The Real Estate (Regulation and Development) Bill has been passed by the Rajya Sabha. The Bill had been introduced by the earlier government in 2013. The first draft had been rejected last year by the Rajya Sabha, with Opposition leaders saying it favoured developers and did not serve the interests of consumers.
In its current form, the Bill aims to protect the interest of consumers, promote fair play in real estate transactions and ensure timely execution of projects.
The Bill provides a uniform regulatory environment to ensure speedy adjudication of disputes and promote orderly growth of the real estate sector. It will boost domestic and foreign investment in the real estate sector and help achieve the objective of the Government of India to provide ‘Housing for All’ by enhanced private participation. The Bill provides for establishment of a ‘Real Estate Regulatory Authority’ in States/Union Territories to regulate real estate transactions. This will help the real estate sector, which is not organised in its functioning. The Real Estate Regulation Authority will help regulate both commercial and commercial products. Registration of real estate projects and real estate agents will also rest with the Authority.
The Bill will make disclosure mandatory for all registered projects, including details of the promoter, project, layout plan, land status, approvals and agreements along with details of real estate agents, contractors, architects, structural engineers, etc.
Builders will have to deposit a specified amount in a separate bank account to cover the construction cost of a project for timely completion of the same.
Fast track dispute resolution mechanisms will be established for settlement of disputes, through adjudicating officers and an Appellate Tribunal. Civil courts will be prohibited from taking up matters defined in the Bill. However, consumer courts will be allowed to hear real estate matters.
Promoters will be barred from changing plans and design of projects without the consent of consumers.
Further, the Bill will disallow any discrimination against home buyers based on the basis of religion, region, caste, creed or sex and gender.
Providing a shield for home buyers, builders cannot escape their liability while putting up flashy designs or photographs of a project. Builders have to return payment with interest to buyers who are affected by incorrect, fast statements contained in a notice, advertisement or prospectus or a model apartment, plot or building. The Real Estate Regulation Authority can order compensation to consumers in case of misleading advertisements.