Real Estate Regulation Act – RERA
The Real Estate (Regulation and Development) Act, 2016 is an Act of the Parliament of India which aims at protecting home buyers and also to boost investments in the real estate industry. It is advisable to consult a top lawyer to conduct all your property dealings.
The Act is established under Real Estate Regulatory Authority (RERA) in the state for proper regulation of the real estate sector. The Bill was passed by on 10th March 2016 by Rajya Sabha and on 15th March 2016 by Lok Sabha. The act came into force from 1st May 2016 with 59 sections notified out of 92 sections. The remaining provisions came into being from 1st May 2017. Within a statutory period of six months, the Central and State government became liable to notify the rules under the Act.
The Real Estate Act makes it mandatory to register all the projects where the land is over 500 square meters or eight apartments with the Real Estate Regulatory Authority (RERA) to provide greater transparency in project marketing and execution. The registration process is applicable to both, commercial and residential sectors of India. For all ongoing projects and the ones that had not received a completion certificate on the date of commencement of the Act were given the leverage of registering within 3 months from the date the Act had been issued.
The RERA holds the right to either approve or reject an application for registration within a period of 30 days from the date the application was functional.
On successful registration, the person in charge of the project is provided with a registration number, login id, and password. The applicant can use these credentials to fill up essential details on the RERA website.
On failure of the registration, RERA has the authority to impose a penalty of up to 10 percent of the project cost or three years of imprisonment to the applicant.
Real estate agents who facilitate selling and purchase of properties (both commercial and residential) must take prior registration from RERA consultants. Such agents are issued with a single registration number for each State or Union Territory. This registration number should be quoted by the agent for every sale that he facilitates.
The Act prohibits from draining the extra amount of funds through the investors. As per the RERA rule, 70 percent of the money deposit is made compulsory in the bank accounts through cheques. This Act has benefited the consumers as the builders will now have to quote prices based on the carpet area of the property instead of super built-up area. The Act defines carpet area as usable spaces including kitchen and toilets.
At October 31, 2016, Central Government released the Real Estate (Regulation and Development) general rules along with a proclamation from Ministry of Housing & Urban Poverty Alleviation (HUPA). The rules issued by the Central Government are applicable to the five Union Territories without Legislature. The five UN territories are Andaman & Nicobar Islands, Daman & Diu, Dadra & Nagar Haveli, Lakshadweep and Chandigarh.
The Act under Section 84 states that when RERA Act is enforced, the State Government shall make rules for carrying out provisions of the Act within six months of its working.
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