The exclusion of ongoing projects where 60% of the work is completed or those where sale deeds have been executed from the ambit of the Real Estate (Regulation and Development) Act, 2016 in Karnataka, has drawn sharp criticism from homebuyers.
What has also come under the lens is the “subjectivity” of the criteria for exemption that many allege has created a loophole for developers to evade provisions of the Act. M.S. Shankar of Fight for RERA – Karnataka Chapter came down heavily on the dilution.
“This 60% completion level can be manipulated by the developers, and most of the ongoing projects will be kept out of the RERA ambit in Karnataka, including BDA’s Nadaprabhu Kempegowda Layout,” he feared.
Another concern is who will determine the stage of completion. Venkatesh Thogarighatta of Home Box, a real estate startup, said the devil lay in the details of the rules.
“What is the mechanism put in place to determine the level of completion of a project? There will be some fair play only if Real Estate Regulatory Authority conducts an audit and not if the level of completion is declared by the builder. This opens the project’s status to much interpretation,” he said.
Raghu K.C., who has been waiting for his flat in a project that has 1,800 units in Anekal, said in their project only the super structure has been completed.
“Our assessment is that over 50% of the work is still remaining, but the developer claims it is nearing completion. If this determination is left to the builders, RERA will be a useless piece of legislation in the State,” he said.
The industry remains cautious in its reaction to the rules. Farooq Mohammed, chairman and managing director of Silverline Realty, said an assessment of the impact was possible only after the final notification of the rules.
“We welcome the exemption of ongoing projects that are 60% complete. But there is no clarity on the terms of exemption. Should projects be 60% complete and sale deeds executed or, will a project be exempted if it satisfies either of them? We would prefer all projects that have secured the Commencement Certificate be exempt from the purview of the Act,” he said.
