Provisions To Protect Home Buyers From Misleading Ads

When you pay for a product that is still being constructed, there is often a fear that you might not get what exactly what you ordered. This is especially true of real estate, where home buyers investing in under-construction properties usually complain that what was delivered was nowhere close to what was promised. An oft-repeated grievance is that the picture of the property as projected in the advertisement was completely different from what the end product turned out to be.  

While it is widely believed that there is little defence for the consumer against misleading advertisements, it is not so. There are a number of agencies in India that protect you against misleading advertisements. PropGuide tells you about some of those:

• Grievances Against Misleading Advertisements: To protect buyers from being misguided, the Department of Consumer Affairs had earlier launched a portal named Grievances Against Misleading Advertisements (GAMA). This portal facilitates online registration of complaints by aggrieved consumers for misleading advertisements.

• The Advertisement Standards Council of India (ASCI): It is another authority that protects the consumers from offensive and misleading advertisements. 

• Bureau of Indian Standards: The Central government has also proposed an overhaul of the Bureau of Indian Standards (BIS) Act, the law working for consumer protection. The Centre has also proposed to penalise the parties that are found misusing the Indian Standard (IS) mark. Not complying with the set standards may lead to imprisonment, along with a hefty fine. 

• The Consumers Protection Act, 1986: The Act accords protection to consumers, who can approach the District Consumer Forum and the State Consumer Redressal Commission or the National Consumer Redressal Commission. It is proposed that changes will be made to this Act to make it more effective. A jail term of up to five years, along with hefty penalty might be in the offing. 

• Real Estate (Regulation and Development) Act, 2016: The recently passed Real Estate (Regulation and Development) Act, 2016, has introduced features to curtail any misleading advertisements from developers. The law has even forbidden developers from accepting payments or bookings from consumers before a project has received all requisite approvals and clearances. This protects the consumers from any wrong claims being made by the developer in the pre-launch stage. Developers have also been mandated to return the entire amount so collected from consumers, along with interest, if consumers are affected due to misleading advertisements of developers. The Real Estate Regulatory Authority has also been empowered to award compensation to consumers.

However, while there already are stringent laws, their effective implementation and providing consumers a forum to dispense speedy justice are the need of the hour.