Penal Interest -: A big relief to buyers as penal charges levied by the promoters on the allottees in case of delay in payment was very high in comparison to the penal charges by the promoter in case of delay in possession.In many cases it was even observed that due to clauses and insertions made in the agreement many times the allottee was not even entitled for any penalty from the builder side in case of delay of possession. But after the RERA The rate of interest now chargeable from the allottee by the promoter, in case of default, shall be equal to the rate of interest which the promoter shall be liable to pay the allottee, in case of default. The interest payable by the promoter to the allottee shall be from the date the promoter received the amount or any part thereof till the date the amount or part thereof and interest thereon is refunded.
"Carpet Area" - Gone are the days when there was no definition and clarity regarding the carpet area & usable area. The promoters used to confuse the buyers and used to take extra money without disclosing the actual usable area .Now as per RERA provision carpet area is well defined and it means the net usable floor area of an apartment, excluding thearea covered by the external walls, areas under services shafts, exclusive balcony or verandah area and exclusive open terrace area, but includes the area covered by the internal partition walls of the apartment.
Registration of projects is now mandatory A buyer should know that now it is mandatory that every project should be registered with RERA first. The promotoer is mandatorily reuired to file an application to the authority to register their projects.The RERA authority shall within the period of 30 days will register the project subject to the provisions of the RERA Act and the rules and regulations made thereunder, and provide a registration number, including a Login Idand password to the applicant for accessing the website of the Authority.The buyer should do the transaction only with the builder and projects which are registered with the RERA authority as well as with the local authority.
Declaration for clear and Valid Title: The builder has to declare to the RERA Auhtority about the valid title of 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 .The land should be 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 promoter shall compensate the allottees in case of any loss caused to him due to defective title of the land, on which the project is being developed or has been developed,in the manner as provided under the Act.
7) Escrow account – Now the builders/promoters cannot divert the funds which was widely done before RERA. As a buyer you can now demand that your money paid towards your dwelling unit should be deposited in the Escrow account which is mandatory to open and maintain by every promoter after the RERA. Also check and verify that the construction work is done in accordance and proportionate with the payment done by you. RERA makes it mandatory that 70% 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.The amounts from this account shall be withdrawn by the promoter only when it is certified by an engineer, an architect and a chartered accountant in practice that the withdrawal is in proportion to the percentage of completion of the project:
Booking amount or token money collected on basis of false Statement and misleading Informations: The promoter is now required to provide correct and genuine informations about the project and in case if any false information or commitment is made and the allottee incurs any loss or any damage by reason of any such false ,misleading and incorrect information’s he/she shall be returned all his investments alongwith the interest at such rate as may be prescribed as per the Act and the Authority.
No Advertisement by the Promoter without registration : No promoter shall 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.
No false and misleading advertisement by the Promoter - If the buyer is affected by such incorrect, false statement contained in the notice, advertisement or prospectus, or the model apartment, plot or building, as the case may be, and due to this if he/she intends to withdraw from the proposed project, he shall be returned his entire investment along with interest at such rate as may be prescribed and the compensation in the manner provided under this Act.
Booking amount should not be more than 10% - After the RERA application a promoter shall not accept a sum more than ten per cent of the cost of the apartment, plot, or building as the case may be, as an advance payment or an application fee from a person without first entering into a written agreement for sale with the buyer andregister the said agreement for sale.
Cancellation by the Promoter : The promoter may cancel the allotment in case of default of payment for 3 consecutive months and only in terms of the agreement for sale. However the allottee may approach the Authority for relief, if he is aggrieved by such cancellation and such cancellation is not in accordance with the terms of the agreement for sale, unilateral and without any sufficient cause. It is recommended that one should check and read the agreement to sell terms and conditions for this before signing it.
Cancellation by the Allotee- Now with the implementation of RERA the buyer can now also withdraw or cancel the booking in case of crisis or valid reasons even if there is no fault of promoter. In such case of cancellation the promoter is entitled to deduct the booking amount or token money and refund the balance amount as per the different State rules and policies.Different States have different versions on this and this matter is yet not well settlled.It is recommended that one should refer the agreement terms and clause for cancellation.
Delay in Possession - If the promoter fails to complete or is unable to give possession of an apartment, plot or building in accordance with the agreement terms and conditions or due to discontinuance of his business as a developer on account of suspension or revocation of the registration under the Act or for any other reason, and if allottee wishes to withdraw from the project without prejudice to any other remedy available ,the promoter on demand by the allottee is liable to return the amount received by him in respect of that apartment, plot, building, as the case may be, with interest at such rate as may be prescribed in this behalf including compensation in the manner as provided under the Act.
Standard format for Agreement to Sale- This was the major root cause for all the disputes happened between buyer and the promoter as the terms and conditions mentioned in the agreement was usually one sided and highly favourable to promoters. Now the RERA has the standard format and the agreement for sale should be in such form as may be prescribed (kindly check your state format) and shall specify the particulars of development of the project including the construction of building and apartments, along with specifications and internal development works and external development works, the dates and the manner by which payments towards the cost of the apartment, plot or building, as the case may be, are to be made by the allottees and the date on which the possession of the apartment, plot or building is to be handed over, the rates of interest payable by the promoter to the allottee and the allottee to the promoter in case of default, and such other particulars, as may be prescribed.
Presentation of documents and information by the Promoter to buyer :- The promoter at the time of the booking and issue of allotment letter shall be responsible to make available to the allottee, the following information, namely:—
(a) sanctioned plans, layout plans, along with specifications, approved by the competent authority, by display at the site or such other place as may be specified by the regulations made by the Authority;
(b) the stage wise time schedule of completion of the project, including the provisions for civic infrastructure like water, sanitation and electricity.
Structural Defect : - In case of any structural defect or any other defect in workmanship, quality or provisionof services or any other obligations of the promoter as per the agreement for sale relating to such development is brought to the notice of the promoter within a period of five years by the allottee from the date of handing over possession, it shall be the duty of the promoter to rectify such defects without further charge, within thirty days, and in the event of promoter's failure to rectify such defects within such time, the aggrieved allottees shall be entitled toreceive appropriate compensation in the manner as provided under this Act.