RERA (Registration and Revocation)

Introduction

Every time one decides to purchase a plot of land, or a flat or anything that’s related to real estate one hears a term “RERA” or Real Estate Regulation Authority.  When defined in the technical terms RERA is an ‘Act’:

• To establish the Real Estate Regulatory Authority for regulation and promotion of the real estate sector and to ensure sale of plot, apartment or building, as the case may be, or sale of real estate project, in an efficient and transparent manner.
• To protect the interest of consumers in the real estate sector and to establish an adjudicating mechanism for speedy dispute redressal, &
• To establish the Appellate Tribunal to hear appeals from the decisions, directions or orders of the Real Estate Regulatory Authority and the adjudicating officer and for matters connected therewith or incidental thereto.

In the simple terms RERA forms the guidelines by which real estate works that include the registration of the project, how it is to be sold, and promotion of the real estate sector and further to deal with any issue that might arise out of the same. RERA also protects the interest of the consumer by protecting them from falling into the traps of a false deal or transaction. It stands as an authority that supervises the projects so that all the rules are being adhered.
Furthermore, RERA involves a thorough detail of how a Real Estate project is to be registered with the competent authorities and how the registration can also be invoked.
Now Section 2 of RERA Act, 2016 deals with all the definition that a person needs to understand regarding the real estate and the act itself. Among all the definitions, it also defines the parties that are included when dealing with real estate, the promoter and the allotte.
According to Section 2(d), an allottee is a person to whom a plot, apartment or building, as the case may be, has been allotted, sold (whether as freehold or leasehold) or otherwise transferred by the promoter, and includes the person who subsequently acquires the said allotment through sale or transfer.
Section 2(zk) defines the term promoter as “promoter”
(i) a person who constructs or causes to be constructed an independent building or a building consisting of apartments, or converts an existing building or a part thereof into apartments, for the purpose of selling all or some of the apartments to other persons and includes his assignees; or
(ii) a person who develops land into a project, whether or not the person also constructs structures on any of the plots, for the purpose of selling to other persons all or some of the plots in the said project, whether with or without structures thereon; or
(iii) any development authority or any other public body in respect of allottees of— (a) buildings or apartments, as the case may be, constructed by such authority or body on lands owned by them or placed at their disposal by the Government; or (b) plots owned by such authority or body or placed at their disposal by the Government, for the purpose of selling all or some of the apartments or plots; or
(iv) an apex State level co-operative housing finance society and a primary co-operative housing society which constructs apartments or buildings for its Members or in respect of the allottees of such apartments or buildings; or
(v) any other person who acts himself as a builder, coloniser, contractor, developer, estate developer or by any other name or claims to be acting as the holder of a power of attorney from the owner of the land on which the building or apartment is constructed or plot is developed for sale; or (vi) such other person who constructs any building or apartment for sale to the general public
Now prior to selling any project to the allottee the promoter has to get it registered with the regulatory authority as according to the act, promoter is not allowed to advertise, market, book, sell or offer for sale, or invite persons to purchase in any manner any plot, apartment or building, as the case may be, in any real estate project or part of it, in any planning area, without registering the real estate project with the Real Estate Regulatory Authority. (stated u/s 3 of RERA Act)
Registration under the RERA Act:
The process of registration has been defined under Chapter II, Sec. 3-5 of the RERA ACT, 2016.

• The promoter has to file an application to the Authority for registration of the real estate project in such form, manner, within such time and accompanied by such fee as prescribed by the competent authority.
• Furthermore alongside the above application the promoter has to attach certain documents (12 documents to be attached)for the registration that includes -

• a brief details of his enterprise including its name, registered address, type of enterprise (proprietorship, societies, partnership, companies, competent authority), and the particulars of registration, and the names and photographs of the promoter;
• a brief detail of the projects launched by him, in the past five years, whether already completed or being developed, as the case may be, including the current status of the said projects, any delay in its completion, details of cases pending, details of type of land and payments pending;
• an authenticated copy of the approvals and commencement certificate from the competent authority obtained in accordance with the laws as may be applicable for the real estate project mentioned in the application, and where the project is proposed to be developed in phases, an authenticated copy of the approvals and commencement certificate from the competent authority for each of such phases;
• the sanctioned plan, layout plan and specifications of the proposed project or the phase thereof, and the whole project as sanctioned by the competent authority;
• the plan of development works to be executed in the proposed project and the proposed facilities to be provided thereof including fire fighting facilities, drinking water facilities, emergency evacuation services, use of renewable energy;
• the location details of the project, with clear demarcation of land dedicated for the project along with its boundaries including the latitude and longitude of the end points of the project;
• the proforma of the allotment letter, agreement for sale, and the conveyance deed proposed to be signed with the allottees;
• the number, type and the carpet area of apartments for sale in the project along with the area of the exclusive balcony or verandah areas and the exclusive open terrace areas appurtenant with the apartment, if any;
• the number and area of garage for sale in the project;
• the names and addresses of his real estate agents, if any, for the proposed project;
• the names and addresses of the contractors, architect, structural engineer, if any and other persons concerned with the development of the proposed project;
• a declaration, supported by an affidavit, which shall be signed by the promoter or any person authorised by the promoter, stating:—
• that he has a legal title to the land on which the development is proposed along with legally valid documents with authentication of such title, if such land is owned by another person;
• that the land is free from all encumbrances, or as the case may be details of the encumbrances on such land including any rights, title, interest or name of any party in or over such land along with details;
• the time period within which he undertakes to complete the project or phase thereof, as the case may be;
• that seventy per cent. of the amounts realised for the real estate project from the allottees, from time to time, shall be deposited in a separate account to be maintained in a scheduled bank to cover the cost of construction and the land cost and shall be used only for that purpose

Now when the application has been filed by the promoter along with the necessary documents the authority on receipt of the application shall within a period of 30 days would either :

• grant registration subject to the provisions of RERA Act and the rules and regulations made there under which would be valid for a period declared by the promoter (in the documents with the application), and provide a registration number, including a Login Id and password to the applicant for accessing the website of the Authority and to create his web page and to fill therein the details of the proposed project; or
• reject the application for reasons to be recorded in writing, if such application does not conform to the provisions of this Act or the rules or regulations made thereunder: Provided that no application shall be rejected unless the applicant has been given an opportunity of being heard in the matter.

Revocation of Registration
After the promoter is granted with the registration, if he fails to adhere to any guideline which is prescribed under the act, his registration will be revoked on the recommendation of the competent authority.
The revocation shall take place in the below cases, when the promoter :-

• makes default in doing anything required by or under this Act or the rules or the regulations made thereunder;
• violates any of the terms or conditions of the approval given by the competent authority;
• Is involved in any kind of unfair practice or irregularities.

“unfair practice means” a practice which, for the purpose of promoting the sale or development of any real estate project adopts any unfair method or unfair or deceptive practice including any of the following practices, namely:—

• The practice of making any statement, whether in writing or by visible representation which,—
• falsely represents that the services are of a particular standard or grade;
• represents that the promoter has approval or affiliation which such promoter does not have;
• makes a false or misleading representation concerning the services;
•  The promoter permits the publication of any advertisement or prospectus whether in any newspaper or otherwise of services that are not intended to be offered;
• The promoter indulges in any fraudulent practices.

When the registration of the promoter is revoked by the authority he will be debarred from accessing its website in relation to that project and specifies his name in the list of defaulters and display his photograph on its website and also inform the other Real Estate Regulatory Authority in other States and Union territories about such revocation or registration. The bank looking after the account of the project will be directed to freeze the account of the project and the authority will issue further directions as it deems fit in the protection of the interest of the allottees.
Therefore concluding the above facts it is clear that the formation of the RERA Act, 2016 has given power tool in the hands of the authorities to act as a supervisor for the developers in respect of the projects they are getting registered. The RERA Authority must be satisfied that the promoter has made any default in doing anything required by this act or he has violated any of the terms or conditions of the approval given by the authority or the promoter is involved in any kind of unfair practice or irregularities.