RERA REGISTRATION- THE KEY OF REAL ESTATE GROWTH
WHAT IS RERA? AND HOW IT IS CONNECTED TO REAL ESTATE GROWTH?
WHAT IS RERA AND HOW IT WORKS IN RAJASTHAN?
RERA STAND FOR Real estate regulatory Authority, this Authority works for the registration of the real estate project both commercial and residential to facilitate the growth and promotion of a healthy, transparent, efficient, and competitive real estate sector while protecting the interest of allottees, promoters, and real estate agents. The Real Estate (Regulation and Development) Act, 2016 was brought into effect by Govt. of India on 01.05.2016. Each state has its different rules under the Act. The Rajasthan Real Estate (Regulation and Development) Rules, 2017 were notified on 01.05.2017. Govt. of Rajasthan has constituted the Rajasthan Real Estate Regulatory Authority (Raj.RERA) on 06.03.2019.
WHAT ARE THE BEFIT OF RERA REGISTRATION?
The real estate has grown in recent years but has largely been unregulated from the perspective of consumer protection. Though consumer protection laws are available, the options available therein are only curative, but not preventive. This has affected the overall potential growth of the sector due to the absence of professionalism and standardization.
BENEFIT FOR THE ALLOWED
- STANDARD CARPER AREA NOMES.
- RATE OF INTEREST ON DEFAULT
- REDUCE THE RISK OF BUILDERS INSOLVENCY
- VARIOUS RIGHTS PROVIDED TO THE BUYER
- ADVANCE PAYMENT CAN NOT BE MORE THAN 10 %
- RIGHT OF BUYER IN CASE OF DEFECTIVE FLAT OR BUILDING
BENEFIT FOR THE REAL ESTATE SECTOR GROWTH
- ENSURE ACCOUNTABILITY TOWARDS ALLOTTEES AND PROTECT THEIR INTEREST.
- INFUSE TRANSPARENCY, ENSURE FAIR-PLAY AND REDUCE FRAUDS & DELAYS.
- INTRODUCE PROFESSIONALISM AND PAN INDIA STANDARDIZATION.
- ESTABLISH SYMMETRY OF INFORMATION BETWEEN THE PROMOTER AND ALLOTTEE.
- IMPOSING CERTAIN RESPONSIBILITIES ON BOTH PROMOTER AND ALLOTTEES.
- ESTABLISH REGULATORY OVERSIGHT MECHANISM TO ENFORCE CONTRACTS.
- ESTABLISH FAST-TRACK DISPUTE RESOLUTION MECHANISM.
- PROMOTE GOOD GOVERNANCE IN THE SECTOR WHICH IN TURN WOULD CREATE INVESTOR CONFIDENCE.
WHO REQUIRED THE REGISTRATION UNDER RERA ACT
The promoter, as well as Real Estate Agent, required registration under the rules of the RERA act
The promoter cannot advertise his project for sale before registration under the RERA act. All the commercial and residential projects whether it is an ongoing project or future project required registration under the Rera act and rules thereof except the following project falling in the area mentioned in section 3(2).
- Where the area of land proposed to be developed does not exceed five hundred square meters or the number of apartments proposed to be developed does not exceed eight, inclusive of all phases. The State Govt. may reduce the threshold below 500 sqm. or 8 apartments.
- Where the promoter has received completion certificate for a real estate project prior to commencement of the Act, i.e. 1st May 2017.
- for the purpose of renovation or repair or re-development which does not involve marketing, advertising selling, or new allotment of any apartment, plot, or building, as the case may be, under the real estate project.
WHAT ARE THE CONSEQUENCES OR PENALTY ON NON REGISTRATION
PENALTY ON PROMOTER
As per section 59, where under the Act,
- The promoter shall be liable for a penalty up to ten percent of the estimated cost of the real estate project, which is required to be registered.
- If Default continues and promoter does not comply with the directions/orders of the Authority as regarding registration of the project with the Authority, he shall be liable to an additional fine of ten percent of the estimated cost of the real estate project or imprisonment up to 3 years or both.
WHAT ARE THE RULES APPLICABLE AFTER REGISTRATION
- Promoters cannot take advance from the customer more than 10 % of the price.
- Promoter has to deposit 70 % of the amount received in a separate escrow account to be opened for each project carried by the promoter.
WHAT IS REAL ESTATE REGULATORY AUTHORITY
Section 31 of the Act provides for filing of a complaint by an aggrieved with the Regulatory Authority. Any aggrieved person may file a complaint in Form-N prescribed in Rules. The Complaint shall be accompanied by a fee of rupees 1000/- to be paid through online mode of payment. The manner for filling the complaint has been specified in rule 35 of the Rules.
WHAT IS REAL ESTATE APPELLATE TRIBUNAL
Any aggrieved person can file an appeal to the Real Estate Appellate Tribunal along with the fee of 5000 and the matter will be resolved within 60 days of the filing of the appeal.
CS. Neetu Sharma
Associated Partner of Zumosun Soft Invention/thelegalbank