DIFFICULTY IN ISSUE OF CA CERTIFICATE UNDER UP RERA
[for the purpose of withdrawal of money from designated bank account of the project]
As per the provision of The Real Estate (Regulation and Development) Act 2016 (RERA),
As per section 4(2)(l)(D) of RERA Act;
‘seventy per cent. of the amounts realised for the real estate project from the allottees, from time to time, shall be deposited in a separate account to be maintained in a scheduled bank to cover the cost of construction and the land cost and shall be used only for that purpose:
Provided further that the amounts from the separate account shall be withdrawn by the promoter after it is certified by an engineer, an architect and a chartered accountant in practice that the withdrawal is in proportion to the percentage of completion of the project’
Hence, as per the above provisions, CA Certificate is required for the purpose of withdrawal of money from designated bank account.
The Govt. has uploaded a CA Certificate format in Form-S on http://up-rera.in/finalcertificates/finalcertificates/CACertificate.xlsx just some days back.
After reviewing the Form-S, the following discrepancies found and the same has been brought in the notice of UP RERA department;
“that as per the uploaded CA Certificate format for withdrawing amount qtly from designated bank (70%), the following points need to be clarified;
1. As per the S.No.7;
“ Amount that can be withdrawn from Designated a/c, i.e.
(Row 6a* Row 5a) or (Column 4 of Row 4),whichever is less”
Here it is mentioned ‘Less’ but if we calculate the amount for withdrawal from designated bank we need to consider ‘whichever is More’, hence pls clarify either Less is ok OR More to be replaced, awaiting for your reply.
2. As per the S.No.3;
“ Cost of Development / Cost of construction”
Here most of the heads of expenses mentioned, but about project financing charges/interest paid on project loan taken etc. not mentioned, so can we insert a sub-heading like this just after (d)….(e) Other cost related to construction (other than above, including finance cost)…..and consider all other direct costs attributable to construction of project directly which is not incorporated in any head of expenses…
As per section 11(g) of RERA Act;
‘ pay all outgoings until he transfers the physical possession of the real estate project to the allottee or the associations of allottees, as the case may be, which he has collected from the allottees, for the payment of outgoings (including land cost, ground rent, municipal or other local taxes, charges for water or electricity, maintenance charges, including mortgage loan and interest on mortgages or other encumbrances and such other liabilities payable to competent authorities, banks and financial institutions, which are related to the project)’
Hence, as per the above section, the cost of financing of the project needs to be incorporated in CA certificate format, further if also refer the Maha Rera CA certificate, the same is clearly mentioned.
Conclusion; according to my point of view & interpretation, the cost of finance of the project is required to be incorporated in CA certificate, and the calculation formula for eligibility for withdrawal from designated bank account (70%) is also to be modified.
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