1. Who are required to obtain Registration?
Under RERA, All builders and promoters who undertake a real estate project with over 8 units or 500 square meters of development are required to obtain RERA registration and fall under the ambit of RERA regulations.
2. What are the Duties of Promoter?
A promoter in the real estate sector has the following functions and duties-
• The promoter has to get their proposed project registered with the RERA.
• After getting done with the registration, the promoter is required to create a web page and display the project on the website of RERA so as to make the details available for the public.
• The promoter can’t initiate to advertise or make offer for sale of the proposed project without registering the project.
• The Promoter is required to provide certain documents at the time of booking and issue of allotment letter such as- Sanctioned plans, layout plans, along with specifications, approved by the competent authority.
• The promoter is also required to clearly mention the stage-wise time schedule for completion of the project, including the provisions for civic infrastructure like water, sanitation, and electricity.
• The promoter is also required to obtain the completion certificate and the occupancy certificate from the relevant competent authority as per local laws or other laws for the time being in force and to make it available to the allottees individually or to the association of allottees, as the case may be.
• He is also required to obtain the lease certificate, where the real estate project is developed on a leasehold land, specifying the period of lease, and certifying that all dues and charges in regard to the leasehold land have been paid, and to provide the lease certificate to the association of allottees.
• He is also required to refund the amount received in case of failure to give possession on time.
3. What are the Points to remember for the Promoter in order Advertise its Project?
The promoter shall abide by the following points in order to be RERA Complaint.
- Register all the real estate projects with RERA.
- Get all the sale agreements executed in the prescribed format and registered as per the prevailing laws.
- Deposit 70% of advances received from allottees in a separate bank account opened for each project.
- Update quarterly, the stage-wise progress of the project and the number of bookings, in the web portal of RERA.
- Adhere to the sanctioned plans and project specifications.
- Be responsible for any structural defect or any other defect in workmanship, quality or provision of services for a period of five years from the date of handing over.
- Facilitate the formation of an association of allottees within a period of three months of the majority of allottees having booked the apartment/plot.
- Provide and maintain essential services on reasonable charges till taking overcharge by the association of allottees. –
- Pay all outgoing charges until the transfer of physical possession of projects.
- Obtain all insurances on the title of the land, building, and construction of the project and pay premium and charges and also hand over all related documents, to allottees/association.
- Obtain Occupancy Certificate and make it available to allottees/association.
- Execute conveyance deed in favor of allottee within three months from the date of receipt of the Occupancy Certificate.
- Obtain Lease Certificate, if the project is developed on leasehold land and make it available to allottee/association.
- Furnish a copy of all the documents/approvals/sanctions/drawings and plans to the allottee and original to the association at the time of exit of the project.
- Handover copy/original of the above documents to the association before exiting the project.
- Compensate the allottees for any delay of the project or defective title of the land or any other such loss that is caused to the allottee.
4. What is the Agenda to implement RERA Act in respect of Real Estate Sector?
RERA has been implemented with a prime agenda to ensure that the sales of properties are in an efficient and transparent manner. Ultimately defending the interest of consumers, RERA has established a mechanism for every category and department of the sector. The builders are the base of the real estate sector as they bridge the gap between the construction ability and the buyers need. RERA which ushers in transparency, accountability and efficiency in the sector, has impacted developers in many ways. While we wish that the buyer should not experience delays, of any nature, the developers have to fall in line by sharing all information as required by the authority. The information should then accessible online and finally, a feedback mechanism has to be designed between the authority, the promoter and the buyer.
5. What are the Compliances required to be followed by the Promoter pursuant to RERA Act?
- The builder will have to buy land, get all the necessary approvals and then only they can declare the launch of the project. The builders will have to get all the necessary clearances before they can sell the project. The cost of the project for the developer will increase as now sales will start post-registration, so no pre-launches!
- For all the ongoing projects the promoters have a deadline of 31st July 2017 to get their ongoing projects registered with RERA.
- Due to Pandemic, the Ministry extended the Registration for 6 months from May, 2020.
- The booking procedure will be completely revised under RERA. Crucial information like the stage-wise time schedule of completion of the project (including every provision like water, sanitation, etc.) will have to be shared with the buyer. At the time of booking itself, the promoter will have to issue the allotment letter which contains all the above-stated information.
- Every advertisement shall have registration number of the project. The registration number will be obtained only after the project gets registered. For all kinds of advertising or promotion, the details like the developer’s background, projects launched by the developer in the past five years, the status of the ongoing project has to be shared.
- The promoter should also have the list of approvals and commencement certificate from the competent authority, failing which advertisement and sales related activities will be suspended. They would need all these documents while presenting the project to the customer.
- In case of any structural defect (like a quality compromise) or provision of promised services or any other obligations from the promoters end as per the agreement for sale, if brought to the notice within a period of five years, it shall be the duty of the promoter to rectify such defects without further charge, within 30 days.
- The promoter is also liable to return the total amount with interest at the rate as mentioned in the agreement for sale if it fails to complete or is unable to give possession of the property within the agreed time-period.
- In case the buyer does not intend to withdraw from the project, he/she will be paid, by the promoter along with the interest for every month of delay, till the handing over of the possession.
- Now, as per RERA, a promoter can only accept 10 percent of the cost of the property, as an advance payment, at the time of first entering into a registered agreement for sale.
- 70% of the payment received has to be directly deposited in a
- Separate account and money from it can be withdrawn stage-wise only for that particular project.
- The promoter has to clearly disclose to the buyer the carpet area of the flat/unit being sold and has to state the date at which the project will be completed. In case of any delay in the same, the promoter is liable to pay the rate of interest in case of any default.
- In case the builder doesn’t adhere to the RERA regulations, he will not only lose on the registration of the project but can also face imprisonment for up to 3 years.
- UP- RERA has implemented separate Bank Account Directions,2020, for promoter to ensure its compliance.
The government is taking all the measures to promote Real Estate Sector and protecting the Interest of Promoters and Allottees. The step of creating RERA is a to channelize, Regulate and ensuring timely delivery of Flats and/or Plots and Authority being Watchful, regulating and Controlling helps in Expediting Initiation and Implementation.
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