If they do not get registered with us then we have got enough or more power to take action against them under section 59 and 61 of the Act.
The Real Estate (Regulation and Development) Act protects the interests of home buyers and sets rules for the sector. Anand Kumar, chairman of the Delhi Real Estate Regulatory Authority (RERA), told Namrata Kohli in an interview how the system works. RERA registration is like insurance for homebuyers, he said.
Here are edited excerpts from the interview.
You have brought nearly every important stakeholder under the ambit of RERA, be it the builder, the project, the broker. But the buck actually stops with the development authorities. Shouldn’t they be held accountable and register with RERA?
Anybody who is into the real estate development sector, whether it’s a development authority like Delhi Development Authority (DDA) or Delhi State Industrial and Infrastructure Development Corporation Ltd (DSIDC), or any other such organisation. If they are doing plotted development or if they are doing real estate projects, as per section 3, they must get registered with us. And if they do not get registered with us then we have got enough of more power to take action against them under section 59 and 61 of the Act.
In fact, we have given our orders and judgement asking DDA to register with us and DDA has gone and appealed against our order. Even if you are building flats from your own funds, what is the end purpose? Is DDA going to keep these flats for themselves? The answer is ‘No’. After they complete the building, they are going to sell these flats to the end users i.e., the buyers. Now if DDA delays the project, if the cost escalates, who is going to suffer, the buyer. So, keeping that thing in mind and moreover anybody who hands over a building or apartment, he is responsible to maintain the quality for 5 years, as per the RERA Act. Considering all these DDA must register all their projects with us. So, we have said so in very clear terms and our order is on the website. The development authorities must own it up, own up their responsibilities
We are even telling DDA if you have conceived a real estate scheme, be it commercial or residential or office, please take all the approvals, in advance and common clearances for these projects such as from the Delhi Jal Board (DJB), environmental clearances, sewerage, Delhi Urban Arts Commission (DUAC) so that individual builder is not running after those approvals.
Why has Delhi RERA made it mandatory to register real estate projects constructed on more than 500 sq m or 8 units?
The GoI (government of India), in their wisdom and rightly so, decided that the large projects should come under the purview of RERA. This is because large projects affect the people at large. Again, in their wisdom since the conditions vary from state to state and UT to UT, they gave the powers to appropriate governments to redefine the size of projects which would require RERA. So, what is the case with Delhi? What qualifies to be registered under Rera are either one of these two things. One, all those real estate projects which come up on a plot size of more than 500 sq m are included. Even if you construct two floors or four floors or you make four shops, the moment the 500 sq m exceeds and it can be even 501 sq m, you have to come to RERA and register your project.
Registering your project is not expensive – it just costs a few thousand rupees and not even lakhs. Two, irrespective of the plot size, if the number of units to be constructed on the plot is eight or more, it needs to be registered. Rera Act defines apartment as a flat or floor or shop or any sort of a unit enclosed by four walls- the moment you have any development with 8 units, whether it is on 100 or 200 sq m plot, be it apartments, shops, enclosed spaces, it must also be registered with RERA. Irrespective of the plot size, the number of allotees affected are more in number.
On the RERA website there are more rejected applications than selected ones, whether it’s for projects or brokers. Any suggestions for stakeholders before they register?
If all the papers have been submitted as per the checklist, the RERA approval will be given within two weeks. We have set a deadline of 30 days, within this deadline we either register a project or communicate the deficiency, so far this deadline has never been breached. Usually, there are a whole lot of incomplete applications that come to us. Often the documents are missing.
RERA is not a draconian thing and takes care of all stakeholders: buyers, builders, brokers or real estate agents. It is written clearly what are the responsibilities of the three stakeholders and how they should behave. I would request everyone especially the promoters to go through all sections related to what are the duties of builders, brokers, buyers. Don’t depend on your managers. If you depend on managers, you are in trouble. They will not have the interest what promoter has. As a stakeholder, you must read the fineprint and have first hand knowledge of what you are expected to do. We welcome all suggestions and concerns of the promoters and other stakeholders. They can write to us wherever and whenever they face issues in registration of projects or any other requirements. We have also started the work on RERA website upgradation to remove any glitches. We have kept Tuesday 4-5 pm for meeting up with anyone who has any doubts. My biggest fear is that the project should not fail.
How do you wish to bring more efficiency into the real estate sector?
In many cases we have observed that a project registered with RERA is more in demand and commands a premium. Even if a developer doesn’t care about his allottees or buyers, he should register for his own sake. I know of a medium sized builder who refused to register but on his own, came back later seeing the huge benefit of RERA registration. Developers must understand the importance of registering the builder buyer agreement under the general agreement on a INR 100 rupee stamp paper for better protection of both parties and the importance of strictly following 70% funds collected from buyers to be kept in an escrow account. A heavy penalty will be levied on projects which try to escape RERA registration.
The home buyers should also opt for RERA-registered projects. After all we are here in the interest of the buyers—RERA registration is like insurance for the homebuyer.