Real Estate (Regulation and Development) Act, 2016

May 21, 202212411 0

This article is written by Akshaya V, pursuing LLB from

CMR University, School of Legal Studies. This article is
an effort to simplify the concept and working of the Real
Estate (Regulation and Development) Act, 2016 through
the coverage of important provisions and stipulations
including an analysis of the Act.

It has been published by Rachit Garg.

Table of Contents

Introduction
History of the Real Estate (Regulation and
Development) Act, 2016
Scope and applicability of the Real Estate (Regulation
and Development) Act, 2016
Need for the Real Estate (Regulation and Development)
Act, 2016
Importance of the Real Estate (Regulation and
Development) Act, 2016
Salient features of the Real Estate (Regulation and
Development) Act, 2016
An overview of the Real Estate (Regulation and
Development) Act, 2016
Important definitions under (Section 2)
Responsibilities of the appropriate Government
Projects exempt from the ambit of the Real Estate
(Regulation and Development) Act, 2016
Application for registration of real estate projects
(Section 4)
Granting of registration by the authority (Section 5)
Extension of registration (Section 6)
Revocation of registration (Section 7)
Lapse on the revocation of registration (Section 8)
Registration of real estate agents (Section 9)
Promoter (Section 12)
Establishment and incorporation of Real Estate
Regulatory Authority (Section 20)
Establishment of Central Advisory Council (Section 41)
Functions of Central Advisory Council (Section 42)
Analysis of the effectiveness of the council
The Real Estate Appellate Tribunal
Establishment of Real Estate Appellate Tribunal
(Section 43)
Application for settlement of disputes and appeals to
Appellate Tribunal (Section 44)
Qualifications for appointment of the Chairperson and
members (Section 46)
Term of office of the Chairperson and members (Section
47)
Powers of the Appellate Tribunal (Section 53)
Role of High Courts (Section 58)
Power to make regulations (Section 85)
Penal provisions under RERA
Analysis of the Real Estate (Regulation and
Development) Act, 2016
Advantages of RERA for the buyers
Advantages of RERA for builders
Disadvantages of RERA
Impact of the Real Estate (Regulation and Development)
Act, 2016 on the industry
The economic impact of RERA on the industry
Lacunas in the RERA Act
Key challenges of the Real Estate (Regulation and
Development) Act, 2016
Current issues in India in relation to the Real Estate
(Regulation and Development) Act, 2016
Analysis of the establishment of the tribunals
Judicial insights
Geetanjali Aman Constructions v. Hrishikesh Ramesh
Paranjpe
Mr. Jatin Mavani v. M/s. Rare Township Pvt. Ltd, 2018
Sushil Ansal v. Ashok Tripathi, Saurab Tripathi, 2020
Baldev Singh v. Ultratech Township Developers Pvt
Limited, 2020
Conclusion
References
Introduction
The real estate sector is an important component of the
economy and plays a catalytic role in meeting the
country’s housing and infrastructure needs and
demands. While this sector has grown significantly in
recent years, it has been largely under-regulated with
the absence of standardisation and lack of adequate
buyer protection. Though the Consumer Protection Act
of 2019 provides a forum for real estate buyers to
address their concerns, the option is only curative and
does not adequately address all the problems of buyers
and promoters in that sector. The absence of uniformity
has been a constraint to the healthy and orderly growth
of the industry. Therefore, the need for regulating the
sector has been accentuated in various forums.

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History of the Real Estate (Regulation and
Development) Act, 2016
The real estate sector was struggling as there were no
rigid laws governing the same. The need of the hour was
to appoint a comprehensive regulatory body to govern
the same. The 2009 conference of National Housing
Development and Municipal Administration Ministers
discussed affordable housing for all including land-use
policies, financial strengthening of local public bodies
and a road map for hovel free cities. To address the
issues of land valuation system and urban development
regulation, the discussion also included the creation of a
draft Real Estate bill by the Ministry of Housing and
Urban Poverty Alleviation. In July 2011, the Ministry of
Law and Justice suggested that the legislation is part of
the concurrent list of the Indian Constitution. Later, on
14 August 2013, the Real Estate (Regulation and
Development) Bill was introduced in Rajya Sabha. The
Union Cabinet approved twenty substantial
Amendments to the bill in December 2015, based on
Rajya Sabha Committee recommendations. The law was
then passed by the Rajya Sabha on March 10, 2016, and
the Lok Sabha on March 15, 2016. The Parliament
enacted the Real Estate (Regulation and Development)
Act, 2016, herein referred to as the RERA Act, which
aims to protect the rights and interests of consumers by
minimising the malpractices done by the developers and
promoting uniformity business practices and
transactions in the real estate sector. The RERA Act
came into effect on and from 1 May, 2016. At the time of
passing of the Act, only 69 out of 90 Sections were
notified and all other provisions were effective on and
from 1 May 2017. On 31st October 2016, the centre,
through the Housing & Urban Poverty Alleviation
Ministry, released the general rules of the Real Estate
(Regulation and Development) Act, 2016. The Act was
legislated under entry 6 and entry 7 of the concurrent
list of the Indian Constitution.

Scope and applicability of the Real Estate (Regulation

and Development) Act, 2016
The Real Estate (Regulation and Development) Act
2016, hereinbelow referred to as the ‘Act’ applies to the
whole of India except Jammu and Kashmir. Provisions
of the RERA Act apply to residential apartments,
buildings and plots whether residential or commercial.
The Real Estate Project defined in the Act includes the
development of buildings consisting of apartments,
converting existing buildings into apartments and
developing land into plots for the sale of all or some of
the said apartments to carry out the purpose of this Act.
Under RERA Act, it is mandatory to register all projects
of more than five hundred square metres. The main
aspects covered by the RERA Act include all project-
related information, contract documents for buying and
selling properties, carpet area stipulation, limitation of
an advance fee to ten per cent of the apartment a deposit
of seventy per cent of the money collected from the
buyers in the escrow account, timely completion of the
project and penal provisions. Hence, it is imperative to
note that the RERA Act is one such comprehensive Act
which covers all the projects mentioned above
irrespective of whether it is commercial or residential.

Need for the Real Estate (Regulation and Development)

Act, 2016
To control and regulate the real estate sectors by
shutting out malpractices;
To keep consumers out of perils such as delayed
delivery, transfer of title of the property, the quality of
amenities provided and necessary changes to be made
etc., before purchase;
To appoint authorities to manage the real estate sector
and to establish an Appellate Tribunal for each State. To
enable home buyers to file complaints in case of any
wrongdoing committed by the builders or developers;
To contribute a good percentage to India’s GDP;
To create accountability and responsibility for the
authorities so appointed;
To tighten the security on the use of investments done
by the home buyers or investors;
To have a supreme authorisation on the registration for
the projects required to be registered; and
To maintain quality in delivering the project to the
buyers as per their interest and give scope for
complaints to the authorities in case of any structural
defects.
Importance of the Real Estate (Regulation and
Development) Act, 2016
Real estate’s working was previously unregulated. The
enforcement of RERA intends to protect the buyers or
investors and in turn boost their confidence. It requires
transparency and authority to keep track of its
functioning approach. In reality, it now serves as a
spotless ground for buyers as well as reducing the risk of
those buyers or investors who bought or invested in the
real estate before the implementation of the Act. The Act
clarifies the relationship between property buyers and
developers. It lays down the process of establishing trust
between suppliers and purchasers. It has even created a
state agency to oversee real estate and business
transactions. The RERA Act is now assisting home
buyers in receiving their real estate projects on schedule
which is a huge comfort for Indian homebuyers.
Salient features of the Real Estate (Regulation and
Development) Act, 2016
To regulate and promote the real estate sector by
establishing the Real Estate Regulatory Authority.
To carry out the sale of plots, buildings or apartments as
the case may be, or the sale of all the real estate projects
transparently and efficiently.
To protect the interests of the consumers and buyers and
ensure the prevention of malpractices against them.
To establish adequate and speedy dispute redressal
systems and also establish Appellate Tribunals to hear
and adjudge appeals from the orders, directions or
decisions of the Real Estate Regulatory Authority.
Establishes state-level regulatory authorities called
RERA.
To work on residential real estate projects and register
all the projects that are to be undertaken without which
the promoters cannot promote or sell.
To cast duties on the promoters to upload details of the
project on the website including layout and site plans.
To ensure that two-thirds of the allottees give their
written consent in addition to RERA’s written approval
when a promoter has to transfer or assign a majority of
the rights and responsibilities in a real estate project to a
third party.
To ensure that the buyer or promoter, as the case may
be, pays an equal sum in the event of any default.
Where the promoter causes the buyer any loss as a result
of other people claiming property (defective title of
property) that has been built or is being built, the
promoter shall be liable to pay compensation to the
buyer.
To ensure that the money collected from project buyers
must be kept in a separate bank account and utilised
solely for the construction of the project. This sum is
subject to change by the State Government.
The Act provides the right to legal representation on
behalf of the client by a CA, CS or CMA or legal
practitioners
It imposes a stringent penalty on promoters, and real
estate agents and also prescribes imprisonment.
new legal draft
An overview of the Real Estate (Regulation and
Development) Act, 2016
State-level regulatory authorities (Section 20) – Real
Estate Regulatory Authority (RERA): The Real Estate
Regulatory Authority (RERA) is established at the state
level. The Act allows state governments to create
multiple regulatory authorities, each with the following
mandate:
Register and maintain a database of real estate
developments and make it available for public
inspection on the company’s website;
Protection of interests of promoters, real estate agents,
and buyers;
A housing development that is both sustainable and
affordable; and
Provide advice to the government and ensure adherence
to the Act and its regulations.
Real Estate Appellate Tribunal (Section 43) – The
decision of the Real Estate Regulatory Authorities can be
appealed to the tribunals established for each state
under the Act including its composition, application for
settlement of the dispute, qualifications for chairperson
and members, powers of tribunal and vacancies of the
Appellate Tribunal.
Mandatory Registration (Section 3) – Regulatory
Authorities require all projects with a plot size of at least
500 square metres or eight flats to be registered.
Deposits – Placing 70% of the monies accumulated from
the buyer shall be deposited in a separate escrow
account dedicated solely for the construction of that
project.
Penal interest on default (Section 61) – Both the
promoter and the buyer are responsible to pay an equal
rate of interest in the event of either party’s default.
Ceiling on advance payments (Section 13) – Without
initially entering into a sale agreement, a promoter
cannot receive more than 10% of the cost of the plot,
apartment, or building as an advance payment or an
application fee from a person.
Punishment (Section 66) – For violations of orders of
Appellate Tribunals and Regulatory Authorities,
developers can face up to three years in prison while
agents and buyers can face up to one year in prison or a
fine for every day during which the default continues,
which may extend cumulatively extend up to ten per
cent of the estimated cost of the plot, apartment or
building of the real estate project.
Important definitions under (Section 2)
Appropriate Government [Section 2(g)] – “Appropriate
government” means in respect of matters relating to,—
the Union territory without Legislature, the Central
Government,
the Union Territory of Puducherry, the Union territory
Government,
the Union Territory of Delhi, the Central Ministry of
Urban Development, and
the State, the State Government.
Appellate Tribunal [Section 2(f)] – “Appellate Tribunal ”
means the Real Estate Appellate Tribunal established
under Section 43.
Person [Section 2(zg)] – “Person” includes,—
an individual,
a Hindu undivided family,
a company,
a firm under The Indian Partnership Act, 1932 or The
Limited Liability Partnership Act, 2008, as the case may
be,
a competent authority,
an association of persons or a body of individuals
whether incorporated or not,
a co-operative society registered under any law relating
to co-operative societies, and
any such other entity as the appropriate Government
may, by notification, specify on this behalf.
Planning area [Section 2(zh)] – “Planning area” means a
planning area or a development area or a local planning
area or a regional development plan area, by whatever
name called, or any other area specified as such by the
appropriate government or any competent authority and
includes any area designated by the appropriate
government or the competent authority to be a planning
area for future the planned development, under the law
relating to town and country planning for the time being
in force and as revised from time to time.
5. Promoter [Section 2(zk)] – “promoter” means,—
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
a person who develops land into a project, whether or
not the person also constructs structures on any of the
plots, to sell to other persons all or some of the plots in
the said project, whether with or without structures
thereon, or
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
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
any other person who acts 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
such other person who constructs any building or
apartment for sale to the general public.
Real Estate Agent [Section 2(zm)] – “real estate agent”
means any person, who negotiates or acts on behalf of
one person in a transaction of transfer of his plot,
apartment or building, as the case may be, in a real
estate project, by way of sale, with another person or
transfer of a plot, apartment or building, as the case may
be, of any other person to him and receives
remuneration or fees or any other charges for his
services whether as a commission or otherwise and
includes a person who introduces, through any medium,
prospective buyers and sellers to each other for
negotiation for sale or purchase of plot, apartment or
building, as the case may be, and includes property
dealers, brokers, middlemen by whatever name called.
Responsibilities of the appropriate Government
Notify the rules for the implementation of this Act,
within six months of commencement of this Act
Establish the Real Estate Regulatory Authority, within
one year of commencement of this Act, ie., latest by 30th
April 2017.
Shall depute an officer, preferably, a housing secretary
as an interim regulatory Authority
Establish the Appellate Tribunals within one year from
its commencement, ie. , maximum by 30th April 2017.
Identify an existing Appellate Tribunal for the time
being established under any other law in force, as the
Appellate Tribunal until a full-time Appellate Tribunal is
established.
Appoint members of the Appellate Tribunal and the
Chairperson and members of the Regulatory Authority
based on the suggestions and recommendations of the
Selection Committee.
Appoint employees and other officers of the Regulatory
Authority and the Appellate Tribunal.
Identify and establish office space and other
infrastructure for its functioning.
To constitute the Real Estate Regulatory Fund, 2017.
The Central Government is required to establish the
Central Advisory Council.
Projects exempt from the ambit of the Real Estate
(Regulation and Development) Act, 2016
The following projects do not require to be registered
under the Act when:

the area of land does not exceed 500 sq. metres;

the number of apartments does not exceed eight.
In the case of renovation or repair or re-development:
where the area of land proposed to be developed does
not exceed 500 square metres 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 before commencement of this
Act;
For renovation or repair or re-development which does
not involve marketing, advertising, selling or new
allotment of any apartment, plot or building, as the case
may be, under the real estate project.
Application for registration of real estate projects
(Section 4)
Every promoter must submit an application to the
Authority for registration of the real estate project in the
form, manner, and time stipulated by the regulation of
the Authority along with the fee specified by the
Authority.

Step 1: An application has to be filed along with the fee

and other documents in the prescribed form for
registration with RERA by the applicants.

Step 2: The approval or rejection of the application for

registration shall be done within thirty days from the
date of receiving the application by the Authority.
Step 3: The promoter of the project shall be provided
with a registration number, user ID for login and
password for the applicant on successful registration.

Granting of registration by the authority (Section 5)

The authority, shall within thirty days from the date of
receipt of the application –
Grant registration of the real estate project subject to the
provisions of the Act and issue the applicant a
registration number, as well as a Login Id and password,
to enable him to access the website of the Authority and
create his web page to fill in the details of the proposed
project; or
Reject the registration by rejecting the application if it
does not conform to the provisions of the Act and record
reasons in writing.
Provided applications cannot be rejected without giving
an opportunity of being heard to the applicant.

As per sub-section (1), if the authority does not register

the project within thirty days, then the project is deemed
to be registered and the promoter shall be given the user
ID for login and password for accessing the RERA
website and to create his website for uploading the
details of the proposed project.
The registration so granted under this section is valid for
the time specified by the promoter in section 4 under
sub-clause (c) for the completion of the project.
Extension of registration (Section 6)
There has been a major delay in handing over the project
to the buyers by the developers. The Act was
promulgated to avoid such delays. Hence, the developer,
at the time of registration should specify a timeline
during which the project will be handed over to the
buyer.
The specification of the timeline is very important
because if the project is not handed over within the said
time, it may be usurped by the regulator and be revoked.
Under this Section, the discretion solely lies with the
regulator to grant an extension of registration.
The regulatory authority may take into account the force
majeure conditions or any reasonable circumstance to
merit the extension.
The promoter shall make an application detailing the
force majeure or the reasonable circumstances which
resulted in the delay in such form and by paying the
prescribed fee as the regulatory Authority may specify
from time to time.
Revocation of registration (Section 7)
The Authority may revoke the registration granted under
Section 5 after being satisfied that –
the promoter fails to do anything required by or under
this Act or the rules or regulations made thereunder,
the promoter violates any of the terms or conditions of
the competent authority’s approval,
the promoter is involved in any unfair practices or
irregularities.
The authority, upon the revocation of the registration –

Debar the promoter and his access to the website with

regard to the project he undertook and put his name
under the list of defaulters and display his photograph
on the website. He shall also inform the other Real
Estate Authorities in other States and Union Territories
about the revocation so made.

Lapse on the revocation of registration (Section 8)

When a registration expires or is revoked under this Act,
the Authority may consult with the appropriate
government to take whatever action it deems
appropriate, including completing the remaining
development works by a competent authority or an
association of allottees, as determined by the Authority.
As per the provisions of the Act, the orders, decisions or
directions given by the Authority shall not take effect
until the period of appeal expires. Where the project is
revoked under this Act, the association of allottees will
have a preferential right of refusal for proceeding with
the remaining development works.

Registration of real estate agents (Section 9)

Real estate broking is one of the easiest businesses in
India as there are no specific qualifications or experience
requirements. Before the onset of RERA, there was no
code of practice that set accountability, transparency
and professional benchmarks. As we see, in many parts
of the country, many non-professional agents or brokers
operate without a sense of accountability. Thus, the
RERA Act also covers agents who have to mandatorily
register under Section 9, without which a real estate
agent or broker cannot facilitate the sale or purchase of
any building, plot, or apartment as part of a registered
real estate project sold by the promoter in any of the
planning areas. Every real estate agent willing to act as
one shall apply to the Authority within a prescribed time
and in such form and such fee as to be prescribed. The
Authority, once satisfied that the provisions of the Act in
relation to the agent’s registration shall –

provide the real estate agent with a single registration

number,
 reject the application in case it does not conform with
the provisions of the Act or the rules thereunder with
reasons recorded in writing.
Provided that no application shall be denied until the
applicant has been allowed to be heard on the issue. The
applicant shall be given a reasonable opportunity of
being heard in the matter, without which the application
cannot be rejected.

Promoter (Section 12)

No deposit or advance is to be taken by the promoter
without first entering into the agreement for sale
(Section 13) – A promoter may not accept an advance
payment or application fee from a person over ten per
cent of the cost of the apartment, plot, or building
without first entering into an agreement for sale and
registering it.

Structural defect – In case of any structural defect,

workmanship defect, quality of delivery, or any
provision related to service, or any duty of the promoter,
as the case may be, under the agreement for the sale
relating to such development, must be brought to the
notice of the promoter within five years of the date of
handing over possession by the allottee. The promoter is
required to rectify such deficiencies without charge
within thirty days and in the event of the promoter
failing to do so within that period, the aggrieved
allottees are entitled to receive suitable compensation in
the manner stipulated under the Act.

Obligations of the promoter in case of transfer of a real

estate project to a third party (Section 15) – The
promoter may not transfer or assign his majority rights
and liabilities in a real estate project to a third party
without the prior written consent of two-thirds of
allottees, excluding the promoter, and without the
Authority’s prior written approval: Provided that such
transfer or assignment shall not affect the erstwhile
promoter’s allotment or sale of apartments, plots, or
buildings in the real estate project.

Obligations of promoter regarding the insurance of real

estate project (Section 16) – The promoter shall secure
all insurances that may be required by the competent
government, including but not limited to insurance in
respect of –

Title to the land and buildings that are part of the real
estate project; and
Real estate project construction.
Transfer of title (Section 17) – In a real estate project,
the promoter shall execute a registered conveyance deed
in favour of the allottee and hand over the physical
possession of the plot, apartment, or building, as the
case may be, to the allottees, as well as the undivided
proportionate title in the common areas to the
association of the allottees or the competent authority,
as the case may be and hand over the common areas to
the association of the allottees or the competent
authority. The promoter is bound to comply with the
direction of the competent authority, as the case may be,
under this provision within three months from the date
of issuance of the occupation certificate.

After obtaining the said occupation certificate and

transferring physical possession to the allottees, the
promoter is entrusted with the duty to hand over the
necessary plans and documents including common areas
to the allottees’ association or the competent authority
as applicable in accordance with the local laws. Where
there are no local laws in place, the promoter shall,
within thirty days of receiving the completion certificate,
hand over all essential documentation and plans
including common areas, to the allottees’ association or
the appropriate government, as the case may be.

Return of amount and compensation (Section 18)

If the promoter fails to complete or is unable to give
possession of an apartment, plot, or building:

In accordance with the terms of the agreement for sale

or by the date specified therein; and
Due to discontinuance of his business as a developer due
to suspension or revocation of the registration under
this Act or for any other reason, he shall be liable on
demand to the allottees, in case the allottee wishes to
withdraw.
He shall be liable to the allottees on-demand, without
prejudice to any other remedy available, to refund the
amount received by him in respect of that plot,
apartment, building or structure, as the case may be,
with interest at such rates and compensation as may be
prescribed under this Act.

Establishment and incorporation of Real Estate

Regulatory Authority (Section 20)
Within one year of the date of enactment of this Act, the
competent government shall, by notification, create a
body to be known as the Real Estate Regulatory
Authority to exercise the authorities conferred on it and
perform the responsibilities assigned to it under this Act.
Provided that the appropriate government of two or
more states or union territories may, if it so chooses,
establish a single authority, provided the relevant
government may, if it so desires, establish multiple
authorities in a state or union territory:

Provided that until a regulatory authority is established

under this Section, the competent government may by
order nominate any regulatory authority or any officers,
preferably the Secretary of the department dealing with
housing as the regulatory authority to discharge the
functions under the Act.

Term of office of the Chairperson and members (Section

23)

The Chairperson and Members shall serve for a term of

five years from the date of their appointment or until
they reach the age of sixty-five years, whichever is earlier
and shall not be eligible for re-appointment. Before
selecting anybody as a Chairperson or member, the
competent government must be satisfied that the person
has no financial or other interests that might jeopardise
his or her duties as a member.
Removal of the Chairperson and members from office in
certain circumstances (Section 26)

In accordance with the notified procedure under this

Act, the appropriate government shall remove the
Chairperson or other members from office if either of
them –
has been declared adjudged insolvent,
has been convicted of an offence involving moral
turpitude, or
has become incapable, either physically or mentally to
act as a member, or
has got any financial or other interest which may
prejudice exercising his power as Chairman or other
members.
The Chairperson or member shall not be removed from
office for the reasons specified in clauses (d) or (e) of
sub-section (1) unless the appropriate government
orders it following an inquiry conducted by a High Court
Judge in which the Chairperson or member has been
informed of the charges against him and has been given
a reasonable opportunity to be heard on those charges.
Powers of the Regulatory Authority

Power to issue interim orders – Section 36 of the Act

says when the Authority is satisfied that an act in
violation of this Act or the rules and regulations
thereunder has been, is being, or is about to be
committed, the Authority may, by order, restrain any
promoter, allottee, or real estate agent from carrying on
such act until the conclusion of the inquiry or until
further orders, without giving such party notice, if the
Authority deems it necessary.
Power to issue directions – Section 37 of the Act says the
Authority may provide such instructions to the
promoters, allottees, or real estate agents, as the case
may be, as it deems necessary to carry out its powers
under the provisions of this Act or rules or regulations
adopted thereunder and such directions shall be binding
on all parties concerned.
Power to rectify the orders – Section 39 of the Act says
the Authority may alter any order passed by it at any
time within two years of the date of making of the under
this Act, in order to correct any mistake obvious from
the record and shall make such amendment if the
mistake is brought to his notice by the parties. Provided,
no such alteration shall be made in respect of any order
to which an appeal under this Act has been filed.
Furthermore, the Authority shall not change any
substantive portion of its order issued under the
provisions of this Act while correcting any mistakes
obvious from the record.
Responsibilities of the Regulatory Authority
To facilitate registering the real estate project and real
estate agents.
To extend the registration of the real estate or project
and its revocation.
To renew or revoke, as the case may be, the registration
of the real estate agent.
To maintain a website of records for public reviewing.
To appoint more than one adjudicating officer for
addressing the issues relating to real estate matters.
To notify rules and regulations.
To recommend for any growth and promotion of healthy
and transparent functioning of the project.
Establishment of Central Advisory Council (Section 41)
The Central Government may establish a Council to be
called as the Central Advisory Council by notification,
with effect from the date specified in the notification.
The ex-officio Chairperson of the Central Advisory
Council shall be the Minister of Government of India in
charge of the Ministry of the Central Government
dealing with housing. It shall consist of representatives
from the Ministry of Finance, Ministry of Industry and
Commerce, Ministry of Urban Development, Ministry of
Consumer Affairs, Ministry of Corporate Affairs,
Ministry of Law and Justice, Niti Aayog, National
Housing Bank, Housing and Urban Development
Corporation, five representatives from State
Governments to be selected by rotation and five
representatives from Real Estate Regulatory Authorities
to be selected by rotation.

Functions of Central Advisory Council (Section 42)

The Central Advisory Council is purely an advisory
organisation with no administrative duties. It has no
duty or power to recommend how the Act has to be
implemented. As a result, the council’s main objectives
are as follows:

All matters relating to the implementation of this Act.

The policy of the government to be followed for
encouraging the Act.
How can this Act advance consumer interests and how
can the Act help support real estate expansion and other
things that have been entrusted to the Central
Government.
To examine its proposals and create rules to implement
them.
Analysis of the effectiveness of the council
The Central Advisory Council is in charge of predicting
and improving the RERA’s implementation efficiency.
More importantly, the council must endeavour to
improve the real estate sector as it is a significant
contributor to the country’s GDP. While the goal has
been stated, the following areas must be thoroughly
investigated for this council to make a significant
change.

Keeping up the federal spirit – To maximise the efficacy

of this Council, it is necessary to have representation
from all of the states to avoid leaving any area
unrepresented. Currently, the Council is made up of five
states that are chosen on a rotational basis. This denies
the rest of the states the ability to express their views.
The representation should include not just those states
that are now doing well in the real estate business, but
also those that are not doing so well but have the
potential to do so. As a result, state representations
should be increased to at least ten to fifteen states.

Representation of environmental concerns – Consumer

interests are not restricted to money in real estate, thus
environmental issues should be strongly represented on
the CAC. Consumers are also interested in
environmentally sustainable models, which should be
adopted by real estate developers. The CAC may assist in
promoting excellent practices in real estate
developments, which will motivate promoters to go
green and adopt green alternatives while executing such
projects. As a result, both the promoters and the
consumers will profit from it.
Regularise interactions – The RERA meetings must be
held on a more regular basis to avoid the RERA
becoming a “paper tiger.” This will also keep the RERA
from becoming more diluted. The most recent meeting
took place on May 18, 2018. As a result, laws must be
enacted to make the meetings mandatory at least once a
year. Regular interaction is required for representations
to work.

The Real Estate Appellate Tribunal

Real Estate Appellate Tribunal is formed by the
Appropriate Government under Chapter VII of the Real
Estate (Regulation and Development) Act, 2016 to
ensure faster resolution of disputes. Parties aggrieved by
the RERA order can appeal before the Real Estate
Appellate Tribunal and it has to adjudicate such cases
within sixty days. Civil Courts have been prevented from
exercising jurisdiction on such matters. If any of the
parties is not satisfied with the Real Estate Appellate
Tribunal order they can file an appeal against the order
of the Real Estate Appellate Tribunal order to the High
Court within sixty days.

Establishment of Real Estate Appellate Tribunal

(Section 43)
The appropriate government, shall within one year of
commencement of this Act, by notification, establish a
Real Estate Appellate Tribunal. There shall be one or
more benches of the Appellate Tribunal, for various
jurisdictions in the state or union territories, if the
appropriate government deems necessary. Every bench
of the Appellate Tribunal shall consist of at least one
Judicial Member and one Administrative or Technical
Member.

The Act also allows for the establishment of a single

appellate tribunal for two or more states or union
territories. The designated tribunal may hear cases until
such a tribunal is constituted and once the tribunal is
constituted, all the existing cases will be transferred to
the newly established common Tribunal. If the
appropriate government of two or more states or union
territories deems it necessary, may establish a single
Appellate Tribunal.

It may be noted that when a promoter files an appeal

with the Appellate Tribunal, it shall not be entertained,
without the promoter first having deposited with the
Appellate Tribunal at least thirty per cent of the penalty
or such higher percentage as may be determined by the
Appellate Tribunal or the total amount to be paid to the
allottee including interest and compensation imposed on
him or with both, as the case may be before the said
appeal is heard.

Application for settlement of disputes and appeals to

Appellate Tribunal (Section 44)
Section 44 of the Act deals with applications for
settlement of disputes and appeals to the Appellate
Tribunal. It provides that:

The appropriate government or competent authority or

any individual aggrieved by the Authority’s or
adjudicating officer’s direction, order, or judgement,
may appeal to the Appellate Tribunal.
Every appeal under sub-section (1) must be filed within
sixty days from the date on which the appropriate
government, the competent authority, or the aggrieved
person receives a copy of the Authority’s or the
adjudicating officer’s direction, order or decision and it
must be filed in such form and with such fee as may be
prescribed.
Provided that the Appellate Tribunal may hear any
appeal after sixty days term has expired if it is satisfied
that there was a sufficient reason for not filing it earlier.

The Appellate Tribunal may pass such orders, including

temporary orders as it may deem fit after receiving an
appeal under subsection (1) and after providing the
parties with an opportunity to be heard.
The Appellate Tribunal must submit a copy of every
order it makes to the parties as well as the Authority or
adjudicating officer.
It shall deal with the appeal preferred under sub-section
(1) expeditiously and dispose of the appeal within sixty
days of the date of receipt of the appeal.
Provided that if any such appeal is not resolved within
sixty days the Appellate Tribunal shall record its reasons
in writing for not disposing of the appeal within that
period.

Qualifications for appointment of the Chairperson and

members (Section 46)
No person shall be qualified to be appointed as a
Chairperson or member unless he –
Has been or is a Judge of High Court;
In case if he is a judicial member, he has served in the
judicial office within the territory of India for at least
fifteen years or has been a member of Legal Services of
India and has held the post of Additional Secretary of
that service or any equivalent post, or has been an
advocate having at least twenty-years experience with
advocating real estate matters; and
In the case of a Technical or Administrative Member, he
is a person who is well-versed in the areas of law,
planning, commerce, accountancy, real estate,
development, economics, infrastructure, public affairs,
industry management or administration or a state
government equivalent to the post of Additional
Secretary to the Government of India or an equivalent
post in the Central Government;
The appropriate government shall appoint the Chairman
of the Tribunal after consulting with the Chief Justice of
the High Court or his nominee;
The Appropriate Government shall nominate the judicial
members and technical or administrative members of
the Appellate Tribunal on the suggestions and
recommendations of the Selection Committee which
consists of the Chief Justice of the High Court or his
nominee, the secretary of the housing department and
the secretary of law as prescribed.
Term of office of the Chairperson and members (Section
47)
The Chairperson of the Appellate Tribunal or a Member
of the Appellate Tribunal shall serve for a term of not
more than five years from the date of his appointment,
but shall not be eligible for reappointment. Provided
that if a person who is or has been a High Court Judge is
appointed as Chairperson of the Tribunal, he shall not
hold office after he has attained the age of 67 years:
Furthermore, no Judicial member, technical member or
administrative member shall hold office once he has
reached the age of sixty-five. Before choosing anybody as
Chairperson or Member, the competent government
must ensure that the person does not have any criminal
convictions or financial or other interests that may
prejudicially affect his functions.

Powers of the Appellate Tribunal (Section 53)

The Tribunal is not bound by the Code of Civil
Procedure of 1908 or the Indian Evidence Act of 1872,
which impose strict procedures. It shall be guided by the
principle of natural justice and also has the authority to
regulate its own procedures. However, the Chairperson
has administrative powers under the Act as he has been
provided with powers of general superintendence and
direction during the time of their conduct in the affairs
of the tribunal and all the orders passed by the tribunal
are to be executed as a decree of a Civil Court. The
powers of the civil court are entrusted to the Tribunal
which includes the following –

Summoning and enforcing the attendance of any person

and examining him on oath;
Requiring the discovery and production of documents;
Receiving evidence on affidavit;
Issuing commissions for the examination of witnesses or
documents;
Reviewing its decisions;
Dismissing an application for default or deciding it ex-
parte, setting aside any order of dismissal of any
application for default or any order passed by it ex-
parte; and
Any other matters as the Authority may specify by
regulations.
Role of High Courts (Section 58)
All appeals from the Appellate Tribunal are heard by the
High Court of the respective states. This must be done
within sixty days from the date of decision or order on
any of the grounds set out in Section 10 of the Code of
Civil Procedure, 1908. In such instances, there is no
right of appeal if the decision has been reached with the
parties’ consent.

Power to make regulations (Section 85)

The Authority shall, by notification, enact regulations
consistent with this Act to carry out the purposes of this
Act within three months of its establishment, by
notification.
Without prejudicing the generality of the foregoing
power, such regulations may provide for all or any of the
following:
The form and manner of making an application and the
fee payable therewith under Section 4(1);
The form of application and the fees for extension of
registration;
Documents required under Section 11(1)(f) of the Act;
Exhibition of layout plans and sanctioned plans along
with specifications, approved by the competent
authority under Section 11(3)(a) of the Act;
Preparation and maintenance of other such details
under Section 11(6);
Time, places, and procedure for transaction of business
in the meetings of the Authority under Section 29(1);
The form and manner along with the fee payable for
filing a complaint under Section 31(2) of the Act;
Standard fee to be levied on the promoter, the allottees
or the real estate agent under Section 34(e); and
Such other matters which are required to be specified by
regulation.
Penal provisions under RERA
Promoters –

Violation of the provisions of law A promoter shall be

punishable with three years of imprisonment or a fine of
ten per cent of the cost of the building.
Non-registration of a project A promoter shall be
punishable with a fine of ten per cent of the estimated
cost of the building or the project.
False information Shall be punishable with a fine of 5
per cent of the cost of the building or the project.
Agents –

Failure to comply with Authority’s directions The agents

shall be punishable with a fine which may extend up to
five per cent of the cost of the building and daily during
which the offence continues.
Failure to comply with the orders of the tribunal An
agent shall be punishable with imprisonment for a
period of one year with or without a fine, which may
extend to ten per cent of the cost of the building.
Non – registration of the project An agent shall be
punishable with a fine of Rs. 10,000 per day or five per
cent of the total cost of the building.
Analysis of the Real Estate (Regulation and
Development) Act, 2016
Advantages of RERA for the buyers
The customers are usually the ones who suffer the most
if there is a problem, so the RERA was implemented
having them in mind. The RERA Act has the following
advantages:
Risk of delay is avoided: In recent years, builders have
been known for delaying the completion of projects. If
there is any delay, the RERA act stipulates that a penalty
must be paid.
No excess charges: This Act contains all the information
on the pricing per area. The RERA statute defines a
built-up area, super built-up area and carpet area,
making it impossible for builders to charge excessively.
Payment for the super built-up area is forbidden. A
customer will only be charged for the carpet area
specified in the Act.
Transparency: One of the most significant benefits
provided to consumers is transparency. On the RERA
website, the builders are expected to provide details
about everything. This will assist customers in learning
the finer points of the buildings and projects.
Liability: Quality has always been a concern, particularly
when it comes to a place where we must reside. If there
is a quality issue, the consumer should notify the
builder, who should address the issue within 30 days.
Quick redressal: Regulatory organisations and appellate
tribunals will be established in each state under RERA to
resolve builder-buyer issues. A person who has been
aggrieved by any direction can expect a response from
the appellate court within 120 days. If the buyer is not
pleased with the decision of the Appellate Authority, he
may further appeal to them. However, the appeal will
only be heard after payment of
Thirty per cent of the penalty,
or a higher percentage as decided by the Appellate
Tribunal,
or the whole sum due to the allottee, including interest
and compensation, if any.
Advantages of RERA for builders
The following are the few advantages given to the
builders:

Adequate financial inflow: The start of a project is a big

stumbling block for the property business. Financial
changes such as the formation of the GST and as a
result, the liberalisation of FDI have aided RERA in
making business easier. Lenders are more prepared to
provide income to builders now that the RERA Act has
restored trust and openness. The transparency of
monetary transactions has improved since
demonetization. Many international and domestic
investors are being encouraged to invest in Indian
projects. As a result, there are more structured financial
inflows, making property developments easier to
implement.
Increased competition: There are further chances of
reviving the real estate market up to the mark which will
surely interest home buyers to invest and buy property
without any fear of fraud. Due to such progressive rules,
it will most likely generate competition among the
developers as the buyers will be interested in investing
their money into the upcoming projects without much
fear.
Better functioning: In the past, there were no suitable
regulations or norms governing the real estate industry.
There were also a lot of unresolved issues. The RERA act
made it easier for the real estate industry to work
efficiently and consistently.
Imposition of penalty: If a customer does not pay his
dues on time, the legislation contains a clause requiring
the consumer to pay a penalty for the late payment.
Transparency: Both the buyer and the seller benefit from
transparency being the core aspect of the Act.
Transparency also aids in the development of a positive
relationship between the builder and the customers.
Disadvantages of RERA
As much as there are real benefits of enforcing RERA,
there are also some disadvantages. The builders are the
ones who have suffered the most, as a result of the
RERA statute, and have had to shoulder a lot of costs.
This Act has had a significant impact on business. The
following are some of the drawbacks of RERA:

The RERA rules and regulations do not apply to projects

that were initiated before the adoption of RERA.
Compulsory registration may be a drawback because the
government can take a long time to approve a plot.
There is also internal politics in this industry.
Sometimes the government requests additional funds or
requires them to bribe the government to obtain
approval, resulting in financial difficulties.
There are no specific requirements for buildings less
than 5000 square metres. This will allow them to charge
excessive fees resulting in a conflict.
A project may take longer to complete than expected. It
is tedious to begin a new endeavour without completing
the previous one as a builder cannot sell a building until
it is completed and it becomes difficult for them to start
a new project.
It takes around two years for the promoter to acquire
clearance, and thus the sector’s expansion will be
hampered.
There are no provisions for rentals in RERA.
There is a cash flow problem due to the seventy per cent
deposit of payment in the escrow account.
The punishments are severe. In case of contravention of
the provisions of this Act or failure to comply with the
provisions of the Act, the punishment is either five per
cent of the cost of the project.
Impact of the Real Estate (Regulation and Development)
Act, 2016 on the industry
The implementation of RERA has caused significant
disruption in the business. The real estate business has
contributed significantly to the country’s economy but
this measure has harmed the industry and all builders
are currently in financial distress as the Act has a direct
impact on the prices of homes and home loan interest
rates. The sector is beset by financial difficulties and has
been hampered by numerous obstacles. The
implementation of RERA has caused significant
disruption in the business. The real estate business has
contributed significantly to the country’s economy but
this measure has harmed the industry and all builders
are currently in financial distress. The sector is beset by
financial difficulties and has been hampered by
numerous obstacles. RERA has had a massive impact on
the corporate world. The execution of demonetisation
was already a problem but then the simultaneous
enforcement of RERA produced a mass outrage.
Property sectors of many states are becoming more
transparent and credible as a result of existing
regulations. Benefits are anticipated to accrue over time
to all or any buyer. The scope and spirit of the Act can be
upgraded by technologically enabled platforms that can
handle greater data sets that are not yet recognised by
many countries. The predicted advantages of the Act are
likely to grow as a result of the increased focus on its
implementation.
The economic impact of RERA on the industry
In India, three main policies were recently brought in by
the Union Government. They were demonetisation,
Goods and Services Tax and Real Estate (Regulation and
Development) Act which impacted the economy to a
large extent. RERA was enforced after six months of
demonetisation which detrimentally affected the real
estate market and impeded its development. RERA
affected the small-scale developers and contractors,
especially in the metropolitan areas as many of their
planned real estate projects were either abandoned or
delayed until they were registered under RERA Act and
as a result job prospects for the workers were scarce.
There were also changes in liability and increased
responsibility of the builders in terms of the delivery of
the property. Furthermore, it led to a situation where
sellers could not possibly sell the property at lower
prices due to limited incentives and buyers were not
willing to buy property due to their income hit by
demonetisation or the reduced liquidity of the property.
The real estate market was completely sluggish causing
economic impacts and imbalance.

Lacunas in the RERA Act

The RERA Act categorically describes what is a carpet
area but in terms of describing a net functional area, it
did not include the area sold to the allottees for their
individual use, such as the living room, bedroom,
kitchen area and the lavatory, which should have been
included.
Every potential project is to be registered under the Act
under Section 3 of the Act. RERA also bars pre-launches
in cases where authorisation is absent by the agency
concerned. It is challenging when there are several
phases in constriction of a real estate project and
approval is required for each project. As there is no
single-window clearance, the project’s progress will face
hindrances and be delayed. Whereas Section 32 of the
Act says that it is the duty of the Real Estate Authority to
make a recommendation on the development of a single-
window system to the appropriate government of the
competent authority to check if the projects are
completed in due time.
In many states, the implementation of the Act began
only in May 2017 although the Act was effective from
May 2016 and as of 2019 many states and union
territories did not have the Real Estate Authority’s
website launched. As per the status of RERA
implementation in India, the National Capital Territory
of Delhi, Assam, Manipur, Nagaland, Arunachal
Pradesh, Sikkim, Jammu and Kashmir and Ladakh have
not launched the Real Estate Authority’s Website.
As there are insufficient recovery powers with RERA,
there is a big lacuna as there is a failure to comply with
all the orders issued in favour of homebuyers by the
RERA Authorities in the respective states
The Real Estate (Regulation and Development) Act,
2016 does not mention that it is available only for
registered projects.
The Act provides for certain categories of projects that
are not required to be registered; these are within the
scope of this Act. Although the projects mentioned in
Section 3(2) have been pulled out of registration
requirements, it has not been done so in the purview of
other provisions of the Act.
The provisions for registration and obligations to be
carried out at the time of the registration are applicable
only for the registered projects and not all projects.
There is a lack of cash caused by a variety of extrinsic
and intrinsic issues in the sector. Builders are forced to
seek alternative sources of funding, resulting in a spike
in home prices. This fluctuation has an impact on the
demand and supply situation in this industry.
Cash flow issues will arise as there is seventy per cent
investment in the escrow account, causing project
delays. This step is however taken to keep the
developer’s mind from wandering to new projects and to
finish the current project.
If a builder fails to comply with any provisions of the
Act, he is punished with up to three years imprisonment
or a fine of ten per cent of the total cost of the project.
This issue put the buyers at risk and forced them to leave
their homes until the problem was resolved.
RERA does not include any rental agreements, so it is
entirely up to the buyer to save the rental agreement,
which clearly states the agreed and disagreed portions,
to save the property and make correct use of it.
Key challenges of the Real Estate (Regulation and
Development) Act, 2016
RERA, 2016 aim to create symmetry of information
between the promoter and the buyer, transparency of
contractual terms, basic accountability standards, and a
fast-track dispute resolution process. However, the
system’s stumbling blocks are outlined below:

There is still a disparity in the timelines that states use

to enact RERA Acts. Only 15 states have issued final
guidelines, while others are still working on them.
There is also a lot of misunderstanding among brokers
and distributors about how to advertise projects to
customers. Prohibitions on the development of builder
microsites, restrictions on selling, KYC, and other issues
are yet unclear.
There is also some confusion regarding the re-execution
of agreements in cases when the deed has already been
signed. While some states demand that all such
arrangements be re-executed under the RERA, others
exempt existing agreements. This mismatch between
states is causing a lot of misconceptions among property
buyers.
Current issues in India in relation to the Real Estate
(Regulation and Development) Act, 2016
The government intends to put tenanted or abandoned
buildings, as well as their renters, under the Real Estate
(Regulation & Development) Act of 2016, giving the
consumers the same protection as other homebuyers for
the first time. Many cities, particularly Mumbai, have
tenanted or decommissioned buildings that contain
people who have been living there for decades at low and
artificially discounted costs. According to Magic Bricks,
over seventy-four per cent of homebuyers in India are
uninformed of the online process for checking the status
of the project under the Real Estate Regulatory Act and
also unclear about whether the projects are registered on
a website or not. They majorly lack the relevant
information such as carpet area, payment methods and
the builder’s registration number. Many projects were
supposed to register on websites and distribute fliers
with the builders’ specific details.

Analysis of the establishment of the tribunals

When it comes to the establishment of Appellate
Tribunals and related tasks, there have been some
aspects that require attention. The following are some of
them:
Real Estate Appellate Tribunals have not been formed in
all Indian states and union territories. Appellate
Tribunals have been formed in 22 states, with 13
permanent and 9 interim tribunals. The states must
establish permanent authorities and Appellate Tribunals
to better execute the Act and reduce the burden on the
district courts.
There was a petition raised in the Gujarat High Court to
ensure that the tribunals are constituted as per the Act.
Because the Appellate Tribunal lacked technical
members, it was called “Coram non-judice.” Technical
members must be recruited since the real estate
business necessitates specialised knowledge that judicial
members may lack. Real estate is a vital national asset.
The goal of the Act will be defeated if the Tribunal
becomes bureaucratized. Other difficulties were noted as
well, such as the Appellate Tribunal’s failure to give
information on the number of appeals filed, pending
appeals, and so on. To avoid further dilution of the
RERA, it is necessary to guarantee that the institutions
involved are given sufficient autonomy to function
efficiently and that additional bureaucratisation is
avoided. Important factors such as vacancies not being
filled or appointments not being made impede
institutions and contribute may defeat the objectives of
the Act.
Judicial insights
Geetanjali Aman Constructions v. Hrishikesh Ramesh
Paranjpe
Issue – In this case, the issue was about project
registration and the dispute was with regard to Section 3
of RERA. The most essential rule in this regard was
Section 3(2), which stated specifically that projects are
not necessary to be registered if their area does not
exceed 500 square metres or if the building does not
have more than eight storeys.

Arguments – Even after arguing that it is an “or”

condition and not a “and” condition, the defendant
failed to get the desired result. The argument put
forward stated that the first condition that it must be
within 500 sq meters. is satisfied, while the allottees
have filed that since there are approximately 22 flats and
9 shops, it violates the second condition The question
before the court was to interpret Section 3(2) and it held
that Section 3(2) will be interpreted in its truest sense
now and that the developer needs to satisfy both the
conditions to get approval.

Decision – Held that the developer has to register the

project within one month and pay thirty lakhs.

Mr. Jatin Mavani v. M/s. Rare Township Pvt. Ltd, 2018

Issue – The issue, in this case, is the filing of several
RERA proceedings on the same subject matter. In this
case, the complainant claimed that despite booking an
apartment and paying the appropriate consideration, he
was not provided with the flat on time and that other
customers similarly sought redress from Maharashtra
RERA, requesting the cancellation fee be waived and the
sum already paid to be refunded.

Arguments – The respondent builder argued that the

first complainant never had the agreement registered
and hence it could not be carried out. Even after the
respondent asked him to enter into a new agreement, he
refused and is now coming up with other buyers which
would amount to a multiplicity of proceedings under the
same authority, as he was a party to an earlier
proceeding.

Decision – The Maharashtra RERA took note of this and

decided that the complainant had exhausted his remedy
when he first sought the forum and that he now has no
locus standi in approaching the court because, if he is
regarded as an allottee, numerous proceedings before
the same court would not be permitted.

Sushil Ansal v. Ashok Tripathi, Saurab Tripathi, 2020

Facts – In this case, a decree was challenged in the
NCLAT, which ordered the company to file for
insolvency in order to pay a sum of rupees 73 lakh
awarded by Uttar Pradesh RERA. The question was
whether home buyers may be considered financial
creditors.

Decision – The forum determined that homebuyers can

enforce their decree under civil law, but they cannot seek
remedy from the IBC. According to the 2019
amendment, either 100 buyers or ten per cent of the
allottee must file bankruptcy, but the fact that there are
only 100 buyers can force the company to file
bankruptcy by only two or three individuals. It is
clarified that a home buyer is not to be seen on the same
lines as a financial creditor when it comes to enforcing a
decree for the repayment due to default on the part of
the promoter itself.

Baldev Singh v. Ultratech Township Developers Pvt

Limited, 2020
Issue – The question, in this case, was whether an
allottee can demand a refund while withdrawing from a
project which was nearing completion. The Authority in
his opinion held that it not only protects the interest of
the buyers but promotes orderly growth of the real
estate industry through efficient project execution in the
interest of the larger public.

Decision – The Haryana RERA Panchkula’s view can be

summed up as follows –

“In case the relief of refund is granted to the

complainant, interests of the rest of the non-
complainant allottees could also get seriously
jeopardised. Moreover, the flat of the respondent is
complete and ready for possession and the complainant
can take possession of the flat after clearing his pending
dues.”

Conclusion
The Act is a great step forward in terms of boosting
transparency in the real estate market, increasing
promoter and developer accountability, and providing
effective grievance resolution channels. As there are
stringent rules and regulations in the highly corrupt
sector, there will be less litigation. The establishment of
laws like RERA is a big step forward in terms of raising
awareness among customers, promoters, and builders.
In the future, similar to RERA, the modernisation of
land records, land acquisition, and GST could be
prioritised for the real estate sector’s growth. The RERA
is dedicated to the successful and effective
implementation of the country’s real estate law, and it
has adopted relevant and consistent steps to promote
the sector’s development. Various policy measures
adopted under the RERA would undoubtedly produce
significant improvements in the economic and social
transformation to stimulate the long-term development
of RERA, as well as a customer-friendly environment.

References
https://www.indiacode.nic.in/handle/123456789/2158?
sam_handle=123456789/1362
https://bnblegal.com/article/critical-analysis-of-rera-
act-2016/
http://lawzilla.in/uncategorized/drawbacks-and-
shortcomings-of-real-estate-regulation-and-
development-act-2016/
http://www.penacclaims.com/wp-
content/uploads/2020/07/Nithi.pdf
https://ijpiel.com/index.php/2022/01/03/4488/
https://corporate.cyrilamarchandblogs.com/2018/10/p
owers-of-state-real-estate-authorities-rera/
Certainly. I'll provide a more detailed explanation of the
provisions related to real estate agents in the Real Estate
(Regulation and Development) Act, 2016 (RERA):

1. Definition of Real Estate Agent:

The Act provides a comprehensive definition of a real

estate agent to ensure clarity and prevent any loopholes.
This definition includes anyone who:
- Negotiates or acts on behalf of one person in a property
transaction
- Facilitates the sale or purchase of a plot, apartment, or
building
- Receives remuneration, fees, or any other charges for
their services

This broad definition ensures that all intermediaries in

real estate transactions are covered under the Act.

2. Registration of Real Estate Agents:

a) Mandatory Registration:
- This provision aims to formalize the real estate agent
profession.
- It ensures that only qualified and registered individuals
can operate as real estate agents.
- This helps in maintaining a database of agents and
makes them accountable.

b) Application for Registration:

- The application process is standardized across the
country.
- The prescribed form and fee ensure uniformity and
prevent arbitrary practices.
- This process allows the Authority to vet the credentials
of the agents.

c) Grant of Registration:
- The 30-day timeline ensures prompt processing of
applications.
- The deemed approval clause prevents unnecessary
delays due to bureaucratic inefficiencies.

d) Validity of Registration:
- The 5-year validity provides stability to the agents'
business.
- The renewal process ensures periodic review of the
agents' conduct and credentials.
3. Functions of Real Estate Agents:

These functions are designed to:

- Ensure that agents only deal with RERA-registered
projects, thus protecting buyers from unauthorized
developments.
- Maintain transparency through proper record-keeping.
- Prevent unfair trade practices, protecting the interests
of buyers.
- Facilitate smooth transactions by ensuring all
necessary documents are provided to buyers.

4. Obligations of Real Estate Agents:

These obligations aim to:

- Prevent misrepresentation and false advertising.
- Ensure full disclosure to potential buyers.
- Protect buyers' interests throughout the transaction
process.

5. Revocation of Registration:
This provision:
- Acts as a deterrent against malpractices.
- Provides the Authority with power to take action
against errant agents.
- Ensures ongoing compliance with the Act.

6. Penalties:

The penalty structure:

- Is designed to be a strong deterrent against violations.
- Is proportional to the scale of the transaction involved.
- Accumulates daily, encouraging quick rectification of
violations.

7. Renewal of Registration:

This process:
- Ensures periodic review of the agent's conduct and
credentials.
- Allows the Authority to deny renewal in case of past
misconduct.

8. Display of Registration Number:

This requirement:
- Helps buyers verify the authenticity of the agent.
- Facilitates tracking of transactions facilitated by each
agent.

9. Maintenance of Website:

This provision:
- Enhances transparency in the real estate sector.
- Allows easy verification of agent credentials by the
public.

10. Right to Information:

This ensures:
- Transparency in the registration process.
- Public access to information about registered agents.

11. Liability for False Information:

This provision:
- Deters agents from providing false information during
registration.
- Ensures the integrity of the information available with
the Authority.

12. Appeals:

The appeals process:

- Provides a mechanism for redressal of grievances
against the Authority's decisions.
- Ensures natural justice by allowing agents to present
their case before a higher forum.

Impact and Significance:

1. Professionalization of the Sector: RERA has

transformed real estate agency from an informal
occupation to a regulated profession.

2. Consumer Protection: The Act's provisions

significantly enhance buyer protection by ensuring they
deal with registered, accountable agents.
3. Transparency: The registration process and public
availability of agent details increase transparency in the
sector.

4. Accountability: The penalty provisions and possibility

of registration revocation create a strong accountability
mechanism.

5. Standardization: The Act brings uniformity to the

practices of real estate agents across the country.

6. Market Confidence: By regulating agents, the Act aims

to boost buyer confidence in the real estate market.

7. Data Collection: The registration process allows

authorities to collect valuable data on real estate
transactions.

8. Elimination of Unscrupulous Elements: The stringent

provisions are likely to deter or eliminate unethical
operators from the market.

In conclusion, the provisions related to real estate agents

in RERA 2016 represent a comprehensive attempt to
regulate this crucial intermediary in the real estate
sector. By mandating registration, defining clear
functions and obligations, and establishing a penalty
mechanism, the Act aims to professionalize the role of
real estate agents and protect homebuyers' interests.
This is part of the larger goal of RERA to bring
transparency, accountability, and efficiency to India's
real estate sector.