Real Estate Regulation and Development Act (RERA) of 2016 was implemented from May 1, 2017, onwards. According to the Act, each state and union territory will have a Regulatory Authority (RA) which will form the rules and regulations according to the act.
But the truth is far from what the government is projecting it to be. The Housing Ministry in its press release said, for the first time 76,000 companies engaged in building and construction activities across the country will become accountable for quality and delivery.
The truth is states like Assam, Chhattisgarh, Jharkhand, Punjab, Haryana, Tripura, Karnataka, West Bengal, Telangana and Tamil Nadu have missed the deadline for notifying the final rules, which only stretch the loopholes in the Act furthermore.
According to a report by Firstpost, the RERA act is not about celebrations and expectations and there are quite a few myths around it that need to be busted.
RERA will bring relief to over 1 lakh home buyers stuck in severely delayed projects across India?
According to Firstpost, it won’t change much. ‘Several state RERAs have made it pretty kosher for ongoing projects to escape the net. The Gujarat government may altogether exclude all ongoing projects. There’s enough talk that Gujarat is likely to cover only those projects under the ambit of RERA which have been launched on or after 1st November 2016’.
In Maharashtra, Occupation Certificate (OC) and Completion Certificate are interchangeable. This is a cause to worry about and gives a chance to exclude the incomplete projects on the basis of OC.
In UP if a Completion Certificate has been applied for, and sale/lease deeds of 60 percent of the apartments/ houses/ plots have been executed, the builder is out of RERA’s ambit.
Is there hope for buyers stuck for years in projects like Amrapali, Jaypee & Unitech in NCR, DreamzGK in Bangalore, Aliens Group in Hyderabad? Maybe not. These builders have already taken care of the money and there is very little a regulator can do and that is it can get the developer arrested and not get the money back.
In cases like these, the state regulatory body must step in and form the laws. They need to understand the cases to the detail and also understand the financial side of the whole project. Look into the bankruptcy laws also must kick in, when the developers do not have the money needed to build the projects. The half-completed projects and the lands should be auctioned and the money should be equally distributed among the buyers. If the land is not successfully auctioned, the government must step to complete the half completed projects.
Home buyers are protected in new projects launched post 1st May 2017?
Several clauses under rule 3 of the Maharashtra RERA dilute the term “sanctioned plan”. Maharashtra rules mention only a proposed plan. They further allow developers to get away with disclosing at the time of registration if the sanctioned FSI (Floor Space Index) is different from the proposed FSI. This directly violates the intent of the Central RERA, which specifically does not allow builders to change the act.
In Maharashtra rules, the authority also has the power to decide which documents go on the website and which don’t.
In Gujarat, RERA rules seem incomplete. No rules have been framed prescribing even the basics like forms, documents and procedures required for registration of real estate projects.
Besides these myths according to another report by Firstpost, the Fight for RERA, a homebuyers’ group says that the Maharashtra government has diluted the Act to favour builders thus defeating the central government’s aim of making it a pro-buyers’ Act.
Well, it is quite an open secret that builders provide big money to the politicians during elections to run their campaign. So there is no way that the builder will be sent to jail. So basically the RERA act may talk about making buyer the king, but in reality, the buyer is still at the mercy of builders and the politicians too.
