Frequently Asked Questions Regarding RERA

1. What is RERA, and what is its scope?

RERA stands for Real Estate (Regulation and Development) Act, 2016. It is an act passed by the Indian Parliament to regulate and promote the real estate sector in India. The Act extends to the whole of India except for the State of Jammu and Kashmir.

2. What is the main objective of RERA?

RERA primarily aims to protect the interests of homebuyers. It mandates registration of real estate projects with a regulatory authority and promotes transparency in marketing, selling, and purchasing real estate. It also aims to establish an adjudicating mechanism for speedy dispute redressal between stakeholders.

3. What projects need to be registered under RERA?

Any real estate project, whether for residential or commercial use, where the area of land proposed to be developed exceeds 500 square meters or the number of apartments proposed to be developed exceeds eight, including all phases, needs to be registered with RERA. This applies to plots, apartments, and buildings. However, the appropriate Government may reduce the threshold for exemption.

4. Are there any exemptions from registration under RERA?

Yes, there are some exceptions:

• Projects where the area of land to be developed does not exceed 500 square meters, or the number of apartments to be developed does not exceed eight.
• Projects that were completed before the commencement of RERA, and a completion certificate has already been issued.
• Projects that involve only renovation, repair, or redevelopment, without any new marketing, selling, or allotment of units.

5. What is the process of registering a project under RERA?

The promoter of a real estate project has to submit an application to the Authority for registration. This application should be in the form prescribed by the rules made under the Act. The promoter also has to submit the prescribed fee along with the application. The Authority may specify the form, manner, and time for submitting the application through regulations.

6. What documents are required to be submitted along with the application for registration?

The promoter needs to submit several documents along with the application, some of which are:

• Details of the promoter and their enterprise.
• Details of past projects launched by the promoter in the preceding five years.
• Authenticated copies of approvals and commencement certificates from relevant authorities.
• Sanctioned plan, layout plan, specifications, and proposed facilities.
• Proforma of allotment letter, agreement for sale, and conveyance deed.
• Declaration stating legal title of the land, time period for completion, and other details as prescribed.

7. How does RERA ensure financial security in a project?

To prevent financial mismanagement and ensure funds are used for the intended project, RERA mandates that:

• 70% of the total amounts received from allottees for a particular project should be deposited in a separate bank account maintained in a scheduled bank.
• Funds from this account can only be withdrawn to cover the cost of construction and land cost for that specific project.
• Withdrawals should be proportionate to the percentage of project completion, certified by an engineer, an architect, and a chartered accountant in practice.

8. What are the functions and responsibilities of the promoter under RERA?

The promoter has numerous responsibilities:

• Create and regularly update a dedicated webpage on the RERA website with project details.
• Mention the RERA registration number in all advertisements and promotional materials.
• Provide allottees access to sanctioned plans, layout plans, and specifications.
• Obtain completion and occupancy certificates from relevant authorities.
• Execute a registered conveyance deed in favor of the allottee upon completion.
• Pay all dues and charges related to the project before handing over possession to allottees.
• Not transfer majority rights and liabilities without consent from allottees and RERA.

9. What are the remedies available to the allottee in case of a breach of contract by the promoter?

If the promoter fails to meet their obligations, the allottee can:

• Seek a refund of the amount paid with interest, along with compensation for the delay.
• Receive compensation for any loss due to defective title of land.
• File a complaint with RERA or the adjudicating officer for any violation of the Act.

10. What penalties can be levied on promoters for non-compliance with RERA?

RERA has provisions for imposing penalties on promoters for various violations. This can include:

• Penalty up to 10% of the project’s estimated cost for not registering with RERA.
• Imprisonment up to 3 years and/or a fine up to 10% of the project cost for continued violation of the Act.
• Penalty up to 5% of the estimated project cost for providing false information.
• Daily penalties for non-compliance with RERA orders.