Until May 2016 there were proposed bills for regulation and promotion of the real estate sector to ensure fair deal between buyers and sellers in a more transparent manner. In May 2016 Parliament enacted an Act Known as Real Estate (Regulation and Development) Act, 2016 which has come in force with all its 92 sections from 1st of May 2017 across India. According to that Act every promoter and agent selling property in different states of India has to first get their projects registered with that State RERA Authority. So far, 14 states and Union territory such as Maharashtra, Madhya Pradesh, Delhi, Uttar Pradesh, Gujarat and Bihar have notified their rules with RERA and many others have issued draft which is yet to be notified.
The Intention for the implementation of RERA is to make Builders more accountable for the timely delivery of the projects and to protect buyers from fraud sellers. For that purpose RERA Authorities has prescribed a simple and transparent procedure for registration of Real Estate Projects and Agents.
Here is the bird-view of Registration process under RERA Act:
Registration of Projects under RERA
All commercial and residential real estate projects will have to register by submitting documents along with the prescribed fees except in projects where:
- The promoter has received completion certificate of the project prior to commencement of Act
- The area of land proposed to be developed does not exceed 500 sq. mt
- The number of apartments is not more than 8
- Any repair or renovation of an existing building or structure that does not require marketing, advertising and selling of any apartment or plot
Documents required for registration under RERA
The following documents are required to be submitted in triplicate:
- PAN Card of the builder
- ITR of last 3 years and the balance sheet of the builder
- Builder must clarify about the apartment (carpet area, number of floors, parking space)
- Declaration by the builder of having legal title of the land with proof
- Details of the land (rights, title, mortgage)
- If the builder is not the owner of the land, the consent letter of the actual owner with documents will be required
- Details of the project (location, sanctioned plan, layout plan)
- Ownership documents (proforma of allotment letter, agreement of sale)
- Information of the persons involved (Architects, Engineers and others)
Registration Process for Real Estate Agents
- File an application form along with fee and documents to get registered with RERA
- You will receive a registration number from the regulator. This need to be mentioned in every property sale
- On a quarterly basis, you are required to maintain the books of account, records and documents related to the transactions
- Share all the information and documents about the project with the buyer
- Agent may be suspended for the misrepresentation or fraud during the registration process.
Further the center has clarified through a press release that the Promoters and agents are required to get their on-going projects registered with 3 months of the Act applies i.e. 31st, July 2017. Also Non Registration of Projects will attract heavy penalty under RERA Act.
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.