The Real Estate (Regulation and Development)
Bill, 2013 provides for specific provisions towards promoting transparency and
fair and ethical business practices, relating to transactions, through
disclosure of project details and contractual obligations vis-à-vis the project
and the buyer, which shall promote informed choice for the buyers. Disclosure
of project details shall substantially reduce the power asymmetry prevalent in
real estate transactions
Currently, the real estate and housing sector is
largely unregulated and opaque, with consumers often unable to procure complete
information, or enforce accountability against builders and developers in the
absence of effective regulation. The Bill is expected to ensure greater
accountability towards consumers, and to significantly reduce frauds and
delays. The Bill aims at restoring confidence of the general public in the real
estate sector; by instituting transparency and accountability in real estate and
housing transactions which in turn will enable the sector to access capital and
financial markets essential for its long term growth.
The specific provisions regarding disclosure of
project details are as follows:
Application to Authority:
Sec 4. (1) Every promoter shall make an application to the Authority for
registration of the real estate project in such form, manner, within such time
and accompanied by such fee
as may be specified by the regulations made by
the Authority.
(2) The promoter shall enclose the following
documents along with the application referred to in sub-section (1), namely:—
(a) a brief details of his enterprise including
its name, registered address, type of enterprise (proprietorship, societies,
partnership, companies, competent authority)
and the particulars of registration;
(b) an authenticated copy of the commencement
certificate from the competent authority obtained in accordance with the laws
as may be applicable for the real estate project mentioned in the application,
and where the project is proposed to be developed in phases, an authenticated
copy of the approval and sanction from the competent authority for each of such
phases;
(c) the layout plan of the proposed project or
the phase thereof, and also the layout plan of the whole project as sanctioned
by the competent authority;
(d) the plan of development works to be executed
in the proposed project and the proposed facilities to be provided thereof;
(e) proforma of the agreements proposed to be
signed with the allottees;
(f) the number and the carpet area of apartments
for sale in the project;
(g) the names and addresses of his real estate
agents, if any, for the proposed project;
(h) the names and addresses of the contractors,
architect, structural engineer, if any, and other persons concerned with the
development of the proposed project;
(i) a declaration, supported by an affidavit,
which shall be signed by the promoter or any person authorised by the promoter,
stating,—
(A) that he has a legal title to the land on
which the development is proposed along with a legally valid authentication of
such title if such land is owned by another person;
(B) that the land is free from all encumbrances,
or as the case may be, of the encumbrances on such land including any rights,
title, interest or name of any party in or over such land along with details;
(C) the likely period of time within which he
undertakes to complete the project or phase thereof;
(D) that seventy per cent., or such lesser per
cent. as notified by the appropriate Government, 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 within a
period of fifteen days of its realisation
to cover the cost of construction and shall be
used only for that purpose.
Explanation.— For the purpose of this clause, the term
‘‘scheduled bank’’ means a bank included in the Second Schedule to the Reserve
Bank of India Act, 1934;
(E) that he has furnished such other documents as
may be prescribed by the rules or regulations made under this Act; and
(j) such other information and documents as may
be prescribed.
Function and Duties of Promoter:
Sec 11. (1) The promoter shall, upon receiving his Login Id and password
under clause (a) of sub-section (1) of section 5 or under sub-section (2) of
section 5, as the case may be, create his web page on the website of the
Authority and enter all details of the proposed project as provided under
sub-section (2) of section 4, in all the fields as provided, including —
(a) details of the registration granted by the
Authority;
(b) quarterly up-to-date list of number and
types of apartments or plots, as the case may be, booked;
(c) quarterly up-to-date status of the project;
and
(d) such other information and documents as may
be specified by the regulations made by the Authority.
(2) The advertisement or prospectus issued or
published by the promoter shall mention prominently the website address of the
Authority, wherein all details of the registered project have been entered and
include the registration number obtained from the Authority and such other
matters incidental thereto.
(3) The promoter, upon entering into an
agreement of sale with the allottee shall be responsible to make available to
the allottee, the following information, namely:—
(a) site and 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 water, sanitation and electricity.
(4) The promoter shall—
(a) be responsible to obtain a completion
certificate from the relevant competent authority as per local laws or other
laws for the time being in force and to make it available to the allottees
individually or to the association of allottees, as the case may be;
(b) be responsible for providing and maintaining
the essential services, as may be specified in the service level agreements, on
reasonable charges, till the taking over
of the maintenance of the project by the
association of the allottees;
(c) take steps for the formation of an association
or society or co-operative society, as the case may be, of the allottees, or a
federation of the same, under the laws applicable.
(5) The promoter may cancel the allotment only
in terms of the agreement of sale:
Provided that 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 of sale,
unilateral and without any sufficient cause.
(6) The promoter shall prepare and maintain all
such other details as may be specified, from time to time, by regulations made
by the Authority.
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