Real Estate (Regulation &

Development) Act, 2016

(RERA)

EXPLAINED BY MILIND DESHPANDE

What we shall see today ?

TerminologiesDuties of a

Promoter

Penalties for an

offence

Revocation of

the registration

Conveyance

What is the

final message

that RERA

gives us ?

It asks us to

DELIVER

It asks us to

DELIVER in time

It asks us to

DELIVER as

promised

If you don’t

deliver

Compensation

PenaltyInterest

Refund

Terminologies -

Real Estate Project –

Development of a building / apartments

Developing existing building into apartments

Development of land into plots or apartments

But only for the purpose of selling all or some of them

Shall include common areas & all development works

Co - Promoter –

Means and includes any person(s) or organisation(s)

who, under any agreement or arrangement with the

Promoter of a Real Estate Project is allotted to or

entitled to a share of total revenue generated from the

sale of apartments or share of total area developed in

the real estate project.

Terminologies -

Carpet Area –

Carpet area is basically the net usable area of an

apartment. Hence it should be calculated from

skirting to skirting

It does not include the area under the external walls,

areas under service shafts, exclusive balcony,

veranda or an exclusive (attached or overhead)

open terrace

It however includes area under the internal partition

walls but shall exclude the area under structural

columns on the external walls & the internal partition

walls

Terminologies -

Covered Parking Space –

Enclosed or covered area as approved by the Competent

Authority as per the applicable DCR for the parking of

vehicles of the allottees which may be provided in basements

and / or stilt and / or podium and / or parking provided by

mechanised parking arrangements and but shall not include

a garage and / or open parking.

Terminologies -

Phase of a Real Estate Project –

May consist of a building or a wing of

the building in case of building with

multiple wings or defined number of

floors in a multi-storeyed building /

wing. (This will not include land)

Terminologies -

Complainant –

Is any aggrieved person having any interest in the

project and includes an association of allottees and

voluntary organisation registered under any law

Terminologies -

Obligations -

Each project needs to be registered with

MAHARERA before advertisement,

promotion, selling etc. Ongoing projects

can be registered anytime up to 31st July

2017

Submit all the information associated

with the project to the MAHARERA

and get registration ID

Obligations -

The authority shall issue a Login ID &

Password to create a Webpage on

MAHARERA website

www.maharera.mahaonline.gov.in

Once created this webpage needs

to be updated every quarter

disclosing no of apartments booked

and status of the project

Obligations -

No misleading or

false advertisement

Advertisement can be an email, print ad,

whatsapp message, the Model flat on the

site or publicity of any nature

In case of false or misleading

content of advertisement

Obligations -

The allottee can continue the

booking but claim compensation

He can cancel his booking and claim

refund along with interest &

compensation

The Authority can impose

penalty on the Promoter for

providing false information

• SBI MCLR + 2%Rate of

Interest

• Within 30 days

along with

compensation &

interest

Refund

Obligations -

Prominently display the

Authority’s website address and

the Registration ID obtained, in

all the advertisement material

Provide all the documents like

sanctioned plan, layout plan,

specification, stage wise

schedule of construction etc at

the time of booking

Obligations -Agreement for Sale

Promoter shall not accept an amount more than 10% of the cost

of apartment without registering the Agreement for Sale which

shall contain

Particulars of

development of

the project

SpecificationsInternal & External

developments

Dates & manner of

paymentDate of possession

Interest rate for

allottee & Promoter

When an allottee pays you

Obligations -

Keep 70% of the amount received

in a separate bank account

Withdraw the amounts from this

account only when they are certified

by Architect, Engineer & CA

Use it only for the purpose

of the development of the

project

Obtain a certificate from the

statutory auditor stating that the

amount withdrawn

At the end of financial year

Has been utilised for the

same project

Has been in proportion

to the percentage of

completion of the

project

Obligations -

Obligations -

Not to make any

changes with respect

to the apartment

without prior written

consent of the allottee Not to transfer majority

of the rights & liabilities

to any other person

without prior written

consent of 2/3rd of the

allottee

Not to make any

alterations or additions

in layout plan or

specifications without

prior written consent of

2/3rd of the allottee

If the proposed plans /

specifications are disclosed in an

agreement with the allottee which

is executed before the registration

of the project

No Consent is

required

for any modifications in the

sanctioned plans, layout plans and

specifications of the building or

common areas, that is directed by

the competent authority.

No Consent is

required

Consent of 2/3rd allottees for any

change in plans, specifications

Consent

Promoter

Obtain Occupancy /

Completion / Lease

Certificate

Make it available to

the allottee

Provide & maintain

essential services till

the project is handed

over to the society

Obligations -

Form a society or

association of

apartments

Execute the

conveyance in favour of

the society or individual

allottees

Obligations -

Defect liability for 5 years from the

date of possession

The possession date can be different

for buildings and common areas.

Hence the defect liability period also

shall change accordingly

Penalties -

Sells without obtaining

registration with

MAHARERA

Up to 10% of the project cost

In case he continues to do

so even after imposing

penalty

imprisonment up to three

hears or with a fine up to 10%

of the project cost or both

Penalties -

Provides false information for

registration or contravenes any

provision of section 4

Up to 5% of the project

cost

If the promoter contravenes

any other provision of the act,

rules or regulations

Up to 5% of the project

cost

Penalties -

Fails to comply with or

contravenes with any of the

directions of the Authority

Penalty for each day –

maximum up to 5% of the

project cost

If the promoter ails to comply

with or contravenes any of the

directions issued by Appellate

Tribunal

Penalty for each day –

maximum up to 10% of the

project cost

Compounding of

Offences by Court

Minimum 5% of the estimated cost of the project, which may be

extended up to 10%

No further proceedings

shall be taken against

the accused

If any proceedings are

already initiated, the

they shall stand abated

If the accused is

already in custody, he

shall be discharged

Revocation of registration-

Fails to comply with any of the above

obligations r violates the terms of the

approval

Falsely represents that the services

are of a particular standard

Indulges into fraudulent practices

After

Revocation

of

registration-

Debar the promoter

from accessing the

MAHARERA website for

that project

Specify his name n the

list of defaulters and

display his photograph

on its website

Develop the project

with consultation of

state govt

Inform the RERA of

other states & Union

Territories

Freeze the bank

account where the

70% amount was

deposited

If no period is agreed

Conveyance

Single building

Society / entity to be formed

within 3 months from the date on

which 51% units are booked

Conveyance in 3 months from

the date of OC or date on

which 51% of the allottees pay

100% consideration, whichever

is earlier

Society / entity to be formed within 3

months from the date on which 51% units

are booked

If no period is agreed

Apex Body / Federation to be formed

within 3 months from the date on

which OC for the last building is

issued.

Conveyance of building to be done

within 1 month from the society

formation or 3 months from the date

of OC, whichever is earlier

Conveyance of land to be done within

3 month from the Apex Body formation

or the date of OC of the last building,

whichever is earlier

Conveyance

Layout of

buildings

Completion of the project under RERA shall mean –

Completing the entire construction of the project / phase,

Obtaining the OC, handing over the possession,

Formation of the society / association of apartments,

Conveyance,

Completion of all the amenities

Handing over of all title documents, approvals, Insurance papers etc

In general fulfilment of each obligation under RERA.

All such obligations shall be required to be fulfilled before the registration

expires

Milind Deshpande