The Real Estate (Regulation and Development) Act, 2016 (RERA) has become a reality. The Act which was passed by the Union Government last year has come into force from the 1st of May 2016.
The Act in hall has 92 Sections and aims to safeguard the interest of home buyers by penalizing errant builders. As per the act developers has to register all their projects with Regulatory Authorities. For the pending projects and new projects the builders have to register their project within three months, ie July end. This enables the buyers to enforce their rights and seek redressal of grievances after such registration.
The Act ushers in the much desired accountability, transparency and efficiency in the sector with the Act defining the rights and obligations of both the buyers and developers. This important legislation gained momentum under this Government and could see the light finally.
Ahead of the Act coming into force, Ministry of Housing & Urban Poverty Alleviation has formulated and circulated Model Real Estate Regulations for adoption by the Regulatory Authorities in the States/UTs. Under these Regulations, developers are required to display sanctioned plans and layout plans of at least 3 feet X 2 feet size at all marketing offices, other offices where properties are sold, all branch offices and head office of the promoters in addition to the site of project. Real Estate Regulatory Authorities may take decisions on all issues preferably through consensus failing which through voting with Chairman using Casting Vote in case of a tie. There shall be quorum for the meetings of the Regulatory Authorities and if a meeting is adjourned due to lack of such quorum, such meeting can take place without quorum. Members of Regulatory Authorities shall declare interest if any in the matters coming up for discussion and shall not participate there in.
The major provisions of the Act includes depositing 70% of the funds collected from buyers in a separate bank account in case of new projects and 70% of unused funds in case of ongoing projects; Projects with plot size of minimum 500 sq mt or 8 apartments shall be registered with Regulatory Authorities; Both developers and buyers to pay the same penal interest of SBI’s Marginal Cost of Lending Rate plus 2% in case of delays; Liability of developers for structural defects for five years; and imprisonment of up to three years for developers and up to one year in case of agents and buyers for violation of orders of Appellate Tribunals and Regulatory Authorities.
By EPC World Media Group
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