The Telangana State may miss the deadline for the formation of the Real Estate Regulatory Authority (RERA). The Real Estate Regulation Act, 2016 came into force last year and the mandate for all the State governments was to form a RERA by May 1, 2017.
However, the State government is “still studying” the rules notified by other States and Union Territories, taking the feedback from various stakeholders and are yet to prepare the draft rules.
Recently, a meeting was held in this regard which was attended by IT Minister KT Rama Rao and senior officials of the State Municipal Administration department. The Minister had directed the officials to prepare the draft rules and submit to the government for approval.
Appellate tribunal
But, the entire process might take time as the Real Estate Appellate Tribunal (REAT) also has to be formed which can only happen after the draft bill is passed in the State Assembly. Once RERA is constituted, all the builders have to register with the body.
Projects coming up in more than 500 sq. m or construction of more than eight apartments have to get registered and it is compulsory for the proposed project and any ongoing one within 90 days. Without registration advertising, marketing, booking, selling, etc., is prohibited for any plot, apartment or house. Registration is not required for projects where Occupancy Certificate has been obtained.
The consumers can approach RERA in case the builder fails to deliver on time or goes back on his promises related to amenities as it would be maintaining website of records, publicly accessible, of all projects with details.
Pro-consumer
The Bill is seen as more pro-consumer which has led to some section of the builders and real estate developers to express their displeasure. “The project costs will go up by 15% to 20% as there will be regulatory charges and compliance charges,” said C. Shekar Reddy, former national president of CREDAI (The Confederation of Real Estate Developers Associations of India).
“Only those who have financial muscle will withstand in the market after the Act is implemented. It is discouraging for financially weak builders. It is also unfortunate that the developer has no redressal forum. There is every chance of this body being misused by some who want to extract money from the builders.”
Clarity sought
The representatives of CREDAI welcomed the move to set up a regulatory authority but also sought clarity on some of the points mentioned in the original Act. “We are not opposed to the act as it will make sure that the business is done in an ethical way,” said S. Ram Reddy, CREDAI President.
“There is no clarity for certain terms used in the Act and we asked the State Government officials to make it clear. For instance, Saleable Building Area is not defined properly,” he pointed out.
