RERA (Real Estate Regulatory Authority) bill, 2016, become an Act on may 1, kick starting the process of making rules and putting in place institutional infrastructure to protect the interests of buyers in India. Whereas acknowledging that the act is a positive development, property experts said the new rules should address issues faced by developers in getting sanctions and approvals in timely manner. The key to providing succour to homebuyers will be the setting up of Real Estate Regulatory Authorities, which will require all the projects to be registered, and the development of Appellate Tribunals to adjudicate disputes. According to section 20 of the act, state governments have to institute the operational authorities within one year of the law coming into force. These authorities will come to a decision on the complaints of buyers and developers within 60 days.
The act seeks to protect the rights of home buyers, mandates registration of projects, counting those that have not got completion or occupancy certificates. Registration will need builders to set aside 50% of the finances collected from home buyers pay interest in case of delays. Any officer or the secretary of the department handling with housing can be appointed as the interim regulatory authority. Once the regulator is set up, they will get three months to formulate regulations regarding their functioning. Real Estate Appellate Tribunals require to be shaped within a year-by April 30, 2017.
These fast-track tribunals will decide on disagreements over orders of the regulators within 60 days. A committee chaired by the secretary of the housing ministry has started work on formulation of model rules so that states and UTs can frame their rules quickly, besides ensuring uniformity all across the India. The ministry will also come out with model regulations for the regulatory authorities. The lingering sections of the act that have to be notified relate to aspects such as the functions and duties of promoters, duties and rights of allottees, previous registration of real estate projects with the regulatory authorities, improvement of interest on penalties, offences, enforcement of orders, penalties and adjudication. Considering that there 12 months left for the operational authorities to be set up by the states, builders are expected to fast-track work to avoid the stringent requirements of the RERA.