Status as on- 18/10/2019
RERA has acted as a straw for the sinking ship. While the real estate market was at its peak and booming, on one hand, the weaker of the two parties (i.e. innocent homebuyers) were suffering at the hands of those in the dominant position. RERA was enacted with the key objective of protecting the interests of the buyers, saving them from being exploited at the hands of builders/ developers and promoters along with ensuring a fair and transparent process for the functioning of the real estate sector. The act encompasses provisions that are separately applicable to builders, promoters, developers, and agents associated with real estate projects. After RERA was enacted, states in the country were given a year to form their policies & rules order to comply with the central legislation. States were directed to establish a regulatory authority, whose work was to overlook the registration process and ensure compliance of the policies of the state.
KARNATAKA RERA BUILDER COMPLIANCE
The state of Karnataka in compliance with the Real Estate (Regulation and development) act of 2016 [RE (R&D)] has officially notified its RERA rules on 10th July 2017. According to these rules below mentioned are the Karnataka RERA compliances for builders of a real estate project:
- QUARTERLY COMPLIANCE: To keep a check on the ongoing real estate construction process the government of Karnataka launched the scheme of quarterly compliance to be followed by builders and developers. Under this scheme, developers are required to present various documents speculating the completion status of the projects they are associated with every quarter. The process of quarterly compliance is separate for plots and apartments, therefore it depends upon the type of project a builder is associated with.
- ESCROW DEPOSIT: As per the RE(R&D) Act,2016 a promoter is required to create a compulsory deposit of 70 percent or such other amount as notified by a particular state of the deposits made by the buyers in a separate account which is to be used only for completing the real estate project.
- DISCLOSURE OF RELEVANT INFORMATION: A promoter is under an obligation to comply with the provisions of public disclosure stated under the act of 2016, which requires true and full disclosure of information relating the project, adherence to the specific standards as stated by appropriate authorities, the information advertised in the prospectus, etc.
- MANDATORY REGISTRATION: As per the Karnataka real estate rules a promoter or builder cannot initiate marketing, advertising, inviting of offers or make a sale of any of the parts of the project without registering it with the appropriate authority.
- MISCELLANEOUS: Where a builder is required to create and maintain an official website of the project and update it regularly. Also, a builder has to adopt the given process for refunds and cancellations.
The above compliance were set in place to act as a watchdog for the real estate sector in India. All these compliance are only a means towards the end i.e. to achieve the ultimate objectives with which the Real Estate (Regulatory & Development) Act of 2016 was enacted.
Disclaimer – The above brief is based on the personal interpretation of the verdict and related laws which may differ from person to person. The readers are requested to take expert advice before putting reliance on it. For any clarification, please contact at firstname.lastname@example.org or visit www.centrik.in