RERA or Real Estate Regulatory Authority is an act introduced to regulate and promote the real estate sector in India. This Act ensures the sale of plot, apartment or building without any issue and in a transparent manner. The main aim of RERA Project Registration is to protect the consumer’s interest in Real estate. The proposed bill for regulation and promotion of the real estate sector was enacted by the Parliament in May 2016 and it came into Act with all its 92 sections from 1st May 2017 throughout India. Till now, about 14 states and union territories including Uttar Pradesh, Gujarat, Odisha, Andhra Pradesh, Tamil Nadu, Bihar, Madhya Pradesh and Maharashtra have informed their rules with RERA formally and the others are required to follow lawsuit.
The main objective to implement of RERA is to bring relief to the land and home buyers, as per the RERA suit, builders are accountable for the timely delivery of the land or home or projects and to protect the consumers or buyers from dupery sellers. And also RERA helps the developers in such a way that it gains increased confidence among the consumers and all the dealing related to the real estate will go smoothly in a regulated environment. Actually, It is mandatory for the real estate developers to obtain the various types of approvals from different government agencies prior to launching a building project and have to display or disclose all the needed information on their website as the appropriate state RERA regulatory authority will set up.
Real estate agents who have registered under RERA Act are provided with a unique registration number by the regulator which the real estate agents have to mention in every project or property sale. This type of procedure will help in eradicating the possibility of confusing the buyer. The RERA authority has an extensive range of powers to enforce penalties and imprisonment of real estate agents in case of violation of the Rules and Regulations.
‘The requirements to register a Project under RERA – How the limit of more than 8 apartments or more than 500 Sq. mtrs. is to be seen?
Sec.3(2) of RERA gives the conditions in which the registration is not required for any project. It reads as under:
(2) Notwithstanding anything contained in sub-section (1), no registration of the real estate project shall be required
(a) Where the area of land proposed to be developed does not exceed five hundred square meters or the number of apartments proposed to be developed does not exceed eight units inclusive of all phases’
The rules and regulations for receiving the RERA registration for a real estate project are provided in Section 3 of the Tamil Nadu RERA Rules. For Instance:
- If the land area to be developed is 400 Sq. mtrs. and No. of apartments is 9 then RERA registration is required
- If the land area to be developed is 600 Sq. mtrs. and the count of apartments is 7 then RERA registration is required
- If the land area to be developed is 600 Sq. mtrs. And the count of apartments is 9 then RERA registration is required.
As per the RERA Act, all real estate projects in and around India must be filed under RERA for the promoter to market, advertise or sell any of the apartment or building or plot. But there are few exceptions; RERA Registration is not required for the following types of real estate projects:
- If the area of land does not exceed 500 square meters.
- The number of apartments does not exceed 8 flats inclusive of all phases.
- If the promoter got the completion certificate for his/her real estate project before the commencement of RERA Act.
- Repair or renovation or re-development of an existing building or the real estate project which does not need any type of marketing, promotion, advertising to sell of any apartment or plot.
The RERA Project Registration process
It is mandatory that all residential and commercial real estate projects apart from above exemptions have to be registered under RERA by submitting the following documents along with the payable fees.
Documents required for registration under RERA are:
- PAN Card of the builder
- Income Tax Returns of the last 3 years and the balance sheet of the builder
- The builder must clarify the apartment such as carpet area, number of floors, parking space and so on.
- Proof of declaration by the builder of holding the legal title of the land
- Encumbrance certificate for the land (rights, title, mortgage)
- The consent letter from the actual owner of the land with documents will be required ( if the land is not owned by the builder)
- Details like location, sanctioned plan, layout plan and so on of the developing project
- Ownership documents such as proforma of allotment letter, Sales agreement
- Information of the persons or employees involved in the project such as Engineers, Architects and others
As per the RERA rules, the following stepwise procedure must be followed to obtain RERA registration for a project.
Step 1: Submit RERA Application to Register the Project under RERA
The builder or any authorized person of the developing project has to submit the RERA application for registration of project in Form A and Form B accompanied with the list of above mentioned required documents.
Step 2: Paying the prescribed Fee for RERA Registration
The builder or the promoter must submit the RERA registration fee along with the RERA application. The registration fee of RERA Registration is calculated like mentioned below
For Layouts, sub-divisions and site approvals – Rs.5/- per square meter of land area excluding EWS plots (Roads and OSR excluded);
For Residential buildings –
Rs.10/- per square meter of FSI area for a residential project in which dwelling unit size is less than 60 square meter;
Rs.20/- per square meter of FSI area for other residential projects ;
For Commercial buildings – Rs.50/- per square meter of FSI area;
For Any other projects – Rs.25/- per square meter of FSI area;
(as mentioned at http://www.tnrera.in/reg_promoter_tamilnadu.php)
Step 3: Receiving the RERA Registration Certificate
If all the required documents submitted are satisfactory and the authorized Officer will grant RERA Project registration . After receiving the RERA registration, the promoter of the project can start their project promotions through advertisements, marketing and sell the project to the public.
Here are the benefits of RERA for Buyers
- Project under RERA registration have to disclose or display all the details and also have to update about the project regularly on the website of the authority
- The buyer has to pay only for the carpet area, ie the area within walls and the builder cannot charge the buyers for the super built-up area such as lift, stairs, balcony, and lobby
- Timely completion of projects is confirmed as 70% of the money collected from the buyers has to be shifted in a separate bank account and it can be utilized only for the construction purpose of the project
- The developer has to pay an interest of 2% above SBI’s Marginal cost of loaning rate to the customer if there is any delay in the completion of the project.
- Any defect in the project or building, then the whole responsibility is on the builder for a period of first 5 years
- Any disputes or issues with the customers need to be settled down within 120 days.