Dear Consumers, You Will Soon Have Another Law To Protect You
It should not surprise many of you when we say a consumer is still figuring out the benefits that he will be able to enjoy after the arrival of key legislations such as the Real Estate Act and the Goods and Services Tax.
In the words of Prime Minister Narendra Modi, the real estate law would “protect buyers from builders' monopoly”. “A buyer can book a flat with 10 per cent booking amount from the earlier up to 40 per cent, thanks to the real estate law. “The developer will not be able to divert fund as 70 per cent of the money has to be kept in an escrow account,” the PM said on October 26. He also said that the GST would benefit consumers in the long run as prices would come down because of competition among manufacturers.
"In the long term, GST will benefit only consumer. Consumers will not be cheated as they become more aware of this law," he said, adding that consumers can now see on receipts the tax they are paying to the Centre and states.
In the short term, however, confusions runs wild as authorities across the country prepare themselves to provide you protections guaranteed under these laws. Once the initial confusion settles, we hope to be better protected as consumers.
In the meantime, the government is in process of amending an earlier law to provide better protection to consumers.
What is new?
The government will replace the earlier Consumer Protection Act, 1986, with a new law worked according to the provisions made in the revised 2015 UN guidelines on consumer protection.
The new consumer protection law would crack down on misleading advertisements, and ensure that consumer grievances are redressed in a time-bound and cost-effective manner.
"Stringent provisions are proposed against misleading advertisements. A Central Consumer Protection Authority with executive powers will be constituted for quick remedial action," the PM said, while adding that new India will have Best Consumer Practices and Consumer Prosperity.
In such a scenario, a homebuyer will have two channels to lodge a complaint against a developer in case he is misinformed about a housing project through advertisements. While he would be able to approach the Real Estate Regulatory Authority in his state, he would also be able to knock the doors of the Central Consumer Protection Authority.
The real estate law says that a real estate regulatory authority may revoke the registration of a developer if "the promoter permits the publication of any advertisement or prospectus whether in any newspaper or otherwise of services that are not intended to be offered".
With inputs from Housing News