RERA (Real Estate Regulatory Act) - Will Haryana Implement The Right, Earnest, Rare, Approach?

The much exulted RERA (Real Estate Regulatory Act) will soon be implemented in Haryana from 1^st May, 2017. The residents are expecting a lot from RERA and hoping that the attempt to safeguard the legislation by the Centre remains strong. There has been news about reported watering down attempts of the RERA by the States. However, in January 2017, the Centre had vehemently refuted it and warned against any modifications to the basic guidelines governing the Act.

In the recent years, we have witnessed legal battles between consumers and builders over the inconsistencies prevalent in the real estate realm. RERA had instilled the much needed hope amongst the consumers, administrators and real estate players. However, since May 2016 there has been a gradual progress when it comes to its actual applicability. Few States had attempted to dilute it by careful tweaking in favour of the builders, thereby contravening the purpose of ensuring transparency in real estate dealings.

Haryana Government has announced the implementation of RERA from 1^st May, 2017 and there are widespread speculations about its viability. Apprehensive about its adherence to the legislation laid down by the Centre, the consumers are hoping that the RERA addresses people’s prolonged woes. Corrective measures have been recommended to States who have attempted to dilute the effect of RERA. Since the Parliament passed the Bill, senior bureaucrats at the State level have been sufficiently warned about any kind of modifications to RERA. However, there is skepticism about following the Act in its original form.

The CM has committed to establishing the real estate regulatory authority, which is slated to provide some relief to home buyers and while we are still awaiting the final timelines for it, we hope that the authority remains unprejudiced.

Some of the highlights of the Act include:

• It establishes the State Real Estate Regulatory Authority for that particular state as the government body to be approached for redressal of grievances against any builder. This will happen once every state ratifies this Act and establishes a state authority on the lines set up in the law.

• This law vests authority on the real estate regulator to govern both residential and commercial real estate transactions.

• This Act mandates the developer to park 70% of the project funds in a dedicated bank account. This will ensure that developers are not able to invest in numerous new projects with the proceeds of the booking money for one project, thus delaying completion and handover to consumer

• This law makes it mandatory for developers to post all information on issues such as project plan, layout, Government approvals, land title status, sub contractors to the project, schedule for completion with the State Real Estate Regulatory Authority (RERA) and then in effect pass this information on to the consumers.

• The current practice of selling on the basis of ambiguous super built-up area for a real estate project will come to a stop as this law makes it illegal. Carpet area has been clearly defined in the law.

• Currently, if a project is delayed, then the developer does not suffer in any way. Now, the law ensures that any delay in project completion will make the developer liable to pay the same interest as the EMI being paid by the consumer to the bank back to the consumer.

• The maximum jail term for a developer who violates the order of the appellate tribunal of the RERA is three years with or without a fine.

• The buyer can contact the developer in writing within one year of taking possession to demand after sales service if any deficiency in the project is noticed.

• The developer cannot make any changes to the plan that had been sold without the written consent of the buyer. This puts an end to the common and unpopular practice by developers to increase the cost of projects.

• Lastly, every project measuring more than 500 square metres or more than eight apartments will have to be registered with the RERA.

• Appellate Tribunals will now be required to adjudicate cases in 60 days instead of no time limit earlier.

RERA will waive off all the earlier injustice borne by hapless buyers in the hands of developers. Timely completion of projects forms a major component of the Act. Haryana being a choice destination for developing townships faces a lot of brunt till the final stage of possessing the property. RERA will offer much awaited relief to the consumers, subject to its proper adherence and in continuum with the Centre’s provisions laid down in the Act.