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1. When was the Real Estate Bill passed?
The Real Estate Bill was passed by the Rajya Sabha on 10th March, 2016 and the Lok Sabha on 15th March, 2016. The Bill as passed by the Parliament was assented to by the Hon'ble President on 25th March, 2016. The Act as assented to by the Hon'ble President was published in the Official Gazette on 26th March, 2016 for public information.
2. When did the Act come into force?
Provisions of section 2, sections 20 to 39, section 41 to 58, sections 71 to 78 and sections 81 to 92 (relating to definitions, establishment/appointment of Regulatory Authority/Appellate Tribunal, Adjudicating Officer, framing of Rules/Regulations, constituting regulatory Fund, making website etc. came into force with effect from 1st May, 2016 vide Notfn. dt. 24.04.2016 of the Central Govt. (Ministry of HUPA). Remaining provisions of sections 3 to 19, 40, 59 to 70, 79 and 80 regarding registration of real estate projects, real estate agents, responsibilities of promoters/ allottees/agents, about penalties and offences etc. came into force w.e.f. 01.05.2017 vide Notfn. dt. 19.04.2017 of the Central Govt. (Ministry of HUPA).
3. Why were some sections notified later?
Some sections of the Act have been notified after one year, as the institutional structures, namely the establishment of the Regulatory Authority and the Appellate Tribunal are necessary prior to their enforcement.
4. What was the need for a regulatory law for the real estate sector?
The real estate has grown in the recent years but has largely been unregulated from the perspective of consumer protection. Though, consumer protection laws are available, the recourse available therein is only curative, but not preventive. This has affected the overall potential growth of the sector due to absence of professionalism and standardization.
5. What are the objectives of the Act ?
The Real Estate Act is intended to achieve the following objectives:
6. Who is the 'appropriate Government' as per the Act?
Section 2(g) of the Act defines 'appropriate Government accordingly in the State of Rajasthan, the State Govt. is the appropriate Govt..
7. What are the important responsibilities of the State Government?
8. Does the definition of 'promoter' includes public bodies such as Development; Authorities and Housing Boards?
The Act covers all bodies (private and public) which develop real estate projects for sale to the general public. Section 2(zk) defines the term 'promoter' which includes both private and public real estate promoters. Thus all Development Authorities, UITs, Municipal bodies, Housing Board, when involved in sale, are covered as Promoter under the Act.
9. Does the definition of 'promoter includes all promoters in case of joint development?
As per the Explanation to section 2(zK)"where the person who constructs or converts a building into apartments or develops a plot for sale and the persons who sells apartments or plots are different persons, both of them shall be deemed to be the promoters and shall be jointly liable as such for the functions and responsibilities specified, under this Act or the rules and regulations made there under".
10. What is the rate of interest payable in case of default by the 'promoter' or the 'allottee'? Is the rate of interest payable by either party (promoter or allottee) the same?
As per the Explanation to section 2(za) the rate of interest payable by either the promoter or the allottee shall be the same. The rate of interest has been specified in Rule 17 of the Rajasthan Real Estate (Regulation and Development) Rules, 2017. Accordingly the rate of interest is State Bank of India highest marginal cost of lending rate plus two percent. Provided that in case the State Bank of India marginal cost of funds based lending rates is not in use it would be replaced by such benchmark lending rates which the State Bank of India may fix, from time to time, for lending to the general public.
11. Does advertisement includes solicitation by emails and sms? Is issuance of prospectus considered to be a case of 'advertisement'?
As per section 2(b), which defines ' advertisement' any medium adopted in solicitation for sale would be covered under the said definition, including SMS and e-mails.
12. Does the term ' allottee' include secondary sales?
As per section 2(d) an allottee includes a person who acquires the said ' apartment/plot' through transfer or sale, but does not include a person to whom such plot, apartment is given on rent.
13. Is 'open parking areas' a part of common areas?
Section 2(n) defines 'common areas' to include open parking areas; thus open parking areas cannot be sold to the allotters.
14. Is 'community and commercial facilities' which are provided in a real estate project are part of 'common areas'?
Section 2(n) defines 'common areas' to include 'community and commercial facilities; thus they are an integral part of the project, to be handed over to the Association/society of Allottees.
15. Whether obtaining both the 'occupancy certificate' and the 'completion certificate are necessary for the promoter?
Section 2(zf) and section 2(q) respectively, define 'occupancy certificate' and 'completion certificate'. The two definitions are very broad and uses the term by whatever name called. Thus, if only one certificate is issued which provides for both the aspects covered under the two definitions, it would suffice the requirements under the Act.
16. What is the difference between the term 'completion certificate' and 'occupancy certificate'?
Section2 (zf) and section 2(q) respectively, define 'occupancy certificate' and 'completion certificate'. Occupancy certificate relates to the occupation of the apartment/building, which has provision for civic infrastructure such as water, sanitation and electricity and is habitable. Completion certificate relates to the completion of the entire project certifying that the project has been developed according to the sanctioned plan, layout plan and sections, as approved by the competent authority.
17. The Act defines ' estimated cost of the real estate project', what is the significance of the definition?
section 2(v) defines 'estimated cost of the real estate project', which means "the total cost involved in developing the real estate project and includes the land cost, taxes, cess, development and other charges". The determination of the estimated cost of the real estate project is necessary due to chapter VIII of the Act, which provides that penalties would be imposed on the promoter, for violations prescribed under the Act, based on the estimated cost of the real estate project.
18. What is the definition of ' garage' and can it be sold by the promoter independent of an 'apartment'?
Section 2(y) defines the term ' garage', which can be sold to the allotted independent of the apartment;.
19. What is the definition of real estate project'? Does the term 'project' connote a 'real estate project?
The term 'real estate project has been defined under section2(zn) and the term 'project' has been defined under section 2(zj), which have been interchangeably used under the Act.
20. Are real estate agents covered under the Act? Does the term 'real estate agents' include web-projects engaged in selling of apartment or plots?
Section 2(zm) defines the term 'real estate agents', which is a very broad and inclusive definition and covers all from of agencies involved in sale and purchase of projects, registered under the Act. Consequently, web-portals etc. engaged in selling plots or apartments are also covered under the Act and are required to comply with the duties and responsibilities as provided therein including under the Rules and regulations made thereunder.
21. What happens in case a term is used under the Act but has not been defined?
Section 2(zr) is an omnibus definition which provides that terms which have not been defined under the Act or the Rules and Regulations made there under, would have the same meaning as respectively assigned to them under the relevant municipal law or under any law for the time being in force.
22. Which areas of the State are included in the Planning Area as defined in the Act?
As per definition 2(1)(f) in Rules, the planning area means a planning area or a development area as specified under the Master plan.
23. If a real estate project has land area more than 500 sq. meters but containing less than 8 apartments. Does it still need to be registered?
Yes. Every real estate project which has land area more than 500 sq. meters or has more than 8 apartments needs to be registered
24. If a real estate project has land area less than 500 sq. meters but contains more than 8 apartments. Does it still need to be registered?
Yes. Every real estate project which has land area more than 500 sq. meters or has more than 8 apartments needs to be registered
25.Can advertisement be issued for a new project after 1st May, 2017 without registering the said project?
No. The advertisement issued after 1st May 2017 must carry the Registration Number of the project issued by the Authority.
26.Is it permissible to sell parking to allottees?
The position of parking is as follows; Open Parking Area: This has been clearly included in the definition of "Common Areas" which need to be conveyed to the Association of Allottees after Occupancy Certificate is received. Hence, sale or allotment of Open Parking Areas by the Promoter is not permissible. Covered Parking is permitted to be sold. Garage as defined in the Act is permitted to be sold.
27.Does Long-term leasehold is excluded from ambit of the Act?
No. The wording in Section 2(d) “has been sold (whether as free hold or lease hold) or otherwise transferred by the promoter” indicates that the long-term lease falls within the ambit of the Act. However, the premises given on short-term lease not exceeding five years are not covered under the Act.
28.What is the obligation of the promoter towards return of amount and compensation to the allottee?
Section 18 of the Act provides for provisions as regards various situations in which the allottee would be compensated by the promoter due to delay in completion of the project etc.
29.Is there some fee, in addition to the fees prescribed in the Rules, to be charged from promoters, real estate agents and complainants for the website of the Regulatory Authority (rera-rajasthan.in) uploading and online services?
No. There are no additional charges for online services.
30. Does the Act cover both residential and commercial real estate?
Yes. The Act covers both residential and commercial real estate. Section 2(e) defines 'apartment' and section 2(i) defines 'building' which include both residential and commercial real estate.
31. Does the Act cover ongoing/incomplete projects?
Yes. As regards the ambit of the Act, there is no distinction between an ongoing project and a future project. In other words, both ongoing/incomplete projects and future projects are covered under the Act. As per section 3(1) first proviso, the promoters of all ongoing projects will need to register their projects with the Regulatory Authority, within 3 months of its commencement, i.e. 1st May 2017.
32. Does the Act cover all projects in urban areas and in rural areas?
Section 3(1) provides that all projects within a 'Planning area' will require to be registered with the Authority and 'planning area' has been defined under section 2(zh). However, section 3(1) second proviso gives powers to the Authority in the interest of 'allottees' to order/direct the promoter to register projects beyond the planning area, which has the requisite permission of the local authority.
33. Which projects are exempted from the ambit of the Act?
As per section 3(2) the following projects do not require to be registered under the Act: - Where the area of land proposed to be developed does not exceed five hundred square meters or the number of apartments proposed to be developed does not exceed eight, inclusive of all phases. - Where the promoter has received a completion certificate for a real estate project prior to commencement of the Act, i.e. 1st May 2017. - For renovation, repair, or re-development which does not involve marketing, advertising, selling, or new allotment of any apartment, plot, or building.
34. At what stage can a promoter start to advertise his project for sale?
The promoter can advertise his project for sale after the project has been registered with the Regulatory Authority as provided in section 3(1).
35. What are the details to be furnished at the time of application for registration of a real estate project with the Regulatory Authority?
Section 4 of the Act provides for details/information/documents and undertakings to be provided by the promoter to the Authority for registration of the project. Some additional information/documents are also to be furnished as per Rule 3 of the Rajasthan Real Estate (Regulation and Development) Rules, 2017.
36. What are the formalities for the registration of a real estate project with the Regulatory Authority?
The promoter is required to make an application in Form-A and pay the fees prescribed under Rule 3(3) of the Rajasthan Real Estate (Regulation and Development) Rules, 2017, along with documents/information and undertaking in Form-B to the Authority for project registration.
37. In how many days is the Regulatory Authority required to register the real estate project?
The Regulatory Authority is required to register the project, if it is in compliance with the Act and the Rules and Regulations, within 30 days of the application having been received by the Authority.
38. What happens if the application for registration of the real estate project is incomplete?
If the application is incomplete as per the Act or the Rules, the Authority may grant an opportunity to complete it. If non-compliance persists, the Authority has the power to reject the application after giving the promoter a chance to be heard.
39. Is there a provision for deemed registration of a real estate project if the Regulatory Authority does not respond?
Section 5 of the Act states that if the Authority does not take a decision within 30 days of application receipt, the project shall be deemed to be registered.
40. What is the validity period of registration granted to a real estate project by the Regulatory Authority?
As per section 4, the validity of the registration shall be the period declared in Form-B by the promoter, under section 4(2)(I)(C), at the time of making the application.
41. Can an applicant-promoter withdraw their application for registration?
Yes. If the promoter withdraws before the 30-day period under section 5, a processing fee of 5% or ₹25,000 (whichever is more) will be retained, and the remaining amount refunded within 30 days.
42. Is the promoter required to maintain an escrow account or a separate account?
Section 4(2)(I)(D) requires the promoter to maintain a separate account for each project where 70% of the funds received from allottees must be deposited for construction and land costs.
43. On what basis is the promoter allowed to withdraw money from the separate account?
As per section 4(2)(I)(D), withdrawals must be in proportion to the project’s completion percentage and must be certified by an engineer, an architect, and a chartered accountant.
44. Is the promoter required to get their accounts audited?
Yes. As per section 4(2)(I)(D), the promoter must get accounts audited within six months after each financial year-end to ensure funds are used in compliance with the Act.
45. Can the application for registration of a real estate project be done manually or online?
For the first year, applications can be submitted both manually and online. After that, the process must be entirely online. In Rajasthan, the web portal of the Regulatory Authority enables online submission of applications, complaints, and appeals.
46. Can the period of registration granted to a real estate project by the Regulatory Authority be extended? What is the definition of force majeure?
Section 6 envisages two situations within which the registration granted to a project can be extended. Extension of registration can be granted in case of force majeure. In addition, it can also be granted under reasonable circumstances, without the fault of the promoter, which shall not be more than a maximum period of 1 year.
Explanation to section 6 has defined force majeure to mean a case of war, flood, drought, fire, cyclone, earthquake, or any other calamity caused by nature affecting the regular development of the real estate project.
47. What are the terms and conditions for extension of registration?
The registration may be extended on an application made by the promoter in Form-E prior to the expiry of the registration already granted.
The application for extension of registration shall be accompanied with a proof of payment through online mode, for an amount equivalent to half of the registration fee as specified under sub-rule (3) of rule 3, along with an explanatory note setting out the reasons for delay in the completion of the project and the need for extension of registration for the project, along with documents supporting such reasons.
Provided that where extension of registration is due to force majeure, the Authority may at its discretion waive the fee for extension of registration.
48. Can the registration of a project be revoked?
As per section 7, the Authority has the powers to revoke registration of a project for violations specified under the said section. However, revocation of registration of a project is envisaged as a last resort and can only be done after providing a reasonable opportunity of being heard.
49. What are the next steps that can be taken for project completion in case of revocation of a project?
In case a project is revoked, section 8 provides for various mechanisms in which the project can be completed. However, in such a scenario, the association of allottees shall have the first right of refusal for carrying out the remaining development works.
50. Is it mandatory for the promoter to obtain permissions for the real estate project before applying for registration to Authority?
Yes, the layout of the real estate project has to be approved.
51. How will a flat buyer know if the real estate project is duly registered under the Regulatory Authority?
The Rajasthan RERA website (rera-rajasthan.in) would display all the registered projects.
It is mandatory that the advertisement for marketing of apartments in the real estate project must carry the registration number issued from the Authority.
52. How does the promoter make an application for registration?
The website of the Regulatory Authority has been launched. All promoters shall make their applications online through this website (rera-rajasthan.in), filling the details in the requisite forms, uploading the required documents, and paying the necessary fees through an online mode of payment.
53. Is it compulsory for the promoter to register the project immediately after he gets sanctioned approvals?
The promoter has to register the project before he starts any form of advertising, marketing, booking, selling, offering for sale, or inviting people to purchase plots, apartments, or buildings.
54. Will an ongoing project have to stop sales or construction until receiving the Registration?
At the end of ninety days from the date of commencement of Section 3 of the Act, i.e., 31st July 2017, the promoter of an ongoing project shall not advertise, market, book, sell, or offer for sale or invite persons to purchase in any manner any plot, apartment, or building unless he registers the project.
55. Can the promoter change the completion date for ongoing projects while registering?
Yes, while registering the project, the promoter needs to give a revised date of completion, which should be commensurate with the amount of development completed.
56. If an ongoing project is registered under the Regulatory Authority, will the Act be applicable for the entire project or only to units sold after registration?
Registration is of the Project/Phase, and hence the provisions of the Act are applicable to all units of the Project/Phase.
57. There is a provision for deemed registration of a real estate project in case the Regulatory Authority does not respond to the application. How will the promoter receive ID & password?
As per section 5(2) of the Act, the Regulatory Authority shall, within a period of seven days of the deemed registration, provide a registration number and a Login ID and password to the promoter for accessing the website of the Regulatory Authority and to create his webpage and fill therein the details of the proposed project.
58. How will the Act, Rules, and Regulations affect the advertisement of projects with many phases?
A promoter would be allowed to advertise, market, book, sell, or offer to sell or invite persons to purchase plots, apartments, or buildings in a phase of a real estate project, only if the said phase is registered. A promoter cannot advertise, commit, or sell amenities or facilities that are in a subsequent phase that is still not registered.
59. What if an adjoining land is purchased by the promoter? Can he continue with the same registration?
No, it has to be separately registered if the said adjoining land was not a part of the project which has been registered.
60. What should the promoter do in case a particular brand of fixtures and fittings as mentioned in the specifications is not available in the market?
In accordance with section 14 of the Act, the promoter should take previous consent of the concerned allottees. The promoter is also liable to rectify any structural defect, etc., within a period of five years from the date of possession.
61. Estimated Cost should be submitted only for the area for which approvals/plans are cleared as of the date of project registration?
Estimated cost of the whole project that has been put up for registration has to be indicated while applying for registration.
62. Are various certificates from Architect, Engineer, CA, etc. required at the time of project registration?
No. However, authenticated copies of necessary approvals from competent authorities are required as per section 4 and the Rules and Regulations made thereunder.
63. What are the important functions and responsibilities of the promoter after registration of the project with the Authority?
As per section 11 of the Act, the promoter is required to update all project information as furnished at the time of application (as provided under section 4) on the website of the Authority. In addition, section 11 also provides for certain information, which needs to be regularly (quarterly) updated by the promoter, in order to make an informed choice by the buyer.
64. What are the disclosures to be made on the website of the Regulatory Authority?
Section 4 and section 11 provide for a detailed list of disclosures on the website of the Authority by the promoter for public viewing. Also, the detailed list is specified in Rule 16 of the Rules. The website of Rajasthan RERA ("rera-rajasthan.in") is also to be seen.
65. What is the promoter's obligations regarding veracity of the advertisement or prospectus?
As per section 12, the promoter is responsible for the veracity of all information contained in the advertisement and the prospectus. In case of any loss sustained by any person due to false information contained therein, the promoter is liable to make good the loss sustained due to the same.
66. Can the promoter collect any amount of money towards booking of the apartment/plot?
Section 13 provides that the promoter cannot accept a sum more than 10 percent of the apartment/plot cost as an advance payment/application fees. For any further collection towards the apartment/plot cost, the promoter is required to enter into an Agreement for sale with the allottee.
67. What is the Agreement for sale and is it binding on the promoter and the allottee?
The format of Agreement for sale to be entered into between the promoter and the allottee has been prescribed as Form-G under the Rules. This Agreement is binding on the parties. Internal flexibility as per contractual understanding could be provided in the said Agreement for sale, for determination/insertion of other provisions as decided between the parties. However, such provisions should not be in derogation of or inconsistent with the terms & conditions of the format of the Agreement or the provisions of the Act and rules/regulations made thereunder.
68. Can the promoter modify/amend the sanctioned plans or project specification after having been approved by the competent authority and disclosed to the allottees?
As per section 14 of the Act, the promoter can only modify/amend the sanctioned plans or project specifications after the approval of the competent authority and its disclosure to the allottees, in case of minor additions or alterations. However, in case of major modification/alteration, the promoter can modify the sanctioned plans or project specification only after obtaining approval from two-thirds of the allottees. For arriving at the number of two-thirds allottees, the number of apartments held by the promoter will be excluded. Also, irrespective of the number of apartments held by an allottee, he/she shall only be entitled to one vote.
69. What is the period for which the promoter is liable for any structural defects etc. in the project/apartment etc.?
As per section 14(2), the promoter shall be liable for 5 years from the date of handing over of possession to the allottee towards structural defect or any other defect as specified therein.
70. What is the obligation of the promoter as regards transfer of the project to a third party?
As per section 15, the promoter is not entitled to transfer or assign his majority rights and liabilities in the project to a third party without obtaining the prior written consent of two-thirds of allottees and the Regulatory Authority. In addition, for arriving at the number of two-thirds allottees, the number of apartments held by the promoter will be excluded. Also, irrespective of the number of apartments held by an allottee, he/she shall only be entitled to one vote.
71. What is the obligation of the promoter as regards insurance of the real estate project?
As per section 16, the promoter is required to seek insurance for the real estate project towards the title of the land and towards the construction of the project. However, this provision shall only come into effect as notified by the State Government.
72. What is the obligation of the promoter as regards transfer of title of the apartment/plot?
Section 17 of the Act provides detailed provisions regarding the transfer of title of the apartment and the project to the allottee and the association of the allottees, respectively.
73. What is the obligation of the promoter towards return of amount and compensation to the allottee?
Section 18 of the Act provides for provisions regarding various situations in which the allottee would be compensated by the promoter due to delay in the completion of the project, etc.
74. Is the promoter required to give any undertaking to the Regulatory Authority for completing his project within a specified period?
Yes, in accordance with the provisions of the Act, the promoter, while applying for registration to the Regulatory Authority, has to give a declaration cum affidavit indicating the time period within which he undertakes to complete the project or phase thereof, as the case may be.
75. Is there a time limit prescribed for the promoter to execute conveyance in favor of the association of buyers?
The promoter shall execute a registered conveyance deed in favor of the allottee within three months from the date of issue of the occupancy certificate or when fifty-one percent of the total number of purchasers in such a building or a wing have paid the full consideration to the promoter, whichever is earlier.
76. When should a landowner be named and treated as a promoter?
77. When should a landowner not be named or treated as a promoter?
78. Can the promoter change the plans of subsequent phases after registration of the first phase?
The Act obligates a promoter to obtain the consent of each allottee if they want to change the building plans for a registered phase. If a subsequent phase has not been registered, the promoter can change the plans of the subsequent phases without obtaining consent from allottees of current/ongoing phases. However, if the subsequent phases are also registered, consent of allottees of the concerned phases would be needed as mentioned in Section 14 of the Act.
79. If the promoter needs to change the plans of an on-going project post registration, will he need the consent of the pre-registration purchasers?
The Act protects the interest of all the Allottees including those who have executed an agreement before the project is registered under its provisions. Hence, if the promoter wants to change the plans post registration, then consent of all pre-registration allottees shall be required as well.
80. The promoter can hand over the common amenities only after completing subsequent phases. What should he commit to the customer for the registered phase?
A promoter should meticulously plan the buildings of the registered phase & common areas and then declare the individual date of handing over possession of the building & common areas. Each phase along with the development works shall have to be completed and handed over to the allottee within the time frame defined by the promoter, during registration, for that phase of the project.
81. Is insurance of the project compulsory? What are the provisions regarding Insurance?
As per section 16 of the Act the promoter has to obtain all such insurance as notified by the State Government. So insurance will be compulsory only after the Notification is issued by the State Government. The Act says that the State Government can prescribe various types of insurance including but not limited to,
The promoter is liable to pay the insurance premium before transferring the same to the allottee / association of allottees. The documents related to insurance will have to be handed over to the association of allottees when the same is formed.
82. Can project finance taken by promoters from financial institutions be withdrawn from designated 70% account?
Yes, if this is declared at the time of registration and subject to provisions of Section 4 of the Act and Rajasthan Real Estate (Regulation and Development) Rules, 2017. However, the money withdrawn should be utilized towards construction expenses of the project, on priority.
83. In case of joint development with land owner on revenue share basis or area share basis, whether land owner’s component could be withdrawn from designated account of 70%?
The Act makes both the Promoters and the land owner or any such parties which are beneficiary of a sale of a project and receive payments from allottees, as Co-Promoters and hence liable to adhere to the provisions of the Act and Rules and Regulations made there under. The withdrawal of money would be subject to provisions of Section 4 of the Act and Rules made there under.
84. If due to a change in government policy, the promoter is entitled to additional FSI etc., can the promoter build additional floors in a registered ongoing project where initially those floors were not planned?
Yes, but consent of allottees would be needed as mentioned in section 14 of the Act.
85. While withdrawing money from the account as per provisions of section 4 (2) (l) (D), does the promoter need to submit the certificates to Banker or retain with him?
The original certificates have to be retained by the promoter because the same are required to be verified and audited by the statutory auditor of the promoter's company at the end of every financial year. Copies may also have to be submitted to the concerned bank, if demanded by them.
86. Can escrow account opened with the Bank from whom loans are availed by the promoter, be treated as Separate Bank Account for a registered project?
No. A separate bank account needs to be opened in accordance with the provisions of the Act and rules made there under.
87. Can separate account be more than one since at times there might be multiple lenders in same project (building wise lender) though developer might register the project at one go?
No. There should be one designated bank account for every registered project or registered phase of a project.
88. Sometimes buyer is ready and gives undertaking that he is ok to give money beyond 10% however does not want to register. Should it be allowed?
No. Section 13(1) of the Act prohibits the promoter from taking more than 10% of the cost of apartment without entering into a written agreement for sale, duly registered.
89. In case of customers default, can promoter be selective in cancelling units?
Provision of termination of agreement is covered in the Form of Agreement for Sale (Form-G) attached to Rajasthan Real Estate (Regulation and Development) Rules, 2017.
90. What are the rights and duties of the allottees under the Act?
Section 19 provides for the various rights of the allottees. This section specifies various rights which the allottees have against the promoters including those which the promoters are liable to fulfill based on the agreement entered into with the allottees, namely-stage-wise schedule of completion of the project and the services, claim timely possession of the apartment/plot, entitlement to necessary documents and plans etc.
91. If the registration of a real estate project is revoked for any reason, how will the interest of the buyer, in such project, be protected by Regulatory Authority?
Regulatory Authority will take action in accordance with section 8 of the Act.
92. In case of delay in getting possession from the promoter, will the buyer be entitled to get interest on the amount paid by him, for such delayed period?
Yes. In accordance with the Agreement for Sale as prescribed in Form-G, if the Promoter fails to abide by the time schedule for completing the project and handing over the [Apartment/Plot] to the Allottee, the Promoter agrees to pay to the Allottee, who does not intend to withdraw from the project, interest as specified in the Rules, on all the amounts paid by the Allottee, for every month of delay, till the handing over of the possession.
93. Will such interest payment by the promoter to the buyer be automatic or the buyer will have to approach Regulatory Authority?
The interest payment is in accordance with the Agreement for Sale and hence should be automatically paid. The buyer may have to file a complaint to Regulatory Authority if there is a grievance.
94. Is there a ceiling on the interest to be levied by the promoter in case of default in payment of any installments by the allottee?
In accordance with the Agreement for Sale, the Allottee has to pay to the Promoter, a rate of interest specified in rule 17 of the Rules. The rate of interest is equal to the State Bank of India highest Marginal Cost of Lending Rate plus two percent, on all the amounts which become due and payable by the Allottee to the Promoter under the terms of the Agreement for Sale from the date the said amount is payable by the allottee(s) to the Promoter.
95. What are the provisions for an aggrieved person to lodge a complaint before the Authority?
Section 31 of the Act and Rule 35 of Rajasthan Real Estate (Regulation and Development) Rules, 2017 provide for filing of complaint with Regulatory Authority, by an aggrieved person. The aggrieved person can file an application online as per Form-N prescribed under the Rules.
96. Does the Act also cover real estate agents?
Yes. Real estate agents who engage in selling projects registered under the Act can do so only after registering themselves with the Authority. Section 9 of the Act provides that no real estate agent shall facilitate the sale or purchase of any plot, apartment, or building in a real estate project or part of it, being sold by the promoter, without obtaining registration under section 9.
97. What are the duties and responsibilities of the real estate agents?
Section 10 of the Act provides for detailed functions and duties of real estate agents:
98. What is the manner for registration of real estate agents?
Real estate agents must apply for registration in Form-H to the Authority along with documents such as business details, photographs, PAN card, address proof, and others as specified by regulations. The registration fee is Rs. 10,000 for individuals or Rs. 50,000 for others.
99. For which period the registration of real estate agent shall be valid?
The registration granted to a real estate agent shall be valid for up to five years.
100. Can the registration of a real estate agent be renewed? What is the manner and fees for renewal?
Yes, the registration can be renewed by applying in Form-K, at least three months prior to expiration. The renewal fees are Rs. 5,000 for individuals and Rs. 25,000 for others, along with updated documents. The renewal is valid for five years.
101. Can the registration of a real estate agent be revoked?
Yes, registration may be revoked or suspended if the agent breaches conditions or misrepresents information. The agent will have the opportunity to be heard before revocation or suspension.
102. Is the registration of a real estate agent valid for a particular place or project?
The registration granted is valid for the entire State.
103. If the Authority does not respond to an application, is the agent deemed registered?
Yes, if no communication is received within 30 days, the real estate agent shall be deemed to be registered.
104. Will existing customers referring others to buy flats be treated as Real Estate Agents?
Yes, if they receive a consideration. Real estate agents are defined in Section 2(zm) of the Act.
105. For foreign brokers and advertisements outside India, will the same rules apply as in India?
Yes, the rules apply if the advertisement pertains to a registered project under the Regulatory Authority.
106. What is the procedure to obtain registration to operate as Real Estate Agents? What are the documents required to get a real estate agent's license?
It will be through an easy online process. The procedure is explained in Rule 10 & 11 of Rajasthan Real Estate (Regulation and Development) Rules 2017.
107. What is the fee for registration? What is the duration?
The fees are in accordance with Rule 10(3) of the Rajasthan Real Estate (Regulation and Development) Rules, 2017. The registration is valid for a period of five years.
108. Will marketing and sales staff of Builder/ Promoter/ Developer also need to take registration as an agent?
A real estate agent is clearly defined in Section 2(zm) of the Act.
109. Is the registration of a Real Estate Agent transferable to another agent or to another state where the agent intends to shift his office?
No, the registration is not transferable.
110. Even if a real estate agent has not taken any commission from the client and taken it from the promoter, can the agent still be responsible and liable for the builder’s default?
The agent's liability is in accordance with Section 10 of the Act. He is not held liable for the promoter's default.
111. Are the provisions of the Act protecting agents for their commissions not paid by the builder or parties to the deal?
No, these will be guided by the agreements that real estate agents have with the concerned promoters or allottees.
112. Will the agent be responsible until the delivery of flats/real estate units, or is he responsible until the documents are registered?
The responsibility of the real estate agent will be in accordance with Section 10 of the Act.
113. What are unfair trade practices of a Real Estate Agent?
It is explained in Section 10(c) of the Act.
114. What if the promoter gives false information or documents to the real estate agent, and the agent acts upon such information? Will he be liable?
Under Section 12 of the Act, it is the obligation of the promoter regarding the veracity of advertisements and prospectuses. The agent is liable if he makes a false or misleading representation concerning the services that he intends to offer.
115. Will listing websites, newspapers, or exhibitions promoting real estate need to take an agent’s license?
Yes, if they intend to facilitate the sale or purchase of or act on behalf of any person to facilitate the sale or purchase of any plot, apartment, or building in a registered real estate project being sold by the promoter in any planning area.
116. Will real estate agents putting advertisements on builders’ behalf need to get approval for their print, radio, TV, or other media promotions content?
No, however, no advertisement should be put out for a project unless the concerned promoter has registered the project with the Regulatory Authority. The agent should not advertise for services that are not intended to be offered.
117. Will a multi-state operator of a real estate agency business need to apply in all states of India?
For working as a real estate agent in Rajasthan, registration will be given by the Real Estate Regulatory Authority of Rajasthan.
118. Is the agent authorized to sign on behalf of his promoter/builder?
No, the agent is not authorized to sign on behalf of the promoter or builder.
119. Whether the regulatory authority for Rajasthan has been established?
Yes. As per section 20, the Regulatory Authority is required to be established by the State Government. For speedy implementation of the Act, the State Government has designated the Additional Chief Secretary, UDH Department as an interim Regulatory Authority until the establishment of the full-time Authority.
120. How are the Chairman and the Members of the Authority required to be appointed?
As per section 22, the Chairman and the Members of the Authority are required to be appointed by the State Government on the recommendations of a Selection Committee comprising the Chief Justice of the High Court (or his nominee), the Addl. Chief Secretary, UDH Dept., and the Principal Secretary Law Dept. The section also provides for the qualifications required for the appointment of the Chairman and the members.
121. What is the eligibility for the appointment of the Chairman and the Members of the Regulatory Authority?
As per section 22, the Chairperson should have adequate knowledge of and professional experience of at least 20 years, and the Members should have adequate knowledge of and professional experience of at least 15 years in urban development, housing, real estate development, infrastructure, economics, technical expertise from relevant fields, planning, law, commerce, accountancy, industry, management, social service, public affairs, or administration.
122. What are the important responsibilities of the Regulatory Authority?
Apart from the day-to-day implementation of the Act and the Rules and Regulations made thereunder, the immediate responsibilities of the Regulatory Authority are:
123. How can a complaint be filed with the Authority for any violations under the Act?
Section 31 of the Act provides for filing a complaint by an aggrieved person with the Regulatory Authority. Any aggrieved person may file a complaint in Form-N prescribed in the Rules. The complaint shall be accompanied by a fee of rupees 1000/-, to be paid through online mode of payment. The manner for filing the complaint has been specified in rule 35 of the Rules.
124. What is the time period within which the Authority is required to dispose of any matter that is brought to it for consideration?
Section 29 provides that the Authority should endeavor to dispose of the questions/complaints as expeditiously as possible, but not later than sixty days from the date of filing the same. However, if it could not be disposed of during the said period, the Authority is required to record its reasons for the delay.
125. Can a promoter or a real estate agent also file a complaint against a buyer?
Yes. An aggrieved person having any interest in the registered real estate project can file a complaint.
126. Where will the aggrieved home buyer be required to file his complaint?
The aggrieved person can file an application online as per prescribed Form-N, which is also provided on the Regulatory Authority website.
127. On what grounds can the home buyer file a complaint?
An aggrieved person may file a complaint with the Regulatory Authority for any violation or contravention of the provisions of the Act or the Rules or Regulations made thereunder.
128. Who would decide the complaints?
The Regulatory Authority shall decide complaints.
129. Is there any time limit prescribed for the promoter for formation of society or any other legal entity of home buyers?
The promoter has to enable the formation of an Association of Allottees like a Cooperative Society, Company, Association, Federation, etc. within three months from the date on which fifty-one percent of the total number of purchasers in such a building or wing have booked their apartment.
130. Can an allottee who has executed an agreement with the promoter prior to the ongoing project being registered with the Authority be a complainant before the Regulatory Authority?
The Regulatory Authority empowers any aggrieved person to file a complaint with respect to a registered real estate project. This will include an allottee who has an agreement executed before the ongoing project is registered with the Regulatory Authority. However, the Regulatory Authority will have authority to adjudicate for violations and contravention of provisions of the Real Estate (Regulation and Development) Act or rules and regulations made thereunder.
131. Whether the Real Estate Appellate Tribunal has been established under the Act?
As per section 43 of the Act, the Appellate Tribunal is required to be established by the State Government. For speedy implementation of the Act, section 43 empowers the State Government to designate an existing appellate Tribunal (under any other law in force) to function as an Appellate Tribunal under the Act. Accordingly, the State Government has designated the Food Safety Appellate Tribunal as the interim Real Estate Appellate Tribunal until the establishment of a permanent Real Estate Appellate Tribunal.
132. What are the important responsibilities of the Appellate Tribunal?
The Appellate Tribunal is a quasi-judicial body, which is empowered to hear appeals from the order/decisions/directions of the Regulatory Authority or the Adjudicating Officer, as the case may be. Every appeal shall be accompanied by a fee of rupees 5000/-, to be paid through online mode of payment. The appeal shall be filed in Form-M. The manner of filing an appeal and the manner for hearing and disposing of the appeal has been prescribed in rule 27 of the Rules.
133. Can an appeal be filed against the decision or the orders of the Appellate Tribunal?
Any person aggrieved by the decision or order of the Appellate Tribunal can file an appeal with the High Court.
134. What is the time period within which the Appellate Tribunal is required to dispose of the appeal?
Section 44 provides that the Appellate Tribunal should endeavor to dispose of the appeal as expeditiously as possible, but not later than sixty days from filing the appeal. However, if the appeal could not be disposed of during the said period, the Appellate Tribunal is required to record its reasons for the delay.
135. How are the Chairman and the Members of the Appellate Tribunal required to be appointed?
As per section 46, the Chairman of the Appellate Tribunal must be a sitting or retired judge of the High Court. Section 46 also provides that the Appellate Tribunal shall comprise at least two Members, one of whom shall be a judicial Member and the other shall be a Technical or Administrative Member.
As per section 46, the Members of the Appellate Tribunal are required to be appointed by the State Government on the recommendations of a Selection Committee comprising the Chief Justice of the High Court (or his nominee), the Additional Chief Secretary, UDH Department, and the Principal Secretary, Law Department. The section also provides for the qualifications required for the appointment of the Judicial/Administrative Members.
136. What is the punishment prescribed for non-registration of a project under the Act?
As per section 59, where under the Act, it is obligatory for the promoter to register a project with the Authority, and the promoter fails to do the same, he shall be liable to a penalty up to ten percent of the estimated cost of the real estate project. However, in case the promoter consistently defaults or does not comply with the directions/orders of the Authority regarding registration of the project with the Authority, he shall be liable to an additional fine of ten percent of the estimated cost of the real estate project or imprisonment up to 3 years or both.
137. What is the punishment prescribed for violation of section 4 which provides for application for registration of the project?
As per section 60, if the promoter defaults as regards matters covered under section 4, he shall be liable to a penalty up to five percent of the estimated cost of the real estate project.
138. What is the punishment prescribed for violation of other provisions of the Act by the promoter?
As per section 61, if the promoter defaults any other provision of the Act or the Rules and Regulations made thereunder, he shall be liable to a penalty up to five percent of the estimated cost of the real estate project.
139. What is the punishment prescribed for non-compliance of the orders of the Authority by the promoter?
As per section 63, if the promoter fails to comply with the order of the Authority, he shall be liable to a penalty for every day of default, which may cumulatively extend up to five percent of the estimated cost of the real estate project.
140. What is the punishment prescribed for non-compliance of the orders of the Appellate Tribunal by the promoter?
As per section 64, if the promoter fails to comply with the orders of the Appellate Tribunal, he shall be liable to a penalty for every day of default, which may cumulatively extend up to ten percent of the estimated cost of the real estate project or with imprisonment for a term which may extend up to three years or with both.
141. What is the punishment prescribed for non-registration by a real estate agent under the Act?
As per section 62, where under the Act, it is obligatory for the real estate agent to register himself with the Authority, and the real estate agent fails to do the same, he shall be liable to a penalty of rupees ten thousand per day of default, which may be cumulatively extended up to five percent of the cost of the plot/apartment/building for which the sale/purchase has been facilitated by him.
142. What is the punishment prescribed for non-compliance of order of the Authority by the real estate agent?
As per section 65, if the real estate agent fails to comply with the orders of the Authority, he shall be liable to a penalty for every day of default, which may be cumulatively extended up to five percent of the cost of the plot/apartment/building for which the sale has been facilitated by him.
143. What is the punishment prescribed for non-compliance of the orders of the Appellate Tribunal by the real estate agent?
As per section 66, if the real estate agent fails to comply with the order of the Appellate Tribunal, he shall be liable to a penalty for every day of default, which may be cumulatively extended up to ten percent of the cost of the plot/apartment/building for which the sale has been facilitated by him or with imprisonment for a term which may extend up to one year or with both.
144. What is the punishment prescribed for non-compliance of the orders of the Authority by the allottee?
As per section 67, if the allottee fails to comply with the orders of the Authority, he shall be liable to a penalty for every day of default, which may be cumulatively extended up to five percent of the cost of the plot/apartment/building.
145. What is the punishment prescribed for non-compliance of the orders of the Appellate Tribunal by the allottee?
As per section 68 if the allottee fails to comply with the orders of the Appellate Tribunal, he shall be liable to a penalty for every day of default, which may be cumulatively extended up to five percent of the cost of the plot/apartment/ building or with imprisonment for a term which may extend upto one year or with both.
146. Can an offence which provides for imprisonment be compounded?
As per section 70, if a person is punishable with imprisonment under the Act, the same may be compounded on such terms and conditions as prescribed in rule 34 of the Rules, which cannot be more than the maximum fine payable for that offence.
147. What is the role of the Adjudicating Officer?
The Adjudication Officer is a quasi-judicial person who is mandated to adjudicate on disputes arising under section 12, 14, 18, and section 19. The Adjudicating Officer shall be a person who is or has been a District Judge.
148. What are the factors that need to be taken into account by the Adjudicating Officer while deciding a dispute under sections 12, 14, 18, and 19 of the Act?
The Adjudicating Officer shall, while deciding the disputes under section 12, 14, 18, and 19 of the Act, have regard to the amount of disproportionate gain or unfair advantage, the amount of loss, repetitive nature of the default, and such other factors that the Adjudicating Officer may consider necessary in furtherance of justice.
149. What is the mechanism to finance the functioning of the Authority?
The State Government may, through due appropriation, make grants to the Authority.
150. Who is required to constitute the Real Estate Regulatory Fund?
The State Government is required to constitute the Real Estate Regulatory Fund, which is to be administered by a committee of such Members of the Authority as may be determined by the Chairperson.
151. What are the purposes for which the Real Estate Regulatory Fund is supposed to be used?
The said Fund is required to be used towards payment of salary and allowances to the Chairperson and the Members of the Authority and the Appellate Tribunal, and such other expenses of the Authority in connection with the functions and purposes specified under the Act.
152. What are the sources of the Real Estate Regulatory Fund?
The following shall be credited to the Real Estate Regulatory Fund:
a) All Government grants received by the Authority,
b) The fees received under the Act, and
c) The interest accrued on the amounts (a) + (b).
153. Can the penalties imposed under the Act be deposited in the Real Estate Regulatory Fund?
As per section 76, penalties recovered under the Act are to be deposited in such account as may be specified by the State Government in the Finance Department.
154. Is the Authority required to prepare a budget and maintain proper accounts and other relevant records? Are the accounts of the Authority required to be audited?
As per section 77, the Authority is required to prepare a budget, maintain proper accounts
and other relevant records, and also prepare an annual statement of accounts in the manner
prescribed in rule 37 of the Rules. The annual statement of accounts shall be prepared in
Form-P prescribed in the Rules.
In addition, section 77 provides that the accounts of the Authority are required to be
audited by the Comptroller and Auditor General of India.
The accounts of the Authority, as certified by the CAG, together with the audit report,
are required to be forwarded annually to the State Government by the Authority, and the
State Government shall cause it to be laid before the State Legislature.
155. Is the Authority required to prepare an Annual Report?
As per section 78, the Authority is required to prepare an Annual Report in the manner
prescribed in rule 38 of the Rules. The annual report shall be prepared by the Authority in
Form-Q as prescribed in the Rules.
In addition, the said Annual Report is required to be forwarded to the State Government
for it to be laid before the State Legislature.
156. Are the civil courts and consumer forums barred from entertaining disputes under the Act?
As per section 79 of the Act, civil courts are barred from entertaining disputes (suits or
proceedings) in respect of matters which the Authority, the adjudicating officer, or the
Appellate Tribunal is empowered under the Act to determine. However, the consumer forums
(National, State, or District) have not been barred from the ambit of the Act.
Section 71 proviso permits the complainant to withdraw his complaint as regards matters
under section 12, 14, 18, and section 19 from the consumer forum and file it with the
adjudicating officer appointed under the Act.
157. Can a complainant approach both the Regulatory Authority/adjudicating officer and the consumer forums for the same disputes?
The laws of the country do not permit forum shopping. Thus, an aggrieved person can only approach one of the two for disputes over the same matter.
158. Can the Authority delegate any of its functions under the Act?
As per section 81, the Authority is empowered to delegate such of its powers and functions under the Act to any Member, officer, or any other person, subject to conditions specified in the order issued for the same. However, the Authority cannot delegate the responsibility of making Regulations under section 85 of the Act.
159. Has the Authority notified the Regulations under the Act?
As per section 85 of the Act, Regulations are required to be notified by the Regulatory Authority within 3 months of its establishment.
160. Are the Rules, Regulations, etc., notified required to be laid before the Parliament or the State Legislature?
As per section 86, every Rule, Regulation, or notification issued by the appropriate Government or the Authority is required to be laid before the Parliament or the State Legislature, as the case may be.
161. Does the Government have the power to issue orders towards Removal of difficulties while implementing the Act?
The Central Government, under section 91, has been empowered to notify orders towards removal of difficulties while implementing the Act. However, such removal of difficulties order cannot be issued after the expiry of a period of two years since its commencement. The Central Government, vide its notification dated 28.10.2016, has issued such an order, namely, "the Real Estate (Regulation and Development) Removal of Difficulties Order, 2016," which has been published in the Gazette of India on 28.10.2016.
162. What is the composition of the Central Advisory Council?
The Central Advisory Council, to be headed by the Union Minister for Housing, is a
multi-member body comprising of representatives from specified Central Ministers, five
representatives of State Governments to be selected by rotation, five representatives of
Regulatory Authorities to be selected by rotation, and any other central government
department as notified.
The Central Advisory Council is also required to have representatives of consumers, the
real estate industry, real estate agents, construction laborers, NGOs, and academic/research
institutions.
163. What is the role and responsibility of the Central Advisory Council?
The Central Advisory Council is required to advise the Central Government on matters relating to the implementation of the Act, questions of policy, protection of consumer interest, fostering growth and development of the real estate sector, and other matters as may be assigned to it by the Central Government.
