Karnataka becomes one of the States to penalize heavily on the builders who failed to comply with the Real Estate Regulatory Authority (RERA) Act, whose deadline came to an end on July 31, 2017. Now, the builders who failed to register themselves with RERA Authority are barricaded from advertising, marketing, booking, selling or offering to sell any plot, apartment or building.
For the merit of builders, Karnataka Government notified RERA Rules on July 10, 2017, and launched its website on July 24 so that builders and agents can register themselves to stay clear off the penalty. As per RERA Karnataka, they received 700 registration requests online from builders as well as agents. According to a property consulting firm in Bengaluru, there are 868 ongoing projects and industry estimates around 10,000 real estate agents so if an unregistered agent sells a property, he will face a commodious penalty of Rs 10,000 per day until he complies with RERA Authority.
The penalty can be incremental up to 5% of the total cost of the plot, apartment or building, as the case may be. If a builder fails to comply with the RERA Rule, he will be liable for the penalty which may extend up to 10% of the estimated cost of the project as determined by the RERA Authority. Simultaneously, if the builder continues to violate the law, he may have to face imprisonment for up to 3 years or a fine up to another 10% of the total cost of the property, or both.
Note – Please note that the above article is part of our continuous research on the related matters. It is based on our interpretation of related regulations which may differ person to person. Readers are expected to take expert opinion before relying on above.
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