Real Estate Regulations Act (RERA) and its Applicability

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The main aim of the RERA act is to regulate and make the sector more transparent to stakeholder; home buyers, investors, financial institutions and allied sectors.

RERA Act is implemented all over the countries except Jammu and Kashmir & West Bengal. 

How RERA Works?

  1. RERA act is the first regulatory Which makes the states to form its own regulator and frame the law as per the need of the state.
  2. To make sure that all the developers and their projects & brokers are registered under RERA Act.
  3. Sale, purchase including the promotion of building will be punishable if it is not registered under RERA act.
  4. If a developer is not able to complete the said promises or submission of plans on time-related to delivery, construction, amenities, specifications and facilities shall be punishable as per the RERA act.
  5. 5.RERA act makes the process simpler by bringing better accountability and transparency 
  6. The Act establishes the Real Estate Regulatory Authority (RERA) in each state for regulation of the real estate sector and also acts as an adjudicating body for fast dispute redress.
  7. It will decrease the lack of transparency related to price, Construction delay, ownership etc.

Why is RERA not applicable in West Bengal?

West Bengal implemented its own act such as West Bengal Housing Industry Regulations Act. 

Where does the RERA act will Be Applicable?

  1. This Act is applicable to under construction and new projects of building
  2. RERA act will be applicable to Brokers & Agents who help in finding the building area.
  3. Any projects over 8 apartments or size of 500sq meter need to get registered under RERA act.
  4. 4.RERA also makes it necessary for builders to issue occupation and completion certificates before handling the possession to the buyer.

 What are the requirements under RERA act?

  1. RERA requires an Appellate Tribunal to address grievances so every state must set up an Appellate Tribunal.
  2. RERA specifies that all the builders must get registered under the specified act with the tribunal.
  3. While getting registered the builder must specify the design and deadline completion.
  4. Builder is required to set aside 70% of primary funds in the escrow account for construction of a property. So that they cannot divert the fund to any other project.
  5. As per the Act builder cannot accept more than 10% as initial deposit.
  6. If the deadlines are not met as per the guidelines RERA act then the builder will be liable for the compensation and punishment.

What are the details required to get registration of Real estate project?

1) Promoters Details

Such as Promoter name, Email id, pan and Mobile number’s, Address, Company Registration number etc. including Authorized signatory, Project head, RERA registration number and any other details.

2) Projects Details for Registration

Project name, project type, description, status of the project, project commencement and ending date, Total open and covered area of land, Total area of garbage, cost of construction and other project cost details etc.

  1. Development Details for registration
  2. Internal development work for registration
  3. Project Bank details for registration
  4. Project Agent details for registration if Applicable
  5. Project Architect details for registration
  6. Project Structural Engineer Details for Registration
  7. Project contactor Details for registration.

3) A complete list must be provided to RERA regarding the documents of project.

4) Payment of Online Fees

5) Hard Copies of following documents self-attested must be submitted within 3 days  

Which includes Fee receipt, Application document, Email print out, RERA Application print out etc..

6) ITR of last 3 years and balance sheet of builders

7) The declaration that builders have a legal title of the project.

How could one settle a dispute under RERA?

Consumer related issues mostly settle in Consumer Court but the implementation of the Real Estate Regulatory Authority helps to settle the cases related to the residential & commercial sector.  Appellate Tribunal should settle the dispute within a period of 60 days. However prior to RERA regulatory Authority In Consumer Court mostly people used to apply for cases even related to the real estate sector.

In one of the cases prior to RERA Act Arti Singh, 30 year scheduled to get her possession of a new house in 2010. But the builder failed to meet the deadline so she moved to consumer Court in the year 2015 but in 2016 RERA came into limelight with the approval of Consumer Court she moved the case to RERA act.

What are the Compliances under RERA Act?

  1. One Must upload all the details in the RERA Website along with Agreements, Plans & Approval.
  2. The builder must upload details of the project in the RERA website on a Quarterly basis, not complying with the given provision then the builder may need to pay a hefty penalty.
  3. As mentioned Separate bank accounts for 70% of receipts.
  4. Must ensure that transaction done through RERA agent, while booking the acceptance must be not more than 10% and must be approved by the buyer.
  5. There must be Timely completion of projects and delivery of common area within the period of 3 months.
  6. A builder must rectify if any defects take place in a building, it must be rectified within a period of 30 days from the date of intimation.
  7. Withdrawal from the RERA account to be certified by Engineer, Architect and Chartered Accountant.
  8. RERA Account must not be used for any purposes apart from Construction and land cost of the projects.

What are the penalties for non-compliance of RERA Act guidelines? 

If any Non-Compliances noticed by RERA by the promoter, agents etc. Following penalties must be paid by the respective person, and these are the following penalties for non-compliance of any provision or guidelines by RERA law.

  1. If any promoter, agent or builder failed to register their projects or commercial area under RERA act then the following person must pay a penalty of 10% and if any violation for a continued period then the imprisonment of 3 years or both.
  2. RERA can revoke the project after giving notice of 1 month if they found any default is made in the act, unfair trade practices been done by Promoter, agent or builder etc.
  3. While registering with RERA act if any False information given by respective parties then the penalty of 5% of the project cost will be applicable on them.
  4. If the order of Adjudicating officers not obeyed by the promoter, builder, agents etc then they will be liable for the fine of 10% of project cost and imprisonment of 1 year.
  5. The allottees will even be liable for the non-compliances regarding Appellate Tribunal or any contravention of the provision of any acts, rules or regulation mentioned by RERA act and they need to pay 5% or 10% of the cost of the property as per the rule of law.

Case Study

Bindu R Jaisingh V/s Ekta Parksville Homes Pvt. Ltd.

Complainant booked an apartment in BROOKLYN PARK PHASE II in Virar through Allotment letter on date 08th July 2014 and promised to get possession in the year 2017 by June, but no possession was given. Respondent given the reason for the delay in possession of the project as stated by them it was out of their control.


As per section 13 of Real Estate (Regulations and Development) Act 2016 the authority directed to register the agreement for sale with the parties within a period of 45 days from the date of order.

And order to the respondent to handover the possession of the property before the ending of June 2019 and if not handover then from 1st July 2019 respondent need to pay interest till the entire paid.

What does Section 13 of the Real Estate (Regulation and Development) Act 2016 states as it is mentioned in the above case study?

As per section 13 of the Real Estate (Regulation and Development), Act 2016 states that No deposit or Advances to be taken by the promoter without first entering into an agreement of sale.

  1. Without entering into an agreement of sale with the party one cannot take a sum of more than 10% of the cost of apartment, plot or building, application fees, advances etc.
  2. In agreement of sale it must be mentioned precisely about property construction details, internal & external development work, what amount interest will be payable by the promoter if any default has been conducted by them and all other important details of the property.

What provision will be applicable to calculate the interest rate in case default in property dealing in the state of Maharashtra?

Rule 18 of the Maharashtra Real Estate (Regulation and Development) (Registration of Real Estate Projects, Registration of Real Estate Agents, Rates of Interest and Disclosures on Website) Rules, 2017.


RERA law implementation had helped many buyers to get justice from appellate tribunal within the appropriate period of time against default in property settlement from the builder of the construction property. With RERA act it becomes easy to get all the information of construction pre during and post-construction or possession of the property.


Sushma Gowda

Student, Vivekanand Education Society of Law Chembur Mumbai.

Sushma Gowda is a 1st year law student of Vivekananda education society of Law Chembur. She is an enthusiastic person to learn core area of various laws. She possesses research and drafting skills in different field of law. For any clarifications, suggestions and feedback kindly find her at

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