The Real Estate Regulatory Authority casts an onerous responsibility on developers, in the form of project registration and obligatory disclosures on a daily basis through a portal to be maintained by the RERA; thus giving buyers the ability to analyze the reliability of the builder as well as the project before making their investment decision. One may also have to worry about similar responsibility being cast on a real estate agent or marketing agents under the bill. Apart from the disclosures, the bill also mandates the developers to honor their commitment in terms of timelines, quality, facility, etc and gives that any default on the part of the builder could result in revocation of the project listings, ceasing of bank accounts and handover of development rights to the builders or third party. The bill also provides for severe penal and trial consequences in case of defaults or non-compliance's and entails listing the builder as a defaulter on the portal.
The Bill also seeks to arrangement a faster clash redressal mechanism, with the establishment of the Real Estate Appellate Tribunal, which shall have the command to regulate its own procedure. While these disclosures will provide buyers the requisite data to take well-versed decisions, use of such data by unprincipled elements needs to be addressed to maintain a healthy competition.
Key features of RERA:
- Applicable to both residential and commercial developments, with some exemptions
- RERA to be established for dispute redressal
- Disclosure on the part of developers – track record, litigations, development status, approvals obtained, etc.
- Mandatory to deposit 50 percent of realization amount in an Escrow Account; to be used only for construction
- Bigger responsibility cast on the Agents/ marketing agents
- Buyers grant with more rights
- In case of contravention by the developers, deregistration of projects, duty of penalty and other financial consequences
- Advance by promoter not in excess of 10 percent, without written agreement
