RERA Important facts to Know
RERA Important facts to Know
The Real Estate (Regulation and Development) Act, 2016 is an Act of the Parliament of India which seeks to protect home-buyers as well as help boost investments in the real estate industry. The bill was passed by the Rajya Sabha on 10 March 2016 and by the Lok Sabha on 15 March 2016. The Act came into force from 1 May 2016 with 69 of 92 sections notified. The Central and state governments are liable to notify the Rules under the Act within a statutory period of six months. This act has been made in accordance to increasing complaints against the builders or promoters and the real estate agents. These complaints are mainly regarding the late possession of a house to the buyer, irresponsible behaviour of promoters after the signing of the agreement and many such issues. RERA is a government body whose sole purpose is to safeguard the interest of buyers as well as lay a path so that the promoters and the real estate agents get a chance to come up with good services.
STATUS:
1. What is the status of the Act?
The Real Estate Bill was passed by the Rajya Sabha on 10th March, 2016 and the Lok Sabha on 15th March, 2016, assented to by the President on 25th March, 2016, and published in the Official Gazette on 26th March, 2016.
2. When did the Act come into force?
Section 2, sections 20 to 39, sections 41 to 58, sections 71 to 78 and sections 81 to 92 were notified by the Central Government to come into effect from 1st May, 2016.
3. Why have some sections of the Act not been notified yet?
Some sections of the Act have not been notified yet, as the institutional structures, namely the establishment of the Regulatory Authority etc., which are necessary prior to their enforcement have not yet been operationalised in all States. For e.g. projects can only be sold after they are registered with the Authority. In Madhya Pradesh the Rules were notified on 22nd October 2016 and the Authority established on 15th December 2016.
4. When would the remaining sections of the Act come into force?
Sections 20 and section 43 provide that the Authority and the Appellate Tribunal need to be established within 1 year of the commencement of the Act. The said sections were notified for commencement on 1st May, 2016. Sections of the Act which have not been notified yet, would be notified latest by 30 April 2017.
OBJECTS AND REASONS:
5. What was the need for a regulatory law for the real estate sector?
The real estate sector has grown in the recent years but has largely been unregulated from the perspective of consumer protection. Though consumer protection laws are available, the recourse available therein are only curative, not preventive. This has affected the overall development of the sector due to absence of professionalism and standardization.
6. What are the objects and reasons for which the Act has been framed?
The Real Estate Act is intended to achieve the following objectives:
a) ensure accountability towards allottees and protect their interest;
b) infuse transparency, ensure fair-play and reduce frauds & delays;
c) introduce professionalism and pan India standardization;
d) establish symmetry of information between the promoter and allottee;
e) imposing certain responsibilities on both promoter and allottees;
f) establish regulatory oversight mechanism to enforce contracts;
g) establish fast- track dispute resolution mechanism;
h) promote good governance in the sector which in turn would create investor confidence.
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