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Salient features of the Real Estate Act, 2016
Notable case laws
Complaints filed under the Consumer Protection Act, 1986
Real Estate Law Firm Lawyers In India
Real Estate Law Firm Lawyers In Delhi
FAQ Real Estate Law
  1. What is Real Estate?

    According to Black’s Law Dictionary, ‘Real Estate’ includes land and anything fixed, im-movable, or permanently attached to it such as buildings, walls, fixtures, improvements, roads, trees, shrubs, fences, roads, sewers, structures, and utility systems.

  2. What is the law governing Real Estate in India? When was this law made?

    The laws governing Real Estate in India is the Real Estate (Regulation and Development) Act, 2016. It is as new legislation and was enacted on March 26, 2016. .

  3. What were the previous laws governing the issues related to real estate ?

    Before the passage of the new act, the Indian Real Estate sector lacked a clear regulatory ovesight. Previously, the sector was governed by The Indian Contract Act, Competition Act, Consumer Protection Act and other such laws.

  4. What are the objectives of the Real Estate (Regulation and Development) Act, 2016?

    The Act aims to effectively regulate the real estate sector by bringing in reform and clarity for both buyers and sellers. With the noble end of increasing transparency & accountability in the sector, it aims to establish the Real Estate Regulatory Authority to ensure sale of plot, appartment or building in an efficent manner.

  5. Is the Real Estate Act retrospective in nature?

    The Act is not retrospective in nature per se but ongoing projects for which completion certificate has not been issued shall be registered with Real Estate Regulatory Authority within 3 months from the date of commencement of the Act .

  6. What is the nature of real estate that come under the ambit of the act?

    Both residential and commercial real estate will fall under the ambit of The Real Estate (Regulation and Development) Act, 2016.

  7. What is the authority governing real etstate issues?

    There are two authorities that have to be formed under this act namely;

    1. Real Estate Regulatory Authority

    2. Real Estate Appelate Authority

  8. When will the Real Esate Regulatory Authority be formed?

    Both the authorities have to be formed within a year of the commencement of The Real Estate Regulatory Authority.

  9. Are orders passed by the Real Estate Regulatory Authority appealable?

    Yes, orders passed by the Real Estate Regulatory Authority are appealable to the Appelate Authority known as Real Estate Appelate Authority within 60 days of passing of the order.

  10. Who can appeal against the order of Real Estate Regulatory Authority?

    The following can appeal agaianst the order of Real Estate Regulatory Authority:

    1. Appropriste Government

    2. Any Competent authority

    3. Any aggreived person

  11. Where can a person appeal against the order of Real Estate Appelate Authority?

    The Act provides scope for an appeal to the High Court within 60 days by virtue of Section 58 of the Act if the concerned person is aggrieved by the decision of the Appellate Authority. Such an appeal will only lie if the decision has not been made with the consent of both the parties.

  12. Who is a promoter under the act?

    According to section 2(zk) of the act promoter means:

    1. a person who constructs or causes to be constructed an independent building or a building consisting of apartments, or converts an existing building or a part thereof into apartments, for the purpose of selling all or some of the apartments to other persons and includes his assignees; or

    2. a person who develops land into a project, whether or not the person also constructs structures on any of the plots, for the purose of selling to other persons all or some of the plots in the said project, whether with or without structures thereon; or

    3. any development authority or any other public body in respect of allottees of—

      • buildings or apartments, as the case may be, constructed by such authority or body on lands owned by them or placed at their disposal by the Government; or

      • plots owned by such authority or body or placed at their disposal by the Government; for the purpose of selling all or some of the apartments or plots, or

    4. an apex State level co-operative housing finance society and a primary co-operative housing society which constructs apartments or buildings for its Members or in respect of the allottees of such apartments or buildings; or

    5. any other person who acts himself as a builder, coloniser, contractor, developer, estate developer or by any other name or claims to be acting as the holder of a power of attorney from the owner of the land on which the building or apartment is constructed or plot is developed for sale; or

    6. such other person who constructs any building or apartment for sale to the general public.

  13. What are the liabilities of a promoter under the act?

    The Real Estate Act requires a promoter to do the following:

    1. To make available the documents and information necessary for inspection to persons taking or intending to take a property. These documents include the ones necessary for registration but are not limited to them. Further, the title should be certified by the Revenue Authority. Details regarding encumbrances, layout plan, estimated cost should be given.

    2. To issue or publish an advertisement or prospectus for inviting persons to make advances only after acquiring registration and filing a copy of the advertisement in the office of the Regulating Authority.

    3. To enter all records and details on the website maintained by the Authority after verifying the facts.

    4. To compensate any person who suffers a loss by reason of any untrue statement in the advertisement or prospectus.

    5. To receive any advance or deposit from a real estate consumer only under a written agreement of sale

    6. Give due notice to other parties and refund the amount with the specified interest before cancelling any agreement.

    7. To take measures for the protection and safety of the property. Promoter is also supposed to maintain accounts of sums taken from and on behalf of the allottees, register and record for audit purposes in a prescribed manner.

    8. To make certain documents available to the allottees during the project period. These documents are in addition to the ones contemplated in Section 6 of the Real Estate Bill which were for the purpose of inspection and include site plans with structural designs and specifications, nature of fittings, time schedule of completion of project and for connecting the project with municipal services, agreements entered into regarding the construction of the building and statutory compliance related to revenue, planning, building and structural safety laws. A completion certificate of the project is to be obtained b the promoter from the local authority and given to the allottee. This list is however, not exhaustive as other documents may be required to be given by the promoter.

    9. Not to make any alterations can be made to the approved layout plan after it is given to the allottee without the previous consent of the allottee, architect and engineer and without permission of the Regulatory Authority.

    10. To rectify any defect brought to his notice within 2 years of possession of property by allottee and should compensate for the same. Any dispute in this regard is to be referred to the Regulatory Authority.

    11. To complete his title and convey exclusive ownership of the concerned property and interests therein to the allottee. The promoter shall deliver the documents of title to the allottee within three months of giving possession of the concerned property by way of a conveyance deed.

    12. Not mortgage the plot or apartment without the consent of the person who has taken or agreed to take such plot or apartment after execution of agreement of sale and if such a mortgage is made it shall not affect the right of such a person.

    13. Beresponsible for supplying essential services such as water, electricity, sanitary services and these services can be withheld only with just and sufficient notice.

  14. What are the salient features of the act?

    Broadly speaking, the salient features of the Act are:

    1. Establishment of Real Estate Regulatory Authority

    2. Registration of Real Estate Projects and Registration of Real Estate Agents

    3. Mandatory Public Disclosure of all project details.

    4. Functions and Duties of Promoter

    5. Compulsory deposit of 50 percent amount

    6. Adherence to declared plans

    7. Functions of Real Estate Agents

    8. Rights and Duties of Allottees

    9. Functions of Real Estate Regulatory Authority

    10. Establishment of Real Estate Appellate Tribunal

    11. Punitive Provisions

    12. Bar of Jurisdiction Courts

    13. Power to make Rules and Regulations

  15. What is built up and super built up area?

    Built up area includes the actual usable area of the plot plus the inner and outer walls. Super Built up area includes the built up area and the additional common area around the plot like lobby, lift space etc.

  16. What is the mandatory amount to be deposited with the bank by the promoters?

    It is compulsory to have a separate Escrow Account to be opened for each project and an amount equal to 70% collected against a particular project has to be deposited in that ac-count.

  17. What are the rights and duties of the allotees?

    The allottee is liable to make necessary payments as stipulated under the agreement and shall also pay his share of municipal taxes, electricity charges, rent and other charges.

  18. What will be the repurcussion if there is misleading/false advertisement?

    According to Section 12 of the Act, if a person has paid an advance or deposited a sum on the basis of false/misleading advertisement, then the promoter shall be liable to pay compen-sation and also if the person wants to withdraw the investment, he shall be returned the en-tire amount with interest according to the Act.

  19. What are the penalties under the Act?

    Penalties for offences under the act are:



    Provision in the Act

    Promoter does not register his property

    Penalty up to 10% of the project cost

    Section 59

    Promoter dodges order issued by the RERA

    Penalty up to 5% of the estimated project cost

    Section 63

    Promoter provides false information

    Compensation provided by promoter

    Section 12

    Promoter violates any other provision of the Act

    Penalty up to 5% of the estimated project cost

    Chapter viii


    Section 65 states that fine for the agents is calculated per day during the period of violation of provision and can go upto 5% of the cost of project.

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