Track2Realty: The Cabinet on Tuesday, June 4, cleared the Real Estate (Regulation and Development) Draft Bill, aimed at organising and monitoring the sector.
The draft, which has to be passed in parliament, is expected to protect buyers from erring developers and usher in an era of transparency through a regulatory process.
The draft bill, which has been in the making for about five years now, makes it mandatory for developers to launch projects only after acquiring all the statutory clearances from relevant authorities.
Besides, it has certain tough provisions to deter builders from putting out misleading advertisements related to the projects carrying photographs of actual site. Failure to do so for the first time would attract a penalty which may be up to 10% of the project cost and a repeat offence could land the developer in jail for a maximum of three years.
It also aims to make it mandatory for a developer to maintain a separate bank account for every project to ensure that the money raised for a particular task is not diverted elsewhere.
It would provide for a clear definition of the ‘carpet area’ and would prohibit private developers from selling houses or flats on the basis of ambiguous ‘super area’.
Currently, the sector is not regulated. The draft Bill by Ministry of Housing and Urban Poverty Alleviation (HUPA) is expected to ensure sale of immovable properties in an efficient and transparent manner and protect the interest of consumers. It also seeks to establish an Appellate Tribunal to adjudicate disputes and hear appeals from the decisions or orders of the Authority.
Anil Kumar Sharma, President, CREDAI-NCR said, “We welcome the thought of Government on bringing the bill but we are not willing to accept it in its current form. We have been opposing the bill in its current form from the beginning. We are disappointed with the way government is going ahead without addressing our concerns. According to us, said bill is neither benefitting the Consumers nor other stake holders.”
The industry has been opposing the bill and the draft has been revised various times since 2009, when it was first draft was made.
