Real Estate heading towards a makeove

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August 26,2016
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The Indian Real Estate sector is headed towards a makeover as the Cabinet cleared major amendments to the Real Estate (Regulation & Development) Bill (RERD) pending in the Rajya Sabha in the ongoing Winter Session of Parliament. The Bill will now be taken up for consideration and passing by the Parliament. The RERD Bill intends to protect consumer interest and promote unprejudiced real estate transactions. It mandates disclosure by promoters to consumers through registration of real estate projects as well as real estate agents with a regulator, consequently establishing the Real Estate Regulatory Authority (RERA). Some important features of the Bill which are sure to transform the real estate landscape of India re: 1. Both commercial and residential real estate is covered under the Bill. 2.Brokers and agents have been included in its purview and will be rendered punishable in case of non-compliance with the RERA’s ruling. 3.All under-construction projects will have to be compulsorily registered within three months of setting up of the regulator, and developer cannot make changes to original plans or the structural design unless he gets the consent of two third of the customers. Failure to register a project will cause the developer to attract a penalty and an additional penalty and/or a prison term in case of continued non-compliance. 4.States/UTs have to set up a ‘Real Estate Regulatory Authority’ to regulate real estate transactions in their State within one year of the Bill’s enactment while also setting up a web-based online registration facility within a further period of one year from setting up of the bodies. 5.Mandates disclosure of all registered projects, including details of the promoter, project, layout plan, land status, approvals, agreements along with details of real estate agents, contractors, architect, structural engineer etc. 6.Deposit of specified amount in a separate bank account to cover the construction cost of the project for timely completion of the project. 7.Civil courts jurisdiction prohibited from taking up matters defined in Bill, however, consumer court allowed to hear real estate matters.

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