Real Estate (Regulation & Development) Bill

The Draft Real Estate (Regulation & Development) Bill, 2011 seeks to establish a regulatory mechanism to enforce disclosure, fair practice and accountability norms in the real estate sector, and to provide adjudication machinery for speedy dispute redressal. Currently, the real estate and housing sector is largely unregulated and opaque, with consumers often unable to procure complete information, or enforce accountability against builders and developers in the absence of effective regulation. The sector, in recent years, has also emerged as a source of black money and corruptions in the economy. The Bill is expected to ensure greater accountability towards consumers, bring transparency and fairness in transactions and reduce frauds and delays significantly. The Bill is also intended to promote regulated and orderly growth through efficiency, professionalism and standardization. Registration of Real Estate Project As per Section 3 of the Bill, No promoter shall develop any immovable property or make any construction on the land exceeding 4000 square meters without registering the real estate project and obtaining the certificate of registration from the Real Estate Regulatory Authority. Each phase of the same project shall be required to registered separately. The promoter shall apply for the registration along with the authenticated copy of all the approval & sanction obtained from the competent authority as may be applicable for the real estate project and promoter’s declaration stating that followings: • The promoter has clear & marketable title over the land • The Land is free from all encumbrances or the case may be, of the encumbrances on such land. • The project shall be completed as per the projections • Seventy percent of the amount realized for the real estate project would be deposited in a separate project account for meeting the only cost of the project. • Agree to submit any further documents as may be prescribed or required by Authority. The Authority shall complete the procedure of the scrutiny of the application within 30 days. No application shall be rejected unless the applicant has been given an opportunity of being heard. The authority shall, after registration, issue a Login Id and password to the applicant to create his web page and to fill therein the details of the project. The registration to the promoter should not be renewed more than two years. Upon lapse of the registration or cancellation of the registration under this Act or if the promoter fails to complete the project as per the registration, the Authority in consultation with Government may take the appropriate steps including the carrying out the development works by competent authority or by the association of allottees or in any other ways. The Authority shall pass the appropriate orders against the defaulting promoters such as directing him to return the money with interest, damages and inscribing his in the list of defaulters on its website. OBLIGATION OF PROMOTERS The promoter shall enter all the following details of the proposed project : • Details of the sanction accorded by competent authority • Details of the registration granted by authority • True disclosure of the title of the land • Full disclosure of the entity of the promoter and its registration details • Periodically updating the list of the booking on the basis of the agreement to sell • Performa of agreement to sell • The number and carpet area of each unit for sale in the project • The plan development works • The name and addresses of real estate agents • The name and address of the architect, engineers and other persons associated with project. • No advertisement and prospectus shall be issued unless filed with authority. • The promoter shall be responsible to make available the allottee all the documents such as approval of government, title to the land etc. • The promoter takes steps for the formation of an association or society of the allottees. • Obtain the completion certificate of the project • To strictly adhere to the approved plans and project specifications. The promoter shall rectify the defects in the development or services if brought to his notice within a year. • The promoter shall effectively transfer the title in favour of the allottee upon completion of the project. • The promoter shall return the amount with interest if he is unable to give possession of the property. Real Estate Appellate Tribunal Any person or appropriate government or competent authority aggrieved by any direction or order of the Authority may prefer an appeal to the Appellate Tribunal within a period of thirty days. The appeal shall be disposed of within a period of ninety days from the date of filing. Where any such appeal could not be disposed of within a period of ninety days, the Appellate Tribunal shall record reasons in writing for not disposing of the appeal within that period.