Recently, the Modi Government amended the Real Estate (Regulation and Development) Bill 2013. Previously, the bill was only meant to safeguard the interests of residential home buyers. However, the approved changes in the bill incline it in the favor of the buyers and investors as well as the developers and cater to industrial and commercial properties as well.
The bill brought forward the issue of contract enforceability and made it clear to the developers that if they do not honor the contracts they have entered into, they must refund the amount to the buyers along with interests and other charges. Each state will have its own real estate regulator and all the commercial and residential properties will be registered with the regulator. Unregistered properties will not be considered genuine. Nor can the developers advertise or launch projects without registration. However, real estate projects that have already been launched will be covered.
The amended bill also wants the developers to make proper disclosures about the layout plan, name of the engineer, architect etc., to ensure transparency. Also, they will have to sell the property on the basis of super area and not carpet area. Super area is the area of the flat and the common area. The construction has to be done in accordance with the rules and regulations specified by the authority. Violation of rules will call for a penalty equal to 10 percent of the cost of the project and misinformation will call for 5 percent.
Moreover, the regulatory bodies will have to take actions on complaints within 60 days. In case the developers want to make changes in the set plans, they will need the consent of at least two-third of the total buyers. The promoters must deposit 50 percent of the total amount collected by the buyers in a separate bank account within 15 days. Ensuring transparency in the transactions and greater accountability, the new real estate bill has brought good news for the developers as well as the investors.