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The Real Estate (Regulation and Development) Act, 2016 (RERA) stands as a watershed moment in the Indian real estate sector, ushering in a new era of transparency, accountability, and consumer protection. Since its implementation on 1.5.2017, the sector has witnessed a myriad of changes, reshaping the dynamics of how real estate transactions are conducted and regulated across the nation. In this article, we delve into the transformative journey post-implementation of the RERA Act 2016, examining the key changes, challenges, and opportunities that have emerged. From the perspective of industry stakeholders, regulators, and consumers, we explore the evolving landscape of real estate in light of RERA and its implications on market dynamics, compliance, and consumer rights. Through critical analysis and insights, we aim to provide a comprehensive understanding of the ongoing changes and their impact on the real estate ecosystem, offering valuable perspectives for navigating this dynamic terrain.
| S. No. | Post RERA Practices |
| 1 | Prior Registration of Real estate projects is mandatory – section 3 |
| 2 | Authority either grants or rejects the application for registration within 30 days – Section 5 |
| 3 | Details of registration granted by RERA and project details available on RERA portal/website of the Authority – Section 11 |
| 4 | Details of the Project including Number/ types of apartments or plots booked, approvals granted, NOC’s, the status of the project etc are published by the Authority on RERA Portal/website of the Authority |
| 5 | Sanctioned plan, layout plan, stage-wise schedule of completion of the project including the provisions for civic infrastructures like water, sanitation and electricity available on RERA portal//website of the Authority |
| 6 | RERA Registration Number shall be displayed at Project Site |
| 7 | All advertising or marketing collaterals shall carry Rera Registration Number – Print, hoarding, social media, SMS, Television etc – section 11 |
| 8 | RERA Registration number shall be displayed prominently on advertising or marketing collaterals – Section 11 |
| 9 | Landowner is also Called as promoter under RERA – Equal responsibilities like builder and developers – Section 2 |
| 10 | Project End date is mandatory for every real estate project – the promoter shall complete the project development as per the end date |
| 11 | Exhaustive documents, affidavits, professional certificates are mandatory for RERA Registration |
| 12 | The Promoter is Responsible for obtaining leasehold certificate, commencement and completion/ occupancy certificate / completion certificates for all projects |
| 13 | The Promoter shall provide Estimated Cost of the Project while application for registration. Means the promoters of the project shall prepare the comprehensive plan considering the various aspects / situation / risks in the life cycle of development of the project. |
| 14 | Landowner and Developer both are responsible under the Act as Promoter and liable to deliver to the allottees |
| 15 | Financial management under the Act is mandatory since inception to completion – collection, deposit and withdrawal |
| 16 | Mandatory opening of a Separate Bank Account for Each project |
| 17 | Prior approval of RERA Authority is mandatory for any Change to RERA Separate Bank Account |
| 18 | 70 % amount realised from the allottees shall be deposited into RERA Separate Bank Account |
| 19 | Amount from the RERA Separate bank shall be withdrawn based on % of completion of development work |
| 20 | Withdrawal of money from RERA Separate Bank Account shall be supported by Architect, Engineer and CA certificates certifying the % of completion of development work |
| 21 | RERA Annual Audit Due date is 30th Sep of every year (6 months from the end of financial year) – Applicable to all projects since inception to completion. |
| 22 | RERA Audit report shall be uploaded on the portal of the Authority |
| 23 | Quarterly Updates due date – 15 days from the end of the quarter (K RERA) |
| 24 | Any modification in the sanctioned plan shall require 2/3rd Consent of the Allottees – Section 14 |
| 25 | Change of promoter / transfer of rights requires Section 15 compliance |
| 26 | Modification of plan or change of promoter required to be reported to the RERA Authorities |
| 27 | Extension application for End Date (renewal) for project is mandatory |
| 28 | File application of end date for extension 3 months before End Date |
| 29 | All Compliances shall be in place / filed (Quarterly updates, Annual Audit etc to seek for extension of end date) |
| 30 | Extension of Registration in accordance with Section 6 of the Act |
| 31 | Revocation of RERA Registration of Project by the authority as per Section 7 – Suo Moto or based on complaint received |
| 32 | Display of defaulter list on the website of the Authority and inform to all other states about such defaulter |
| 33 | The promoter shall enable the Formation of Allottees Association once major bookings are done in the project as per Section 11 |
| 34 | Responsible for compensation for loss or damage caused due to incorrect/ false statement made in prospectus or notice of advertisement or in relation to the model apartment, plot or building – Section 12 |
| 35 | Communication to Allottees from time to time about progress of development works in the project |
| 36 | Mention of schedule of development of the projects part of Agreement for Sale |
| 37 | Mention the Carpet Area in all documents (marketing, offer documents, agreement, sale deed etc) |
| 38 | Car Park cannot be sold (only exclusive use of private residence of the project) |
| 39 | No Escalation in price once the agreement is entered with the allottees except in case of increase in statutory levies |
| 40 | Defect Liability is for 5 years – consider the cost of attending / rectifying such defects as part of the cost of the project. |
| 41 | Title Defect – Lifetime, no limitations |
| 42 | Appointment of RERA Registered Agent to promote / market the RERA Registered project |
| 43 | Periodical training of Agents / Channel partners and train them on importance of communication with customers |
| 44 | Filing of completion application on receipt of Completion certificate and completion of developments works and all obligations as per Agreement for sale |
| 45 | Professional Certificate of Architect, Engineer, Chartered Accountants formats are notified by the RERA Authorities |
| 46 | Title Legal report is mandatory and same shall be published in the RERA Authority website for the each project |
| 47 | Title Legal report shall be issued by a advocate having ten years’ experience in handling real estate |
| 48 | Promoter Shall not collect more than 10 % of cost of the unit without entering into Agreement of Sale with the allottees |
| 49 | Agreement for Sale shall be registered as per local laws |
| 50 | Follow Agreement of sale (mandatory) format as notified by RERA – Rule 8A |
| 51 | Cash collection is not permitted as per Agreement for Sale |
| 52 | After executing an agreement for sale, not to mortgage or create a charge on the apartment, plot or building |
| 53 | Cancellation of allotment only in terms of the agreement for sale |
| 54 | Execute a registered conveyance deed of the apartment, plot or building within 3 months from the date of issue of Occupancy Certificate |
| 55 | Providing and maintaining essential services until handover the maintenance to the Association of allottees at a reasonable cost |
| 56 | Handing over of the common areas, project land to the Association of Allottees as per Section 17 of the Act |
| 57 | Penalties for noncompliance are based on % of Estimate Cost of the Project Sec 59 to Sec 68 of the Act |
| 58 | Proper clauses in Joint Development Agreement in relation to roles, responsibilities, mandatory deposit of landowner share of realization of money from the allottees into the project designated bank account, restrictions on withdrawal and utilisation for the development of project and all other compliances under RERA shall be deliberated and mentioned. |
| 59 | Construction insurance and Title Insurance is mandatory for the Project |
| 60 | Same Rate of interest as compensation (maximum of SBI MCLR + 2%) in case of delay by promoter for completion or delay of payment of installment by allottees. |
| 61 | Speedy dispute redressal mechanism and timely disposal of complaints under the Act. |
| 62 | Promoters can forfeit only booking amount in case of cancellation by the Allottee. |
| 63 | The promoter shall file an application to authority for any changes to registration the details |
| 64 | Providing uniform / same data to all the authorities are recommended Viz., GST, Income Tax, Bankers, Lenders etc |
| 65 | All Bankers / Housing Loan Companies can lend only to RERA registered projects. |
| 66 | Lenders insist on RERA registration for project financing |
| 67 | RERA Registration is part of Terms and Condition in Provisional Building Sanction order issued by the planning authorities (BDA, BBMP, DTCP, UDA etc) |
| 68 | All information related to the project is available on the RERA website |
| 69 | All Agent registration, details are available on the RERA website |
| 70 | Project registration, Agent registration application are online only |
| 71 | Filing Complaints by Allottees or promoters are online only |
| 72 | Section 79 of the RERA Act – No civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which the Authority or the adjudicating officer or the Appellate Tribunal is empowered by or under this Act to determine and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act. |
| 73 | RERA Act has inbuilt provision with respect to Appellate Tribunal. |
| 74 | RERA Authority or RERA Adjudicating officer orders are appealable before RERA Appellate Tribunal |
| 75 | RERA Act has defined various terminology to bring the clarity, few important definitions are – Apartment, Carpet Area, Commencement Certificate, Occupancy Certificate, Completion Certificate, Promoter, Real Estate Project |
| 76 | All other statutes refer the definitions as RERA Act e.g., GST, Income Tax, PMLA etc |
| 77 | Penalties for noncompliance of the provisions of RERA are calculated based on estimated cost of the real estate project. Which may extend upto 10 % of the estimated cost of the real estate project. |
| 78 | Chartered accountants or Company Secretaries or Cost Accountants or Legal practitioners are having right to legal representation under Section 56 before Authority, Adjudicating officer or the Appellate Tribunal |
| 79 | RERA Authority are the regulatory authority for the Real Estate Industry (like SEBI, RBI, IRDA, TRAI etc) – appointed by the State Government’s |
| 80 | Central Advisory Council is established as per Section 41 of the RERA Act 2016 |
| 81 | The Central Advisory Council shall consist of representatives of the Ministry of Finance, Ministry of Industry and Commerce, Ministry of Urban Development, Ministry of Consumer Affairs, Ministry of Corporate Affairs, Ministry of Law and Justice, Niti Aayog, National Housing Bank, Housing and Urban Development Corporation, five representatives of State Governments to be selected by rotation, five representatives of the Real Estate Regulatory Authorities to be selected by rotation, and any other Central Government department as notified. |
| 82 | Model Form of Allotment Letter of the apartment / plot are notified by the RERA |
| 83 | Section 43(5) of the RERA Act 2016 mandates the deposit of minimum of 30 % of the penalty for appealing the order the RERA Authority before Appellate Tribunal (1st Appeal) |
| 84 | Section 43(5) of the RERA Act 2016 mandates the promoter to deposit of 100 % of the amount to be paid to the allottee including interest and compensation imposed on the promoter by RERA Authority or Adjudicating officer by way of direction or decision or order to prefer the appeal before Appellate Tribunal (1st Appeal) |
| 85 | 2nd Appeal is before the High Court |
| 86 | Penalties are applicable to Real Estate Agents also non-complying the orders of the Authority or Appellate Tribunal – section 65 & 66 |
| 87 | Penalties may be levied on Allottees also for non-complying the orders of the Authority or Appellate Tribunal – Section 67 & 68 |
| 88 | Section 88 of the RERA Act – Application of other laws not barred – The provisions of this Act shall be in addition to, and not in derogation of, the provisions of any other law for the time being in force |
| 89 | Section 89 of the RERA Act to have overriding effect – The provisions of this Act shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force. |
| 90 | Sale of apartment or mention of the sale price is based on Carpet Area (vis a vis practice of saleable area, super built-up area etc) |
| 91 | Allottees in the project are having duties to perform as per section 19 of the Act viz., timely payment of installments, participation in formation of association, sale deed registration, taking the possession of the apartment or plot. |
| 92 | Conveyance deed or sale deed of apartment or common areas is only after obtaining the occupancy certificate (with in 3 months from the date of receipt of occupancy certificate) – Section 17 |
| 93 | The promoter shall handover the necessary documents and plans, including common areas, to the association of the allottees or the competent authority, as the case may be, within thirty days after obtaining the [completion] certificate – Section 17 |
The Author CA.Vinay Thyagaraj is partner at M/s.Venu & Vinay, Chartered Accountants, Bengaluru, he can write to vinay@vnv.ca for any clarifications.
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Though the RERA was supposed to protect the interest of the Buyer it’s seldom done. The delay in hearings of RERA complaints has waterdown the Provision of the Act. The developer is not affected in any manner whereas the complainant has to wait for years for the hearing to come
In Mumbai it’s almost 4-5 years for a complaint to be resolved with again appeal against the Order available to the Developer.
The developer is not affected neither his project gets stalled and if not mistaken there are ample lawyers at the roll of Developer who can delay hearings.
Good compilation