SC says West Bengal Housing Industry Regulation Act 2017 is “unconstitutional”

The Supreme Court has struck down the West Bengal Housing Industry Regulation Act 2017 as “unconstitutional” as its in conflict with the Real Estate (Regulation and Development) Act 2016.

Justice DY Chandrachud observed that a state legislature cannot enact a law after the Parliament has enacted a similar law on the subject. “Sections 88 and 89 of the RERA did not implicitly permit the states to create their own legislation creating a parallel regime alongside the RERA which would have not required presidential assent,” the bench said. “Hence, it is clear that WBHIRA did not have presidential assent and was repugnant to RERA under Article 254.”

The bench noted that various provisions of the state enactment were directly in conflict with the Central enactment. There is not only a direct conflict of certain provisions between the RERA and WBHIRA but there is also a failure of the state legislature to incorporate statutory safeguards in WBHIRA. This has been introduced in the RERA for protecting the interest of the purchasers of real estate.

As such, the judgement stated that the State legislature has transgressed the limitations on its power and has enacted a law which is repugnant to Parliamentary legislation on the same subject matter. The bench said a significant and even overwhelmingly large part of the WBHIRA overlapped with the provisions of the RERA – provisions of the RERA have been lifted bodily, word for word and enacted into the State enactment.

“In doing so, WBHIRA does not complement the RERA by enacting provisions which may be regarded as in addition to or fortifying the rights, obligations and remedies created by the Central enactment. The subject of the provisions of the State enactment is identical, the content is identical,” the judgement said.

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The court was cautious enough not to create any uncertainty and disruption in respect of actions taken after implementing the WBHIRA in the past. “Since its enforcement in West Bengal, the WBHIRA would have been applied to building projects and implemented by authorities constituted under the law in the state. We direct that the striking down of WBHIRA will not affect the registrations, sanctions and permissions previously granted under the legislation prior to the date of this judgement.”