Understanding the Real Estate Regulatory Authority RERA Act

Introduction to the Real Estate Regulatory Authority (RERA)

The Real Estate (Regulation and Development) Act, 2016 marks a watershed moment in Indian real estate regulation. Commonly known as RERA, this Act was enacted to protect home buyers and promote the real estate sector by establishing a regulatory authority at the state level. RERA aims to bring transparency, accountability, and efficiency to the real estate market, which had long been plagued by delays, unfair practices, and lack of standardization.

RERA applies to all residential and commercial real estate projects where the land area exceeds 500 square meters or the number of apartments exceeds eight. Promoters are required to register their projects with the state's Real Estate Regulatory Authority before advertising or selling any units. Non-compliance attracts significant penalties, including imprisonment in severe cases.

The Act also establishes the Real Estate Appellate Tribunal to hear appeals against RERA orders, ensuring a robust dispute resolution mechanism. At Vidhi Legal Services, we help both developers and home buyers navigate the RERA framework effectively.

Key Provisions and Benefits for Home Buyers

RERA provides numerous protections for home buyers. Promoters must provide complete project details during registration, including layout plans, specifications of building materials, timeline for completion, and details of all approvals obtained. These details are uploaded to the state RERA website, making them accessible to anyone.

The Act mandates that promoters deposit 70% of the amounts collected from buyers into a separate escrow account. This amount can only be used for construction of that specific project, preventing diversion of funds to other projects. This provision has been a game-changer in ensuring project completion.

Buyers also have the right to obtain information about the project's progress, including quarterly updates on the status of construction. If the promoter fails to complete the project within the committed timeline, buyers can seek compensation or withdraw from the project with full refund plus interest.

RERA Registration Process for Developers

Developers must apply for RERA registration by submitting Form A along with detailed project information, including the project name, location, layout plan, specifications, timeline, approvals from local authorities, and the promoter's details. The application must be accompanied by the requisite fee, which varies by state.

The Regulatory Authority reviews the application and, if satisfied, issues a registration number and certificate within 30 days. The registration is valid for the duration of the project as specified in the application. Developers must display the RERA registration number in all project advertisements and marketing materials.

Failure to register a project under RERA attracts a penalty of up to 10% of the project cost, and continuing non-compliance can lead to imprisonment of up to three years. At Vidhi Legal Services, we assist developers in preparing and submitting their RERA applications accurately and on time.

Filing a Complaint with RERA

Home buyers can file complaints with RERA against promoters for various grievances, including project delays, changes in building plans without consent, defective construction, failure to obtain necessary approvals, and misleading advertisements. The complaint can be filed online through the state RERA portal or physically at the RERA office.

The complaint must include details of the project, the specific grievance, supporting documents, and the relief sought. RERA is required to adjudicate complaints within 60 days, making it a much faster forum compared to traditional civil courts. Appeals against RERA orders lie with the Appellate Tribunal and ultimately the High Court.

Our team at Vidhi Legal Services has extensive experience in representing clients before RERA authorities across India. We help draft compelling complaints, gather evidence, and argue cases effectively to ensure our clients receive the justice they deserve.

Frequently Asked Questions