Or­der out of chaos at last?

Realty reg­u­la­tor will pro­vide much-needed re­lief to home buy­ers

HT Estates - - Front Page - Van­dana Ram­nani

Ravi Sharma booked a flat three years ago, but when it fi­nally came up for pos­ses­sion, the apart­ment turned out to be much smaller than the promised 2200 sq ft. A col­league of his, who booked another flat in a big project around the same time, is yet to see con­struc­tion be­gin at the site.

Home­buy­ers will be much re­lieved now that the Cen­tre has fi­nalised the draft Real Es­tate (Reg­u­la­tion & De­vel­op­ment) Bill, pend­ing since 2009. It will safe­guard the rights of prop­erty buy­ers and is likely to be in­tro­duced in the win­ter ses­sion of Par­lia­ment af­ter cabi­net ap­proval.

The Bill makes it manda­tory for the de­vel­op­ers to regis­ter them­selves with the real es­tate reg­u­la­tory author­ity to be set up in each state. Jail terms are rec­om­mended for de­vel­op­ers mak­ing false prom­ises. A penalty of 10% of the to­tal project cost could also be slapped on them and li­censes re­voked in ex­treme cases.

Once the Bill is passed, de­vel­op­ers will have to sub­mit the ap­proved lay­out plans, time­lines, costs and the sale agree­ment to the reg­u­la­tor be­fore launch­ing projects. An es­crow fund will be cre­ated where a per­cent­age of the money col­lected from the buy­ers will be parked, to be used only for the spe­cific project.

So, how is the new ver­sion of the bill dif­fer­ent from the ear­lier drafts? The bill is no longer a model bill pre­pared by the cen­tral gov­ern­ment for the state gov­ern­ments to fol­low. It is now ap­pli­ca­ble to the en­tire coun­try and leaves it to the state gov­ern­ments to es­tab­lish a real es­tate reg­u­la­tory author­ity and other rules and pro­ce­dures in due course. “The ap­pel­late tri­bunal pro­vided for within the new ver­sion of the bill, is now at a cen­tral gov­ern­ment level as op­posed to the ear­lier state gov­ern­ment level. This prima fa­cie seems to be a wise move,” says Sachin Sand­hir, man­ag­ing direc­tor, RICS South Asia.

There is also a cor­re­la­tion be­tween the Com­pe­ti­tion Com­mis­sion of In­dia, whereby the bill es­tab­lishes that any dis­putes that fall within the purview of the com­mis­sion will be passed on to them for re­view and, if pos­si­ble, res­o­lu­tion.

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