Duties and Liabilities of a Promoter under RERA


Status as on- 10/05/2021

It is required for a promoter to register under the RERA Act, and each project should be enlisted with the RERA. To secure the interests of purchasers, the law forces different commitments and liabilities on the promoters and developers to guarantee decency and straightforwardness, if there should be an occurrence of dealings with real buyers.

A “Promoter” is an individual who begins the thought for the development of an organization and gives the commonsense shape to that, through the assistance of his own assets and with that of others”. A promoter can be an individual, a firm, an association of persons or even an organization who creates building site and offer the property to the purchasers.

In this article, we will examine a couple of focuses on commitments and liabilities for promoters under RERA act.

The following are the obligations and liabilities of promoters:

A Promoter must make his own website and put all subtleties of the proposed project for general visibility, including the exact subtleties of enrollment, quarterly reserving update of level, plot, project status, other data and records as determined by the guidelines that are made by the power.


It is composed that a promoter or developer must convey the following documents at the hour of booking a property and giving the distribution letter to the authentic clients:

  • Approved plans of the project.
  • Project layout plans with specifications approved by the competent authority.
  • Time schedule of proposed project completion, including the provided civil infrastructures such as water system, sanitation and electricity.


Proposed land undertaking to be enrolled with RERA.

  • Not to advance or sell without enlisting the venture.
  • The promoter will give explicit records at the hour of appointments and giving distribution letters.
  • It is their duty to get the occupancy certificate and give it to the allottees separately or to the association of allottees.
  • To have the rent authentication, determine the rent term, taken care of and confirm the obligations and charges sum identified with the leasehold land, and to give the rent declaration to the purchaser’s board.
  • Refund the add up to the purchaser if there should arise an occurrence of inability to follow through on schedule.
  • To offer pay to the purchasers because of the damaged title of the land.
  • The promoter ought not get in excess of a modest amount of the all-out cost of a level, house or plot.


The agreement will be endorsed in the recommended structure available to be purchased. This agreement structure will incorporate subtleties of venture advancement and the date of installment for the apartment, as well as the undertaking work, property move and so on.

Case Analysis: “Lavasa Corporation Ltd.Hicon… vs Manju Nrendra Joshi of Mumbai… on 7th August, 2018”wherein it was held that,

“The RERA, therefore, imposes an obligation upon the promoter not to book, sell or offer for sale or invite persons to purchase any plot, apartment or building, as the case may be, in any real estate project, without registering the real estate project with the Authority. It makes the registration of real estate project compulsory, in case where the area of land proposed to be developed exceed 500 sq. mtrs. or number of apartments proposed to be developed exceed 8, inclusive of all phases. It imposes an obligation upon the Real Estate Agent also not to facilitate sale or purchase of any plot, apartment or building, as the case may be, without registering himself with the Authority. The Act imposes liability upon the Promoter to pay such compensation to the Allottees in the manner, as provided under RERA, in case if he fails to discharge any obligations imposed on him under RERA.”

“Here in the case also, the consideration amount for the apartments agreed to be handed over to the Respondents is already obtained by the Appellant. As per the ‘Agreement’, the possession of the apartments was to be delivered within 24 months from that date; however, even after the lapse of 7 years, the Respondents have not received the possession; thereby indicating default on the part of the Appellant in fulfilling his obligations. If such ‘Allottees’, like the Respondents herein, cannot be Lavasa.doc kept out of the purview of the Act, which is clearly enacted with express intent to ensure that, they get the succor. At the cost of repetition, it has to be stated that, the mischief, to suppress which, the Act was enacted, was that there was no law regulating the real estate sector development work and obligations of ‘Promoters’ and ‘Allottees’. This need was felt by the ‘Parliament’, because it was noticed that all over the country, in large number of projects, the ‘Allottees’ did not get possession for years together and huge sums of money of the ‘Allottees’ was locked in such projects. Hence, if, in the similar situation and fact, the funds of the Respondents are locked in the development projects of the Appellant, they cannot be deprived from the benefit of this Act, merely on the count that the ‘Agreements’ executed by them with the Appellant are titled as ‘Agreement to Lease’ and not ‘Agreement of Sale’.”

The case examined here says that the promoters should enroll the land tasks and themselves under the RERA to deal or buy any plot or apartments to any individual or a person. The promoter is caused at risk to pay remuneration on the off chance that they neglect to release their commitments under the RERA. It is additionally said for this situation that the respondent didn’t get the ownership of the apartment even after the pass of 7 years which was resolved to be conveyed inside two years. Thus, RERA says that survivors of these cases can’t be denied from any advantage and their sum can’t be bolted by the promoters or developers since it is hard brought in cash.


In the field of real estate business, there are immense duties and liabilities a promoter has. Other than the above point, wellbeing and security is another significant piece of this article. A promoter should consider the future security of the buyers. Therefore, a promoter ought to give protected and right quality land administration to their expected clients.


Disclaimer– The above article is based on the personal interpretation of the related orders and laws. The readers are expected to take expert opinion before relying upon the article. For more information, please contact us at rera@centrik.in


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