By Kartikay Singh
LLM in International Commercial Law from University of Aberdeen (UK),
registered as an Advocate in Bar Council of India.
It has been quite some years since the RERA was introduced and it is yet to be rolled out across the country. The Real Estate Regulatory Authority bill had been approved by the Parliament in July 2016. The Real Estate Act makes it mandatory for all the commercial and residential real estate where the land is more than 500 square meters, or eight apartments, to register with the Real Estate Regulatory Authority (RERA) for launching the project, in order to maintain transparency in project marketing and execution. For ongoing projects which have not received completion certificate on the date of commencement of the Act, will have to seek registration within three months. Application for registration must be either approved or rejected within the period of thirty days from date of application by RERA. On successful registration, the promoter of the project will be provided with the registration number, login id and a password for the applicants to fill up essential details on the website of RERA. For the failure to register, a penalty of up to 10 percent project cost or 3 years imprisonment may be imposed. Such agents will be issued a single registration number for each State or Union Territory, which must be quoted by the agent in every scale facilitated by him.
In a recent judgment passed by the Supreme Court, the court cancelled the RERA registration of a construction company named Amarpali stating that they did not followed the rules and regulation of the RERA in accordance with law. There have several other judgments passed the court in which strict action has been taken by the judicial authorities for the companies not following the guidelines laid down by RERA. The Supreme Courtís increased focus on the completion of pending projects has been seen as a positive move which is gradually restoring faith in the real estate sector by addressing the concerns raised by the aggrieved property buyers.
RERA has made real sector relatively transparent. For instance, builders can no longer give a false impression of the property size, now it is mandatory for them to quote the reality in all the agreements. Buyers can also see the status of their project- the site plan, units sold, construction stage, possession date etc., on the RERA website. Some builders are trying to manage buyer discontent due to the extension of project deadlines by giving verbal assurances of finishing the project earlier than the date mentioned to RERA. RERA has led to extensions in the possession dates, in several cases by more than five years. Stiff penalty for project delay on builders has led them to extend the possession dates.
The RERA has the potential to address precisely these issues by providing necessary regulatory framework and mechanism. As on date RERA has already become a reality with majority of the states notifying the rules, setting up web- portals, establishing the respective RERA authorities and designating appellate tribunals. Since RERA aims to regulate promoters, allotters and real estate agents, it covers the spread of the various stakeholders involved in the real estate development. However, there has been a lot of talking and debate on certain provisions of RERA and the rules made there under.
The provisions of RERA provide for the appointment of experienced officials at the State RERA authority and tribunals who shall examine issues for each of the projects. In the events that a stakeholder is not satisfied with the order passed by the State RERA authority, the concerned Appellate Tribunal of the state shall examine the appeal of such an order. The appeal from the Appellate Tribunal of RERA lives with the concerned Stateís High Court. Therefore, with the passage of time as more matters are decided in the Appellate Tribunal and precedents are laid down for ensuring project completion at the State level, there shall reach a point of time where only those matters which have previously unresolved and complex matters shall filter through to the next level.
On Marco level, various stakeholders in this sector, including buyers, unanimously agree that RERA is a positive and focused move by the government. However, the careful, equitable and impartial implementation of this unprecedented legislation is critical for its effective enforcement. To conclude if the existing state RERA authorities are empowered further and this legislation is enforced in an unbiased manner, it shall effectively serve as a watchdog to oversee and expatiate the completion of these pending unfinished projects. This may ultimately result in reduced pressure on the government and judicial system to deal with each of the projects individually at a higher level.