent because the approvals like a sanctioned plan, layout plan, building plan, etc., are approved by DDA only, but this does not make it a fully competent authority because necessary approvals like Environment Impact Assessment clearance, consent and NOC of the State Pollution Control Board (SPCB) under the Water (Prevention and Control of Pollution) Act, 1974 and Air (Prevention and Control of Pollution) Act, 1981, NOC from Airport Authority of India etc.. are given by departments functioning independent of DDA. The Supreme Court has recently reaffirmed its earlier decisions in Common Cause v. Union of India and Alembic Pharmaceuticals v. Rohit Prajapati, which made it clear that the principle of prior EC is a non-negotiable approval.

While administering its functions, RERA can obligate the promoter to register their project and furnish information regarding the project. Such approvals from relevant authorities will be published online for homebuyers to view on the website. To facilitate systematic record-keeping, which is instrumental in tracking the progress of the project, identifying potential issues, and facilitating informed decision-making by enhancing transparency and holding promoters accountable for their actions and commitments, thus deterring fraudulent practices and fostering trust among stakeholders, particularly homebuyers. Therefore, when any regulatory agency authorized by the central government requests such information, DDA, through its own Act of 1957 under section 42, is bound by law to supply it.

DDA, time and again, has been proven guilty of willful disobedience and blatant disregard for the compliance requirement under the central government's environmental laws and regulatory mechanisms due to not following the established procedure. Section 53(3) of the DD Act empowers the planning body to carry out developmental activities approved by the DDA even if permission under other laws is not obtained; DDA has interpreted this provision broadly to bypass the statutory mandate of RERA and State Pollution Control Boards. We need to analyze this ambiguity of the non-obstante clause in the DD Act with a similar provision in RERA with a Purposive Interpretation of both statutes, which provide that the DD Act was created by parliament to promote and secure the development of Delhi in a planned manner. Meanwhile, RERA's objective is to ensure greater accountability from promoters, protect consumers, reduce fraud and delays, and bring transparency and a fast-track dispute resolution mechanism.

This indicates that DD Act section 53(3) has an overriding effect on parallel legislation governing that subject matter, which is planning and development, not on a regulatory regime like RERA, whose primary function is real estate governance and regulation. Hence, DDA's blatant and deliberate disregard of DRERA notice and directives warrants punishment and penalty under its provisions.

III. BRIDGING THE DIVIDE: TOWARD COOPERATIVE REGULATION AND THE ROAD AHEAD

Delhi HC's formal notice to both the Delhi RERA and the Ministry of Housing and Urban Affairs, seeking their official response to DDA's claims, is expected to shed more light on the extent of regulatory control RERA can exercise over government bodies like the DDA. One plausible solution involves seeking advice and recommendations from the Central Advisory Council under Section 42, with all relevant stakeholders, who provide more clarity on the scope of RERA's applicability and remove regulatory ambiguities. This clear delineation of responsibilities can streamline regulatory processes and foster more effective oversight.

Many developmental projects by planning bodies face additional layers of complexity and delays due to constant oversight by such regulatory bodies through orders, notices, etc.. Such delay may affect project timelines and drive up operational costs, which could hinder development activities, jeopardizing projects and cause economic losses across the real estate industry thus an Online Single Window Clearance System integrated with RERA's database with real-time update and auto verification of approvals will ensure inter-departmental coordination and regulatory efficiency without compromising on compliance requirements.

IV. CONCLUSION

It is unequivocal that the RERA's jurisdiction remains predominantly exclusive regarding disputes falling within its ambit. Statutory rights and remedies created under special laws like RERA cannot be diluted or circumvented because this transformative legislation seeks to address vital issues of fair transactions, timely delivery, and quality construction through speedy adjudication of disputes, thus empowering the home buyers. The standoff between two statutory bodies poses a serious challenge of fragmented governance with regulatory ambiguity without clear boundaries.

Judicial pronouncements in various instances while deciphering non obstante clauses of RERA have propounded a strategic approach to harmonize this special statute with other existing laws and ensuring it functions in a complementary manner rather than conflicting, so establishing a clear regulatory and institutional framework through legislative clarifications, cooperative mechanism, and judicial interpretation can foster regulatory certainty, reducing compliance burden, delays, and investment risk.