State legislature cannot encroach upon legislative authority of Parliament by enacting law and same shall be unconstitutional
Supreme Court struck down West Bengal Housing Industry Regulation Act, 2017 (WB-HIRA) for conflicting with Central law, Real Estate (Regulation and Development) Act 2016 (RERA)
The Supreme Court observed that “Given the ambit of Entry 24 of List II to the 7th Schedule, there can be no manner of doubt that the subject of WB-HIRA 2017 is not 'industries' within the meaning of Entry 24. RERA and WB-HIRA fall under Entries 6 and 7 of the Concurrent List to the Seventh Schedule. There is a substantial overlap between the provisions of RERA and WB-HIRA. RERA falls within the ambit of Entries 6 and 7 of the Concurrent List. The State of West Bengal is not precluded from seeking to sustain its legislation on the basis that in pith and substance it falls within the ambit of Entries 6 and 7 of the Concurrent List.”
RERA and the State legislation - WB-HIRA have substantially similar provisions. These provisions seek to regulate the contractual relationship between builders/promoters and their buyers in the real estate sector. They recognize rights and obligations between promoters, buyers and real estate agents. Both the State law and the Central law provide for remedial measures to enforce compliance with contractual rights and corresponding obligations. Even the inconsistencies which have been noticed earlier are on the same subject matter. The provisions of RERA essentially seek to regulate the contractual relationship between builders/promoters and purchasers in the real estate sector. RERA, truly speaking, falls within the ambit of Entries 6 and 7 of the Concurrent List. The substantial overlap between the state and the central legislation is evident in a comparative analysis of the two legislations.
The court not only found direct conflict of certain provisions between RERA and WB-HIRA but it was also observed that the State legislature failed to incorporate statutory safeguards in WB-HIRA and provisions intended to protect the interest of home-buyers. The state legislature has transgressed limitations on its power and has enacted a law that is repugnant to Parliamentary legislation on the same subject matter. Hence WB-HIRA being repugnant to RERA held to be unconstitutional.
Appearing counsel/s : Mr Devashish Bharuka, Mr Rakesh Dwivedi
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