This article deals with the Constitutional validity of The West Bengal Housing Industry Regulation Act, 2017
Case Name: Forum for People’s Collective Efforts (FPCE) & Anr v. the State of West Bengal & Anr.
Case Name: Writ Petition (C) No. 116 of 2019
Date of Judgment: May 4, 2021
Judge(s): Justices D.Y. Chandrachud and M.R. Shah
INTRODUCTION
In this case, the constitutional validity of the West Bengal Housing Industry Regulation Act, 2017 was challenged under Article 32 of the Constitution of India on the ground that the provisions of the West Bengal Housing Industry Regulation Act, 2017 (hereinafter referred to as the “WB-HIRA”) are repugnant with the central legislation namely the Real Estate (Regulation and Development) Act, 2016 on the same subject matter. The court was of the opinion that the state legislation is unconstitutional.
A. FACTUAL BACKGROUND
Prior to the enactment of the Real Estate (Regulation and Development) Act, 2016, several laws were enacted by the State legislatures to regulate the real estate transactions occurring within their states. After the enactment of the said Act, every state repealed their respective state legislature relating to the real estate and every state followed the regulations of the newly created regulatory authority. West Bengal was the only state where RERA was not implemented. Thus, a Civil Writ Petition was filed before the Supreme Court of India on the constitutional validity of the WB-HIRA.
B. ISSUES
1. Does RERA and WB-HIRA cover the same subject matter as they were both passed under Entries 6 and 7 of List III of the Constitution?
2. Whether WB-HIRA violates the Constitution because it fails the repugnancy test?
3. Is it possible for the State Legislature to adopt laws on the same subject matter as the Union and establish a parallel system?
4. Whether the WB-HIRA has received presidential assent?
C. SUBMISSIONS OF COUNSEL
1. For the Petitioner
Adv. Devashish Bharuka argued that both the Central and State enactment pertain to the same subject matter. He submitted that WB-HIRA is repugnant to RERA and it failed all the three tests of repugnancy. It has a direct conflict with the central legislation and has not received Presidential assent and thus, also not protected under Article 254(2) of the Constitution.
2. For the Union of India
Additional Solicitor General Aishwarya Bhati appearing for the Union of India, argued that the Real Estate (Regulation and Development) Act, 2016 is enacted to provide effective protection to real estate buyers and sellers and to ensure uniformity and standardisation throughout the country by bringing into force only one act. The constitutional validity of WB-HIRA has been questioned by the counsel. It was submitted that the WB-HIRA is a similar parallel regime regulating real-estate projects. Such a duplicate regime would result in complete chaos in the real-estate sector of the state in question. She asked to conduct test of Repugnancy which the Act is clearly violating.
3. For the Respondent
Adv. Rakesh Dwivedi appearing for the respondent-state argued that the State enactment was complementary to the Real Estate (Regulation and Development) Act, 2016 which does is not exhaustive. He further submitted that, there is no conflict between the State and Central legislations. Since both these laws have been enacted under different provisions, they cover different subject matters. Thus, the test of repugnancy is not satisfied in the present case.
D. ANALYSIS AND JUDGEMENT
It was observed that both the Central and State legislation fall under the same subject matter of the concurrent list. The provisions are in direct conflict with the Central Act. Under Sections 88 and 89 of the Real Estate (Regulation and Development) Act, 2016, the States may bypass the requirement of Presidential assent under Article 254(2) to enact a statute that is substantially identical to the Real Estate (Regulation and Development) Act, 2016. If WB-HIRA is allowed to operate in West Bengal, it will give way to other states to enter into the matters listed in the concurrent list and make laws that are already enacted by Central Government. The court further noted that the Real Estate (Regulation and Development) Act, 2016 is being implemented throughout the country across different states by notifying the rules except in the State of West Bengal. The petitioner pleaded to issue a writ of mandamus or any other writ or appropriate direction or order by declaring WB-HIRA ultra vires the provisions of the Indian Constitution and to further direct the West Bengal Government to not implement the provisions of WB HIRA in the State of West Bengal. The State did not take Presidential assent under Article 254(2) of the Constitution. So, the implementation of WBHIRA in West Bengal is unconstitutional.
E. CONCLUSION
The Supreme Court held that WB-HIRA is repugnant to RERA and the State Legislature cannot enact laws over the same subject matter as of the Union and create a parallel regime .WBHIRA is held to be unconstitutional
This blog is written by Varun Thokala, an intern of Smriti Legal LLP.
Author Bio
