WB law on real estate repugnant to Centre’s RERA for having overlapping provisions: SC

A separate law made by the West Bengal government in 2017 to regulate real estate sector could not withstand scrutiny in the Supreme Court which on Tuesday said it was “repugnantâ€? to Centre’s Real Estate (Regulation and Development) Act (RERA) for having same subject and overlapping provisions.

The constitutional principle of “repugnancy”, which primarily deals with the issue as to whether a parliamentary law or a state law would prevail if both are competent to legislate on subjects as they fall under the concurrent list of Constitution, was used by the apex court for testing the validity of the 2017 law made by the Mamta Banerjee-led government to substitute RERA in West Bengal.

A bench comprising Justices D Y Chandrachud and M R Shah held the West Bengal Housing Industry Regulation Act (WB-HIRA), 2017 was repugnant to the RERA, made a year ago by Parliament, and hence was unconstitutional.

“The overlap between the provisions of WB-HIRA and the RERA is so significant as to leave no manner of doubt that the test of repugnancy based on an identity of subject matter is clearly established,” the 190-page verdict written by Justice Chandrachud said.

Article 254 of the Constitution deals with the issue of inconsistencies between laws made by Parliament and by the legislatures of the states and provides for the nature, conditions and extent of repugnancy of the laws made by states.

Elaborating on the constitutional scheme, the top court said one of the salient features of Article 254 is its sub-Article (1) embodies the concept of repugnancy on subjects within the Concurrent List on which both the State legislatures and Parliament are entrusted with the power to enact laws.

“Secondly, a law made by the legislature of a State which is repugnant to Parliamentary legislation on a matter enumerated in the Concurrent List has to yield to a Parliamentary law whether enacted before or after the law made by the State legislature,” the bench said. Â

Thirdly, in the event of a repugnancy, Parliamentary legislation shall prevail and the state law shall “to the extent of the repugnancy” be void, it held.

“Fourthly, the consequence of a repugnancy between the State legislation with a law enacted by Parliament within the ambit of List III can be cured if the State legislation receives the assent of the President,” it said, adding “Fifthly, the grant of Presidential assent … will not preclude Parliament from enacting a law on the subject matter.”

The bench said there was three types of repugnancy and “the first envisages a situation of an absolute or irreconcilable conflict or inconsistency between a provision contained in a State legislative enactment with a Parliamentary law with reference to a matter in the Concurrent List.”

Such a conflict brings both the statutes into a state of direct collision and a conflict arises because it is impossible to comply with one of the two statutes without disobeying the other, it said.

“The second situation involving a conflict between State and Central legislations may arise in a situation where Parliament has evinced an intent to occupy the whole field. The notion of occupying a field emerges when a Parliamentary legislation is so complete and exhaustive as a Code as to preclude the existence of any other legislation by the State.

“The State law in this context has to give way to a Parliamentary enactment not because of an actual conflict with the absolute terms of a Parliamentary law but because the nature of the legislation enacted by Parliament is such as to constitute a complete and exhaustive Code on the subject,” the judgement said.

The third test of repugnancy is where the law enacted by Parliament and by the state legislature regulate the same subject and in such a case the repugnancy does not arise because of a conflict between the fields covered by the two enactments but because the subject which is sought to be covered by the state legislation is identical to and overlaps with the Central legislation on the subject, it said.

The top court analysed and compared the West Bengal law with the Centre’s law and struck the state statute holding that the “identity of subject matter is clearly established”.

The judgement came on a plea of ‘Forum For People’s Collective Efforts’ , an umbrella homebuyers association, challenging the constitutional validity of West Bengal Housing Industry Regulation Act, 2017, which is more or less identical to the Centre’s RERA.