Introduction
The Real Estate (Regulation and Development) Act, 2016 (RERA) was introduced in India, with the objective to safeguard the interest of home buyers and to regulate the real estate market.
Project Registration Requirement
With the introduction of RERA in the state of Maharashtra, a specified project is required to be registered with the regulatory authority. According to Section 3 of RERA 2016, following are the eligibility requirements to get the project registered:
a. Where the area of land proposed to be developed exceed five hundred square meters OR the number of apartments proposed to be developed exceed eight inclusive of all phases.
b. Where the promoter has not received a completion certificate for a real estate project prior to commencement of this Act.
c. For the purpose of renovation or repair or re-development which involve marketing, advertising, selling or new allotment of any apartment, plot or building under the real estate project.
Limitations if the Project is not Registered
The promoter cannot advertise, market, book, sell or offer for sale, or invite persons to purchase in any manner any plot, apartment or building, in any real estate project.
Conclusion
- Mandatory – A promoter is required to get his project registered only when the eligibility requirements are fulfilled and intends to advertise, sell and accept advance from buyers, before the receipt of completion certificate.
- Not Applicable – A promoter is not required to get his project registered where the eligibility requirements are not fulfilled. The promoter can advertise, sell and accept advance from buyers.
- Not Required – A project which fulfills registration eligibility requirements, but the promoter does not intend to advertise, sell and accept advance from buyers, before the receipt of the completion certificate. Under this situation, the promoter will be constructing project out of his own funds or through borrowings.
- Opinion – As the objective of RERA is to safeguard home buyers, in this case the promoter is constructing project with his own funds without advertising and accepting advance. After receiving completion certificate from the relevant authority, the project is totally completed, and the home buyer is buying a ready-made home. The homebuyer is totally aware of the home he is buying, and which can be occupied immediately.
Disclaimer
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Post By:
CA Aditya S. Patil
Partner | Real Estate Advisory