RIGHTS OF HOME BUYER UNDER RERA

Dec 18 2018

1. The right of Information:

The allottee shall be entitled to obtain the information relating to sanctioned plans, layout plans along with the specifications, approved by the competent authority and such other information as provided in this Act or the rules and regulations made thereunder or the agreement for sale signed with the promoter. (Section 19(1) of the RERA Act)

2. The right to know stage wise progress of Project:

The allottee shall be entitled to know stage-wise time schedule of completion of the project, including the provisions for water, sanitation, electricity and other amenities and services as agreed to between the promoter and the allottee, in accordance with the terms and conditions of the agreement for sale. (Section 19(2) of the RERA Act)

3. The right of Possession:

The allottee shall be entitled to claim the possession of apartment, plot or building, as the case may be, and the association of allottees shall be entitled to claim the possession of the common areas, as per the declaration provided by the promoter under subclause (C) of clause (I) of sub-section (2) of section 4. (Section 19(3) of the RERA Act)

4. The right to Documents and Plans:

The allottee shall be entitled to have the necessary documents and plans, including that of common areas, after handing over the physical possession of the apartment or plot or building as the case may be, by the promoter. (Section 19(5) of the RERA Act)

5. The right of refund for failure to give possession:

The allottee shall be entitled to claim the refund of amount paid along with interest at such rate as may be prescribed and compensation in the manner as provided under this Act, from the promoter, if the promoter fails to comply or is unable to give possession of the apartment, plot or building, as the case may be, in accordance with the terms of agreement for sale or due to discontinuance of his business as a developer on account of suspension or revocation of his registration under the provisions of this Act or the rules or regulations made thereunder. (Section 19(4) of the RERA Act)

6. The right of Compensation & Cancellation on false information etc:

a) Right of Compensation

Where any person makes an advance or a deposit on the basis of the information contained in the notice, advertisement or prospectus, or on the basis of any model apartment, plot or building, as the case may be, and sustains any loss or damage by reason of any incorrect, false statement included therein, he shall be compensated by the promoter in the manner as provided under this Act:

b.) Rate of Interest:

The rate of interest payable by the promoters to the allottees shall be the State Bank of India highest Marginal Cost of Lending Rate plus two percent:

Provided that in case the State Bank of India Marginal Cost of Lending Rate is not in use it would be replaced by such benchmark lending rates which the State Bank of India may fix from time to time for lending to the general public. (Rule 18 of the Maharashtra Rules)

c.) Timeline for Refund:

The refund of any amount which is payable by the promoters to allottees along with the applicable interest and compensation, if any, under the Act or the Rules and Regulations, shall be made by the Promoter to the allottee within 30 days from the date on which such refund along with applicable Interest and Compensation, becomes due and payable to the allottee:

Provided that, every instance thereof shall be reported by the concerned promoters within thirty days to the Authority. (Rule 19 of the Maharashtra Rules)


Registration of Project under RERA

Dec 18 2018

1. Registration criteria

Every project where the area of the land propose to be developed exceeds 500 meters as the number of apartment proposes to be developed or number of apartment exceeds 8, such project shall be compulsory required to be registered by the promoter with the Real Estate Regulator Authority (RERA).

2. Application for Registration of Real Estate Project shall state

(A) that he has a legal title to the land on which the development is proposed along with legally valid documents with authentication of such title, if such land is owned by another person
(B) that the land is free from all encumbrances, or as the case may be details of the encumbrances on such land including any rights, title, interest or name of any party in or over such land along with details
(C) the time period within which he undertakes to complete the project or phase thereof, as the case may be

3. Grant of Registration

(1) On receipt of the application the Authority shall within a period of thirty days.
(a) grant registration subject to the provisions of this Act and the rules and regulations made thereunder, and provide a registration number, including a Login Id and password to the applicant for accessing the website of the Authority and to create his web page and to fill there in the details of the proposed project or
(b) reject the application for reasons to be recorded in writing, if such application does not conform to the provisions of this Act or the rules or regulations made thereunder:
Provided that no application shall be rejected unless the applicant has been given an opportunity of being heard in the matter.

4. Deemed Registration

If the Authority fails to grant the registration or reject the application, as the case may be within the stipulated period of thirty days, the project shall be deemed to have been registered, and the Authority shall within a period of seven days of the expiry of the said period of thirty days, provide a registration number and a Login Id and password to the promoter for accessing the website of the Authority and to create his web page and to fill therein the details of the proposed project.

5. Validity of Registration

The registration granted under this Act shall be valid for a period declared by the promoter for completion of the project or phase there of, as the case may be.
The registration so granted may be extended by the authority due to “force majeure”
Explanation — For the purpose of this section, the expression “force majeure” shall mean a case of war, flood, drought, fire, cyclone, earthquake or any other calamity caused by nature affecting the regular development of the real estate project.

6. Revocation of Registration

i) Incase the Promoter makes any default in carrying out a project as stipulated or violates any terms or conditions of the approval or is involved in any kind of unfair practice or irregularity, such registration may be revoked.
The term “unfair practice means”,
“a practice which, for the purpose of promoting the sale or development of any real estate project adopts any unfair method or unfair or deceptive practice including any of the following practices, namely:—
(A) the practice of making any statement, whether in writing or by visible representation which:—
(i) falsely represents that the services are of a particular standard or grade
(ii) represents that the promoter has approval or affiliation which such promoter does not have
(iii) makes a false or misleading representation concerning the services

(B) the promoter permits the publication of any advertisement or prospectus whether in any newspaper or otherwise of services that are not intended to be offered.

(C) the promoter indulges in any fraudulent practices.
(i) On revocation of registration, the regulatory authority in consultation with the State / Central Government may take such action including carrying out on the remaining development work in the manner in which it shall be carried out. Further, the association of allottees in such case shall have the first right of refusal for carrying out the development work.

7. Marketing

Promoter shall not advertise, market, book, sell or offer for sale, or invite persons to purchase in any manner any plot, apartment or building, as the case may be, in any real estate project or part of it, in any planning area, without registering the real estate project with the Real Estate Regulatory Authority.

8. Ongoing Projects

Projects that are ongoing on the date of commencement of this Act and for which the completion certificate has not been issued, the promoter shall make an application to the Authority for registration of the said project within a period of three months from the date of commencement of this Act.


Introduction to RERA Act

Dec 18 2018

BACKGROUND

Housing sector is one of the top contributors to country’s GDP and employment creation. Surprisingly, inspite of being such an important part of the economy, the real estate sector has remained by and large unregulated. The Real Estate sector is, to a limited extent, controlled and regulated at the local government’s level with every state government having its own set of rules and regulations for real estate development. Taking benefit of country’s abysmal judicial system, the developers have been taking property buyers for a ride, and putting real estate sector on the bottom of customer protection and satisfaction pyramid.With the things getting bad to worse, it has let to big hue and cry, making urgent need for a unified regulatory legal framework to protect customers’ interest.

INTRODUCTION

To address the various structured issue in the real estate sector, the Central Government enacted “The Real Estate (Regulation and Development) Act, 2016” which received the President’s assent on 25th March 2016.The Act has been partly notified w.e.f. 1st May 2016, as far it concerns to the establishment of Regulatory Authority, Central Advisory Council and Appellate Tribunal and administration. However, the operative part of the Act is yet to be notified. In all probabilities this will come effective only after the States have put the administrative mechanism in place. Preamble: Highlighting the core of enacting this Act, the Preamble of the Act states; “An Act to establish the Real Estate Regulatory Authority for regulation and promotion of the real estate sector and to ensure sale of plot, apartment or building, as the case may be, or sale of real estate project, in an efficient and transparent manner and to protect the interest of consumers in the real estate sector and to establish an adjudicating mechanism for speedy dispute redressal and also to establish the Appellate Tribunal to hear appeals from the decisions, directions or orders of the Real Estate Regulatory Authority and the adjudicating officer and for matters connected there with or incidental there to.”

Preamble

Highlighting the core of enacting this Act, the Preamble of the Act states; “An Act to establish the Real Estate Regulatory Authority for regulation and promotion of the real estate sector and to ensure sale of plot, apartment or building, as the case may be, or sale of real estate project, in an efficient and transparent manner and to protect the interest of consumers in the real estate sector and to establish an adjudicating mechanism for speedy dispute redressal and also to establish the Appellate Tribunal to hear appeals from the decisions, directions or orders of the Real Estate Regulatory Authority and the adjudicating officer and for matters connected there with or incidental there to.”


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