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RERA Registration in India
The real estate sector saw an unexpected growth in the apartments, buildings, and plots sales. To keep a check on the builders and to provide transparent and fair sales for the buyers, the Government of India launched the RERA or the Real Estate Regulatory Authority. With buyers facing problems on timely delivery of the property from the builders, the government on receiving many complaints constituted a 92 section Act in the parliament during the May session of 2016. Out of 92, 59 sections were hinted and were passed on 10th March by the upper house i.e., Rajya sabha followed by the Lok sabha /lower house on the 15th of March.
The RERA act came into active force with 52 sections on 1st May 2019, and the remaining section also got notified on 1st May 2017. It is formally termed as the Real Estate (Regulations & Development) Act 2016. As of now, 28 states and UTs are working in compliance with the Act with the others to fall in line soon. In the states who comply with the Act, all the real estate builders,developers are required to get registered under the RERA act and present all information to the authority as per requirements.
The Registration Process of RERA
From the moment of its implementation, the RERA Act requires all residential and commercial projects that have yet to be completed in order to comply with the Act
- The land is more than 500 Mtsq.
- There are 8 apartments or more.
For the ongoing projects started before the Rera Act began, and that has not yet obtained the completion certificate, the time period given is 3 months.
Documents Required for RERA
The government of India has set a standard procedure for all agents, promoters, and builders to get themselves registered with the RERA. The SOP requires the following documentation.
01. Registration of Project
- If the promoter is a single person, then all basic information i.e., name, personal contact details, address proof, along with a photograph.
- If the promoter is an enterprise, then all details of the directors, partners, or any other authorized personnel are needed, which include their names, addresses, and place in the company.
- Certificate of completion if it is an ongoing project
- PAN and GST details
- Adhaar details of all the board
- ITR for the last 3 yrs
- Audit details and balance sheets
- Collaboration documentation if applicable
- In case of commercial project commercialization certification my respective authority
- Details of location
- Design details of the entire covered and open area as per the rules set by the government.
- Form – B along with an affidavit
02. Registration of An Agent
- Details of personal information like Name, personal contact details, address proof along with photographs of all the partners or directors as applicable.
- PAN details
- Adhaar details
The registration is made by initially addressing a board meeting and forming a separate bank account to keep track of the cost of the project. Once the NOC & licenses are obtained from the respective authorities, the RERA application needs to be filled with the state authority. The certification of registration with RERA is obtained from all projects in the FORM-C SECTION 5. The fee differs state-wise and needs to be calculated separately. Noncompliance with RERA registrations leads to hefty penalties, which may cost up to 10% of the total estimated cost of the projector, even cancelation of projects in severe cases by authorities. It may also lead to imprisonment.
Benefits of RERA
The primary beneficiaries of the RERA Act are the buyers. The real estate agent/builders/promoters need to document and present details regarding the project to the buyer. The builder is not authorized to charge for the super area; therefore, the buyer pays only for the covered/carpeted area saving the cost to the buyer.
The money taken from the buyer for a particular project has to be deposited in the registered bank account in the RERA registration form. It has to be used by the builder in that specific project. This prevents delays and incorrect completion. Therefore the buyer gets what he pays for, and the project is finished on schedule as well.
In earlier times, it was commonly seen that developers were making fake promises to buyers. Builders were taking heavy amounts as investments in a project and without completion were using that money in diversified projects. The buyer was at the losing end; hence RERA was implemented. The benefits under this are
- Transparent information on projects
- Proper finishing and if any issues occur in the structure within 5 years the developer needs to take care of
- Proper clearance from all authorities, therefore, no hassle in the future
- The booking amount has been reduced to 10%
Frequently Asked Questions ?
Any project which has the land more than 500 Mt sq. or there are 8 or more apartments needs to comply with RERA registration.
Any project or Initiative with completion certificate of the authority before the implementation of the RERA Act is exempted. Even if there is a simple renovation that does not require sales, promotion, or advertisement of the current real estate property is exempted from the registration.
The RERA act applies to both commercial and residential projects.
Yes, RERA cares about both the buyer and the developer. If the security is provided to the buyer, the developer also gets benefits as
- Government has issued clear orders of possession by the buyer within a maximum of 2 months from completion
- Timely payment is mandatory; otherwise, the buyer will also face the penalty.
- Due to buyer protection, the faith in the industry increases, and so invests.
The RERA authority of the state government grants registration to all real estate projects, which holds validity until the project completion.
Once the State authorities have granted registration to a Builder Project under RERA and the developer is willing to quit the project midway, he/she can do so only by getting documented approval of a total of 2/3 of buyers who have invested in the project.
Heavy penalties may be imposed if the timelines are not met. Therefore the buyers are the primary beneficiaries.
If the registration is not taken care of by real estate developers, brokers, and promoters, then there are hefty penalties which might sum up to a total of 10% of the total project cost or even custody of up to 3 years or even both.
Only in case of natural disasters does the Rera authority give an extension to the developer. The maximum extension given is up to 1 yr Only.
The simple SOP has been laid to procure RERA registration
- Present details of the developer, authorized signatories, and project heads
- Details for projects filling for registration
- Developmental plan in detail
- Details of past RERA projects, if any.
- Bank registration details specific for the project
- Fill in the form and pay the fee with all the documents present physically.
- The government provides a RERA registration number which issued as a unique ID in all sales deeds
- Get the printout of the submitted RERA form and acknowledgment slips
- Noncompliance of transparency with the buyer will lead to disqualification.
The fee is listed on the website of each state-specific RERA website; hence it needs to be checked on the portal of the state where the project belongs.
Yes, a buyer can register a complaint against a registered developer to the RERA authority. He/she has to provide details to the authority file in the fee, and his/her complaints will be recorded and taken care of.