New Delhi:The Union Cabinet approves the amendments proposed in the Real Estate (Regulation and Development) Bill, 2013, which is pending in the Rajya Sabha. The Bill is a pioneering initiative to protect the interest of consumers, to promote fair play in real estate transactions and to ensure timely execution of projects. It was introduced in the Rajya Sabha in August 2013, and then referred to a Parliamentary Standing Committee, which had submitted its report in February 2014.
The salient point of the bill are the establishment of one or more ‘Real Estate Regulatory Authority’ in each State/Union Territory (UT) for oversight of real estate transactions.
Developers have to mandatorily register the projects with the Real Estate Regulatory Authority. Real estate agents who intend to sell any plot, apartment or building also have to get themselves registered with the authority.
The proposed initial Bill was applicable for residential real estate. It is now proposed to cover both residential and commercial real estate;
The bill is expected to ensure greater accountability of developers towards consumers and significantly reduce frauds and delays, the government said in a statement.
It also establishes a fast-track dispute resolution mechanism through adjudication and establishment of a Real Estate Appellate Tribunal.
Developers have to mandatorily disclose the details of registered projects like layout plan, plan of development works, land status, and status of statutory approvals.
The bill spells out the duties of developers, including obligations regarding veracity of the advertisement for sale or prospectus, rectification of structural defects and refund of money in cases of default.
Under the bill, allottees or buyers have the right to obtain stage-wise time schedule of project, claim possession as per promoter declaration and get refund with interest and compensation in case of default by the promoter.
Promoters have to compulsorily deposit 50 per cent (or lesser percentage as notified by the authority) of the amounts realised for the real estate project from the allottees in a separate account in a scheduled bank within a period of fifteen days to cover the cost of construction to be used for that purpose. This is aimed at preventing developers from diverting money raised from allottees.
Under the bill, promoters are barred from altering plans, structural designs and specifications of the plot, apartment or building without the consent of two-third allottees after disclosure. However, minor additions or alterations are allowed due to architectural and structural reasons.
