WHAT IS RERA ?

The Real Estate (Regulation and Development) Act, 2016 (the Act, from here on) is an initiative by Indian Government to enhance transparency in the real estate related transactions by creating a systematic and a uniform regulatory environment, thereby protecting consumers’ interest and making real estate developers liable for timely completion of projects.

IS RERA APPLICABLE TO BOTH COMMERCIAL AND RESIDENTIAL PROJECTS ?

Initially, the bill was supposed to cover only residential projects. On further amendments, commercial projects including shops, offices and buildings were also included.

HOW DOES RERA SAFEGUARD THE RIGHTS OF A CONSUMER ?

a. As per the RERA rules, the consumer is entitled to receive information about the sanctioned plan, approved layout plan, stage wise progress of the project, carpet area and facilitation of basic amenities & services such as drinking water, electricity, sanitation etc.

b. The consumers can claim possession of the unit and the association of consumers can collectively claim possession of the common areas as declared by the real estate developer.

c. In case the real estate developer fails to meet the timeline or does not deliver what was promised then the consumer has the right to claim refund of amount paid with prescribed interest and compensation for the same.

AS PER RERA WHAT ARE THE RESPONSIBILITIES OF THE CONSUMER ?

a. It is mandatory for the consumers to make payments on time to the real estate developer as per the agreement. He/she is also liable to pay the share of registration charges, municipal taxes, maintenance charges, ground rent, electricity charges, water supply charges etc.

b. Once the real estate developer issue the occupancy certificate, the consumer is required to take possession within two months.

c. The consumer is liable to pay prescribed interest if he/she fails to make timely payments for his purchase.

d. It is mandatory for a consumer to actively participate in the formation of an association, a consumer federal or any cooperative society.

e. A consumer must participate towards the registration of the conveyance deed of the unit.

WHAT ARE THE RESPONSIBILITIES OF THE REAL ESTATE DEVELOPER AS PER THE RERA GUIDELINES ?

In order to escalate the responsibility and accountability of real estate developers towards consumers, the RERA has made the following compulsory for them:

a. It is mandatory for the real estate developer to register the project with the RERA and obtain a valid registration number before proceeding.

b. Any kind of marketing, advertising or selling of units is strictly prohibited before the registration of the project.

c. The real estate developer is required to submit all documents related to the project which is considered necessary by the RERA.

d. The real estate developer must deposit 70% of the payment received from the consumers in an escrow account and ensure that the amount is solely used for the development of the project for which it was taken.

e. The real estate developer must adhere to the project plan at all times.

f. Refund the money taken from the consumers with an applicable interest in case the project cannot be completed.

g. Compensate the consumer for the time delay if any.

h. To repair any structural defects in the construction even after 5 years of handover of the project.

WHAT ARE THE DOCUMENTS REQUIRED BY A REAL ESTATE DEVELOPER WHILE REGISTERING A PROJECT WITH RERA ?

The following documents are required while registering a project with RERA:

a. Details of the project such as name, address, type, names and photographs of the promoters etc.

b. Details of the project already launched by the real estate developer and their status (in the preceding 5 years).

c. Approval and commencement certificates obtained from the competent authority for each phase of the project separately. This is to the benefit of both consumer who will firmly know that no changes in the particular phase will be further allowed and the real estate developer who will enjoy the flexibility of changing plans for future phases of the entire project.

d. Sanctioned layout plan, the development plan for the project and details of basic facilities being made available like drinking water, electricity etc.

e. Pro forma of allotment letter, agreement for sale and conveyance deed to be signed with the consumers.

f. Location of the project with clear demarcation of the land for the project.

g. Number, type and carpet areas of units to be sold.

h. The details of open areas if any like terraces, balconies etc.

i. Details of associated engineers, contractors, architects and intermediaries in the project.

j. A declaration stating that the land of the project is verified &authenticated and the developer has a legal title to it.

k. A written declaration stating that the project will be completed within specified period of time and 70% of the received funds from the consumers will be deposited in a dedicated escrow account and this amount will be used only for that particular project.