Real Estate (Regulation & Development) Act (RERA) – The State Affair

Real Estate (Regulation &
Development) Act (RERA) – The
State Affair

Foreword
A. Didar Singh
Secretary General | FICCI
After undergoing unprecedented change in the last
two decades, the real estate sector continues to be at
the forefront of the Indian Government’s agenda on
account of its potential to propel economic growth
significantly. I am happy to share with you the findings
of the FICCI-Grant Thornton-Khaitan & Co report
“Real Estate (Regulation & Development) Act (RERA) -
The State Affair”. This report has brought to light some
interesting facts about the rules at the state level. A first
of its kind, the report presents a holistic assessment of
pan-India (Uttar Pradesh, Madhya Pradesh, Maharashtra,
Telangana, Delhi, Tamil Nadu, Karnataka, West Bengal,
and union territories) RERA rules and puts forth
recommendations for states that are still in the process of
formulating the rules. The report also assesses the impact
of the regulation on various stakeholders covered under
the Act.
Notified last year, RERA is now seen as one of the most
significant reforms in the real estate sector. According to
RERA, all the state governments were to put in place the
Act’s rules and regulations by May 1, 2017. While some
states and union territories have either notified or drafted
the rules, others are yet to frame their own rules.
The release of the report in the seminar on Real Estate
Regulation Rules, GST & Affordable Housing (Credit
Linked Subsidy Scheme) on May 4, 2017 at Federation
House, New Delhi, would set the tone for deliberations.
I am sure that findings of the report would be invaluable
not only to realtors, but to consumers, government,
research, academia and the industry as well. The ideas and
conclusions that arise from this report would go a long
way in addressing the regulatory challenges and show the
path for taking the real estate sector to greater heights.
2 | Real Estate Regulation Act (RERA) – The State Affair

Neeraj Sharma
Director, Grant Thornton Advisory Private Limited
E: Neeraj.Sharma@in.gt.com
M: +91 98998 66635
Sudip Mullick
Partner, Khaitan & Co
E: sudip.mullick@khaitanco.com
M: +91 98198 96968
We are delighted to share with you the FICCI-Grant
Thornton-Khaitan & Co report “Real Estate (Regulation
& Development) Act (RERA) - The State Affair”which
gives an insight into some of the key provisions of the
Act across various states in a comparative form.
It’s a defining moment for the real estate sector which is
set for a tectonic shift with the implementation of this
Act and its various provisions. RERA has the potential
of transforming the real estate sector by bringing in
much-needed transparency and consistency, apart
from boosting the customer confidence and attracting
investments for the sector. Going forward, companies
in the real estate sector would need to ramp up their
systems/processes and focus on areas of project planning
and design. Besides, companies should also work towards
efficient working capital management to ensure full
compliance with the law.
While states like Gujarat, Maharashtra, Uttar Pradesh,
Madhya Pradesh, and Odisha have finalised their rules, in
some states, current rules are still in the draft stages. It is
in the interest of the sector that states are able to comply
with the timelines.
I hope this report not only facilitates a healthy discussion
among the panellists present here today, but also helps
various stakeholders understand the impact of some of
the key provisions in their respective states.
Real Estate Regulation Act (RERA) – The State Affair | 3

Journey so far
The real estate sector plays a catalytic role in fulfilling the need and demand for
housing and infrastructure in the country. While this sector has grown significantly
in recent years, it has been largely unregulated. There is, thus, absence of
professionalism, standardisation and lack of adequate consumer protection. Though
the Consumer Protection Act, 1986 is available as a forum to the buyers in the
real estate market, the recourse is only curative and is inadequate to address all the
concerns of buyers and promoters in that sector. The lack of standardisation has
been a constraint to the healthy and orderly growth of the industry. Therefore, the
need for regulating the sector has been emphasised on various forums.
The National Conference of Ministers
of Housing, Urban Development and
Municipal Affairs of States and UTs
proposed a law for real estate sector
During subsequent consultations by the Central Government, it
was decided to enact a central law for real estate sector. This was
endorsed by Competition Commission of India, Tariff Commission
and Ministry of Consumer Affairs. Ministry of Law & Justice
suggested a central legislation for real estate under specified
entries of Concurrent List of the Constitution for regulation of
contracts and transfer of property
Union Cabinet
approved the Real
Estate Bill, 2013
Bill was referred
to the Department
Related Standing
Committee
Report of the Standing
Committee tabled in
the Rajya Sabha and
the Lok Sabha
The Real Estate
Bill, 2013
introduced in the
Rajya Sabha
January 2009
June 2013
August 2013
September
2013
February
2014
July 2011

The Rajya Sabha
passed the bill
The Lok Sabha
passed the bill
Attorney General upheld
the validity of central
legislation for Real
Estate Sector and the
competence of Parliament
a. Following Centre’s move of notifying the Act,
some progressive states have taken up the
task of formulating their own rules under the
Act since October 2016
b. In total, 7 states along with 5 union territories
have either notified their own RERA rules
or have published draft rules for public
comments
c. On 17 January 2017, Minister of Housing
and Urban Poverty Alleviation Venkaiah Naidu
held a meeting with housing secretaries/
chief secretaries of all states and Union
territories in New Delhi to address the issue
of safeguarding the legislation
Union Cabinet approved
Official Amendments
based on Standing
Committee Report
Real Estate Bill, 2013
and Official Amendments
referred to the Select
Committee of the Rajya
Sabha
Select Committee of
the Rajya Sabha tabled
its report along with the
Real Estate Bill, 2015
Union Cabinet approved
the Real Estate Bill,
2015 as reported by
the Select Committee
of the Rajya Sabha for
further consideration of
Parliament
Bill listed in the Rajya
Sabha for consideration
but could not be taken up
President of India accorded his assent
to the Bill
The Real Estate (Regulation and
Development) Act, 2016 was published
in the Gazette for public information
The Central Government notified the
entire Act which came into force on
1 May 2017
59 Sections of the Real Estate
(Regulation and Development) Act,
2016 notified by the Ministry of
Housing & Urban Poverty Alleviation
on 27 April 2016 bringing the Act into
force with effect from 1 May 2016
February
2015
October 2016-
January 2017
April 2017
April 2015
May 2015
July 2015
December
2015
December
2015
March
2016
March
2016
March
2016
March
2016
April
2016

Mapping India’s
regulation
A number of states have either notified or published into their own rules under the state Act with some diversions and
improvement in provisions from the main Act. The subsequent section maps the entire national scenario till the end of
April 2017.
a. Rules framed by union territories, Delhi, Gujarat, Maharashtra, Madhya Pradesh, Odisha and Andhra Pradesh are in
force.
b. Rules framed by Uttar Pradesh have been finalised but are yet to be notified.
c. States such as West Bengal, Karnataka and Tamil Nadu have framed draft rules for public comments.
d. Union Territories and states such as Maharashtra, Delhi, Karnataka, Tamil Nadu, Odisha and Andhra Pradesh have
prescribed the format of agreement for sale which a promoter is required to adopt while selling the apartment.
e. Rules framed by Gujarat are primarily related to the appointment, functioning and administration of the Real Estate
Regulatory Authority and Real Estate Appellate Tribunal.

PARTICULARS Union territories (UT) (IN FORCE)
A. Total price of the apartment to
include:
• Break-up of cost of apartment, garage/closed parking, proportionate cost of common areas,
preferential location charges, taxes, etc.
• All taxes (VAT, Service Tax and Cess or any other similar taxes which may be levied, in con-
nection with the construction of the Project) till handing over possession. In case there is any
change/modification in the taxes, the subsequent amount payable by the allottee to the promot-
er shall be increased/reduced based on such change/modification
• (However, if there is any increase in taxes after expiry of scheduled date of completion of the
project as per registration with the Authority, which shall include the extension of registration,
then the promoter shall not charge the same to the allottee – This is provided only in the AFS of
UTs and not in the AFS of other states)
• Recovery of price of land, construction of common area, internal and external development
charges, cost of providing electric wiring, electrical connectivity to the apartment, lift, water line
and plumbing, finishing with paint, marbles, tiles, doors, windows, fire detection and firefighting
equipment in the common areas, maintenance charges
• Cost of maintenance of essential services till maintenance is taken over by association of
allottee
B. Total price – escalation free • Total price is escalation free - excepting increase in development charges or any other increase
in charges by the competent authority
• The promoter should enclose copy of the notification /order/rule /regulation towards such
increase along with the demand letter for subsequent payment
• Provided that if there is any new imposition or increase of any development charges after the
expiry of the scheduled date of completion of the project as per registration with the Authority,
which shall include the extension of registration, then the promoter shall not charge the same to
the allottee. (This is provided only in the AFS of UTs and not in the AFS of other states)
C. Recalculation of total price on
receipt of OC
Shall be recalculated and adjusted on confirmation of final carpet area on receipt of OC
D. Rebate for early payment The Promoter may allow, in its sole discretion, a rebate for early payments of instalments
payable by the allottee by discounting such early payments for the period by which the respective
instalment has been preponed.
Such rebate shall not be subject to any revision/withdrawal, once granted to an allottee by the
promoter.
E. Set off/adjustment of instalments Promoter can adjust/appropriate all payments made by allottees under any head(s) of dues
against lawful outstanding of the allottee against the apartment/plot and the allottee is required to
undertake to not to object/demand/direct the promoter to adjust his payments in any manner
PRICING OF THE APARTMENT - AS MENTIONED IN THE AGREEMENT OF SALE
These provisions could be
considered by other states
while drafting their rules

DELHI (IN FORCE) KARNATAKA (DRAFT) TAMIL NADU (DRAFT) MAHARASHTRA (IN FORCE)
Same as UT Same as UT Same as UT Break-up of the cost of apartment, garage/parking space,
proportionate cost of common areas and facilities.
However, it excludes all taxes (VAT, Service Tax and Cess or
any other similar taxes which may be levied in connection
with the construction of the Project) till handing over posses-
sion. (This is a deviation from other rules)
Same as UT Same as UT Same as UT Same as UT

PARTICULARS UTs (IN FORCE)
A. Due to delay in handing over
possession by the promoter
- In accordance with terms of the
agreement or due to revocation or
suspension due to force majeure event
Promoter to refund the entire amount plus interest and compensation within 45 days from the date
of receipt of termination notice from the allottee.
- Due to force majeure event The promoter shall refund to the allottee the entire amount received by the promoter from the
allottee within 45 days from the date it becomes impossible for the promoter to implement the
project due to such force majeure event. (It appears that promoter is not required to pay interest
or compensation)
B. Refund in case of breach committed
by allottee in payment of instalments
Promoter is required to issue consecutive notices to the allottee for demanding payment of
outstanding instalment, falling which, the promoter shall be entitled to cancel the allotment and
forfeit the booking amount plus applicable interest and refund the balance amount to the allottee.
C. Voluntary withdrawal
- by allottee
Allottee can also voluntarily withdraw without any default by promoter and in such an event,
promoter can only forfeit the booking amount and refund the balance within 45 days.
REFUND OF CONSIDERATION - AS MENTIONED IN THE AGREEMENT OF SALE

DELHI (IN FORCE) KARNATAKA (DRAFT) TAMIL NADU (DRAFT) MAHARASHTRA (IN FORCE)
Same as UT Same as UT Same as UT The promoter shall be liable on demand to refund to the
allottee the amounts already received by him in respect of
the apartment with interest.
Same as UT Same as UT Same as UT Silent
Same as UT Same as UT Same as UT On allottee committing 3 defaults of payment of instalments,
the promoter can exercise the option to terminate
the agreement by issuing 15 days notice in writing by
Registered Post AD at the address provided by the allottee
and send a mail on the e-mail address provided by the
allottee for demanding payment of outstanding instalment,
failing which, the promoter shall be entitled to terminate the
agreement and refund within 30 days of termination, the
instalments of sale price after adjusting/recovering agreed
liquidated damages or any other amount which may be
payable to promoter. (Other states restrict it to forfeiture of
booking amount only)
Same as UT Same as UT Same as UT Silent

ONGOING PROJECT
Disclosure requirement
DELHI UTs (IN FORCE)
Disclose the original sanctioned plan, layout plan and
specifications and the subsequent modifications carried
out, if any, including the existing sanctioned plan, layout
plan and specifications.
Disclose the status of project and extent of completion.
Disclose the size of the apartment based on carpet area
even if earlier sold on any other basis such as super area,
super built up area or built up area.
In case of plotted development, the promoter shall
disclose the area of plot being sold to allottees.
Disclose the (i) total amount of money collected from
the allottees, (ii) total amount of money used for
development of the project, and (iii) total amount of
balance money lying with the promoter.
(Unlike Maharashtra, it does not provide for disclosure
of amount of balance money receivable from existing
allottees and the total amount of money receivable
from sale of unsold units)
MAHARASHTRA (IN FORCE)
The promoter is required to submit the following
certificates:
(a) Architect’s certificate - Certifying the percentage of
completion of construction.
(b) Engineer’s certificate - Certifying the estimated cost
to complete remaining construction of each of the
building/wing of the project.
(c) CA certificate – Certifying the balance cost to
complete the project.
(d) CA certificate - Certify the (i) balance amount of
receivables from the apartments/flats/premises sold
or allotted with respect to those in which agreements
have been executed, and (ii) estimated amount of
receivables from unsold units calculated at the
prevailing Annual Statement of Rates (ASR).
(e) The number of apartments sold or allotted to allottees
and the basis on which they were sold/allotted. (Basis
over here refers to carpet area, super area, super built
up area).
(f) In case of plotted development, the area of plots
sold to allottees and details like the extent of share of
common areas and amenities.

KARNATAKA (DRAFT)
UTTAR PRADESH (NOTIFIED BUT NOT IN FORCE)
even if earlier sold on any other basis such a super area,
TAMIL NADU (DRAFT)
WEST BENGAL (DRAFT)
MADHYA PRADESH (IN FORCE)

ONGOING PROJECTS
Disclosure on timeline for completion of balance construction
DELHI (IN FORCE)
Disclose the original time period disclosed to the
allottee for completion of the project at the time of sale
including the delay and the time period within which
he undertakes to complete the pending project, which
shall be commensurate with the extent of development
already completed, and this information shall be certified
by an engineer, an architect and a chartered accountant in
practice.
Disclose all details of ongoing project including (i) the
extent of the construction work completed in respect
of buildings as per the last approved sanctioned plan
of the project, and (ii) the extent of development of
common areas, amenities etc. along with expected
period of completion of the ongoing project which
shall commensurate to the extent of development work
completed.
For Delhi, UT and Maharashtra, it is unclear as to
whether the promoter would at all be liable to pay
compensation for delay of the contract period and if yes,
at what rate, i.e. at the contractual rate or the rates fixed
as per the rules or whether the promoter will be absolved
from the compensation for such delay as long as she/he
completes the project within the new timeline so declared
KARNATAKA (DRAFT)
Silent
Silent
TAMIL NADU (DRAFT)
Silent
WEST BENGAL (DRAFT)
Silent
Silent

Exemption for seeking 2/3rd consent of allottees in case of modification
of plans
Silent
Prior written consent of atleast 2/3rd of the allottees
would not be required if – (i) implementation of the
proposed plan has already been disclosed to the allottee
under the agreement prior to registration, or (ii)
modification is required to be made in compliance of
any order or direction issued by competent authority or
statutory authority.
Under the agreement for sale, the promoter is not
required to obtain the consent of allottee in case of any
alteration or addition to the apartment required by
Government authorities or due to change in law.
KARNATAKA (DRAFT)
Silent
Silent
TAMIL NADU (DRAFT)
If the project has been conceived to be developed in
phases and the plans for the initial phase are approved
by the planning authority prior to the notification
of the rules, then, for such projects, the requirement
of obtaining 2/3rd consent from existing allottee is
exempted for addition/revision/modification of plans
for subsequent phases of development, provided the
scheme of developing the project in phased manner has
been agreed upon by the allottee and promoter in the
agreements executed between them.
WEST BENGAL (DRAFT)
Silent
Silent

ONGOING PROJECTS
Deposit of 70 per cent realisation - past or future receivables
DELHI UT (IN FORCE)
Promoter is required to deposit in the separate bank
account, 70 per cent of the amounts already realised
from the allottees, which have not been utilised for
construction of the project or the land cost.
Maharashtra Rules clarify that promoter is required to
only deposit 70 per cent of such amounts as are to be
realised from the allottees after the Act comes into force.
However, if the receivables of the ongoing project is less
than the estimated cost of balance construction, then the
promoter shall deposit 100 per cent of the amounts to be
realised in the separate account.
KARNATAKA (DRAFT)
Silent
Silent
TAMIL NADU (DRAFT)
Silent
WEST BENGAL (DRAFT)
Silent
Silent
States which are silent on this aspect need to classify on
similar lines with Delhi, UTs and Maharashtra.

Disclosure of carpet area
DELHI (IN FORCE)
Disclose the size of the apartment based on the carpet
area even if sold on any other basis such as super area,
super built up area, built up area, etc. which shall not
affect the validity of the agreement entered into between
the promoter and the allottee to that extent.
Disclose the number of apartment sold or allotted on
carpet area basis or on other basis such as built up area,
super built up area, etc. Such disclosure shall not affect
the validity of the agreement entered into between the
promoter and the allottee.
This is a departure from other rules which require the
promoter to disclose the carpet area even if sold earlier on
built up or super built up area.
KARNATAKA (DRAFT)
super built-up area, built up area, etc which shall not
affect the validity of the agreement entered into between
the promoter and the allottee to that extent.
even if earlier sold on any other basis such as super
built up area, built up area, etc which shall not affect
the validity of the agreement entered into between the
promoter and the allottee to that extent.
UTs (IN FORCE)
The promoter shall disclose the size of the apartment
based on carpet area even if earlier sold on any other
basis such as super area, super built up area, built up area
etc. which shall not affect the validity of the agreement
entered into between the promoter and the allottee to
that extent.
TAMIL NADU (DRAFT)
based on carpet area even if earlier sold on any other
basis such as super area, super built up area, built up area
that extent.
WEST BENGAL (DRAFT)
based on the carpet area even if sold on any other basis
such as super area, super built up area, built up area,
that extent.
based on the carpet area even if sold on any other basis
such as super area, super built up area, built up area,
that extent.

ONGOING PROJECTS
Exception to ongoing project
Silent
Silent
ANDHRA PRADESH – EXEMPTION OF ONGOING
PROJECT
Projects which fulfil any of the following criteria, will not
be treated as an ongoing project under the Act:
• Where roads, open spaces, amenities and services have
been handed over to the local authority in layout
projects;
• Where all slabs are laid in housing projects;
• Where all the development work have been completed
and sale/lease deeds of 50 per cent of the apartments/
houses/plots have been executed;
• Where development works have been completed
and application has been filed with the competent
authority for issue of completion certificate or
occupancy certificate.
KARNATAKA (DRAFT)
Silent
be treated as an ongoing project under the Act:
• Where the services have been handed over to the Local
Authority for maintenance;
• Where common areas and facilities have been handed
over to the Association or the Residents’ Welfare
Association for maintenance;
• Where all the development work have been completed
and sale/lease deeds of 60 per cent of the apartments/
houses/plots have been executed;
• Where all the development works have been completed
and application has been filed with the competent
authority for issue of completion certificate.
TAMIL NADU (DRAFT)
be treated as an ongoing project:
a. Where services have been handed over to the Local
Authority for maintenance; or
b. Where common areas and facilities have been handed
over to the Association or the Residents’ Welfare
Association for maintenance; or
c. Where all development works are complete and
application or intimation letter has been submitted
with the competent authority for obtaining completion
certificate, if applicable.
WEST BENGAL (DRAFT)
Silent
Silent

COST ELEMENTS
Definition of land and construction cost
DELHI UT (IN FORCE)
Silent
Land cost:
a. Acquisition cost, lease charges, overhead cost, marketing
cost, legal cost and supervision cost.
b. Premium paid to obtain development rights, FSI,
additional FSI, fungible FSI, and any other incentive
under DCR.
c. Acquisition of TDR.
d. Consideration payable to outgoing developer.
e. Amounts payable to state government or competent
authority or any other statutory authority of the state or
central government, towards stamp duty, transfer charges,
registration fees etc.
f. Premium payable as per annual statement of rates (ASR)
for redevelopment of land owned by public authorities.
g. In case the promoter is not required to incur any cost
towards acquisition of the land due to inheritance, gift
or otherwise, the cost of land shall be reckoned on basis
of the value of the land as ascertained from the ASR
prepared under the provisions of the Maharashtra Stamp
Act, 1958 relevant on the date of registration of the
project.
Construction cost:
a. On-site and off-site expenditure for development of
project.
b. Payment of taxes, fees, charges, premiums, interest etc.
c. Principal sum and interest payable to financial
institutions, scheduled banks, non-banking financial
institution (NBFC) or money lenders.
Construction cost shall not include the sum which
the promoter has raised and incurred by way of loan
obtained from such banks, non-banking finance
companies or money-lenders, for the purpose of
purchase of land for the project or for obtaining the
development rights over such land.
d. Rehabilitation scheme – expenditure towards clearance
of land or encumbrances for temporary transit
accommodation, construction of rehab building,
overhead cost, ASR linked premium, fees, charges and
security deposits to authorities.
KARNATAKA (DRAFT)
Construction cost: Cost incurred by the promoter
towards on-site expenditure for the physical development
of the project.
Construction cost: Cost incurred by the promoter,
towards the on-site expenditure for the physical
development of the project.
TAMIL NADU (DRAFT)
Silent
WEST BENGAL (DRAFT)
Silent
Silent

Registration fee
Commercial project: Rs 20 per square metre if land area
is less than 1,000 square metre. Rs 25 for every square
metre if land area exceeds 1,000 square metres, but not
more than Rs 10,00,000;
Group housing project: Rs 5 per square metre if land
area is less than 1,000 square metre. Rs 10 for every
square metre if land area exceeds 1,000 square metres, but
not more than Rs 5,00,000;
Mixed development Project (residential and
commercial): Rs 10 per square metre if land area is less
than 1,000 square metre. Rs 15 for every square metre if
land area exceeds 1,000 square metres, but not more than
Rs 7,00,000;
Plotted development project: Rs 5 per square metre but
shall not be more than Rs 2,00,000.
Rs 10 per square metre of the land area subject to
minimum of Rs 50,000 and maximum of Rs 10,00,000.
KARNATAKA (DRAFT)
Not provided
is less than 1,000 square metres. Rs 1,000 for every 100
square metres or part thereof if land area exceeds 1,000
square metres;
Residential project: Rs 10 per square metre if land area is
less than 1,000 square metre. Rs 500 for every 100 square
metres or part thereof if land area exceeds 1,000 square
metres.
TAMIL NADU (DRAFT)
Silent
WEST BENGAL (DRAFT)
is less than 1,000 square metre. Rs 100 for every square
metre if land area exceeds 1,000 square metres;
Residential project: Rs 10 per square meter if land area
is less than 1,000 square metres. Rs 20 for every square
metre or part thereof if land area exceeds 1,000 square
metres.
Residential project: Rs 10 per square meter if land area
metre or part thereof if land area exceeds 1,000 square
metres.
metre if land area exceeds 1,000 square metres.
COST ELEMENTS

Silent
Silent
KARNATAKA (DRAFT)
A plan of the project depicting the division or proposed
division of land into plots, roads, open spaces, amenities,
etc. and other details as may be necessary.
Plan of the project depicting the proposed division of land
into plots, roads, open spaces, amenities, etc. and other
details as may be necessary.
TAMIL NADU (DRAFT)
division of land into plots, roads, open spaces, amenities,
etc., and other details as may be necessary.
WEST BENGAL (DRAFT)
division of land into plots, roads, open spaces, amenities
division of land into plots, roads, open spaces, amenities
OTHER KEY PROVISIONS

Parking space
Litigation to be disclosed
Silent
Covered parking space means an enclosed or covered
area as approved by the Competent Authority as per the
applicable Development Control Regulations for parking
of vehicles of the allottees which may be in basements
and/or stilt and/or podium and/or space provided by
mechanised parking arrangements, but shall not include a
garage and/or open parking.
KARNATAKA (DRAFT)
Silent
Silent
TAMIL NADU (DRAFT)
Parking means the parking space(s) as shown in the plans
approved by the planning authority.
WEST BENGAL (DRAFT)
Silent
Silent
DELHI (IN FORCE)
Details of litigations in relation to the project including
details of litigations which have been disposed of by
the concerned court in the past 5 years in relation to the
real estate projects developed or being developed by the
promoter.
Details of proceedings in relation to the project which are
sub-judice.
KARNATAKA (DRAFT)
Details of past or ongoing litigations in relation to the
real estate project.
UTs (IN FORCE)
Details of litigation in the past 5 years in relation to the
real estate projects developed or being developed by the
promoter.
TAMIL NADU (DRAFT)
WEST BENGAL (DRAFT)
Details of ongoing litigations in relation to the real estate
project.

Extension of registration
As per the Act – (i) force majeure event and (ii) under
reasonable circumstances for such period not exceeding 1
year.
year.
Under the Rules, extension will also be granted where
actual work could not be carried by the promoter as per
the sanctioned plan due to specific orders relating to
the project from any Court of law, tribunal, competent
authority, statutory authority or a high power committee
or due to such mitigating circumstances as may be
decided by the Authority.
KARNATAKA (DRAFT)
year.
year.
TAMIL NADU (DRAFT)
year.
WEST BENGAL (DRAFT)
year.
year.

Revocation – protecting interests of mortgagee and investors
Silent
While facilitating the remaining development work, the
Authority shall take such measures as may be required to
protect the interests of mortgagees and investors which
have been disclosed by the promoter to the Authority
and also displayed on the website of the Authority.
The Authority shall also give adequate opportunity
to be heard to debt and equity investors in the project
including, but not restricted to scheduled banks;
housing finance companies, insurance companies,
NBFC operating as asset finance companies, investment
companies, loan companies, investment finance
companies, infrastructure debt funds, micro finance
institutions, foreign direct investors, private equity funds,
Real Estate Investment Trust (REIT), etc. Rules of other
states do not deal with this matter in such detail.
KARNATAKA (DRAFT)
Silent
Silent
TAMIL NADU (DRAFT)
Silent
WEST BENGAL (DRAFT)
Silent
Silent
(Other states should also consider similar provisions as
mentioned in Maharashtra rules in order to protect the
interests of mortgagees and investors which have been
disclosed to the Authority)

Car Parking (Open and closed/covered*
)
The rule requires the promoter to disclose the number of
open and covered car parks available in the project.
The Agreement for Sale in Recital L suggest that covered
car park can be sold to the allottee and price of such car
park can be mentioned separately in the agreement.
The rule requires the promoter to disclose the number
of open, covered, enclosed or unenclosed car park in the
project.
The Agreement for Sale in Clause 1(a) suggest that
covered car park can be sold to the allottee and price
of such car park can be mentioned separately in the
agreement.
KARNATAKA (DRAFT)
open car park available in the project.
The Agreement for Sale in Recital L suggest that closed
car park can be sold to the allottee and price of such car
park can be mentioned separately in the agreement.
open car park available in the project.
As opposed to Delhi and Karnataka, the rules provide
that covered parking can be sold.
TAMIL NADU (DRAFT)
open car parks available in the project.
As opposed to Delhi, Karnataka and UT, the rules
provide that covered parking can be sold.
The Agreement for Sale in Recital L also suggest that
closed car park can be sold to the allottee and price
of such car park can be mentioned separately in the
agreement.
WEST BENGAL (DRAFT)
*
Most state rules do not define or give details of covered car parking

Declaration of non-discrimination
Updating status of construction with photographs on the website
The promoter shall not discriminate against any allottee
at the time of allotment of any apartment, plot or
building, as the case may be.
KARNATAKA (DRAFT)
TAMIL NADU (DRAFT)
building.
WEST BENGAL (DRAFT)
building.
Each building, floor, internal infrastructure and common
areas.
Silent
KARNATAKA (DRAFT)
areas.
areas.
TAMIL NADU (DRAFT)
areas.
WEST BENGAL (DRAFT)
areas.
areas.

Submission of land title search report
Submission of no encumbrance certificate
From an advocate with experience of at least 10 years.
From an advocate in practice.
KARNATAKA (DRAFT)
From an advocate with experience of at least 10 years in
land-related matters.
land related matters.
TAMIL NADU (DRAFT)
Silent
WEST BENGAL (DRAFT)
land-related matter.
DELHI (IN FORCE)
Through an advocate with experience of at least 10 years
from the revenue authority not below the rank of the
tehsildar.
Non-encumbrance certificate through an advocate having
experience of at least 10 years from the revenue authority
not below the rank of tehshildar.
KARNATAKA (DRAFT)
From the concerned sub-registrar through an advocate
with experience of at least 12 years in land-related
matters.
UTs (IN FORCE)
Non-encumbrance certificate through an advocate having
experience of at least 10 years from the revenue authority
not below the rank of tehshildar.
TAMIL NADU (DRAFT)
Updated encumbrance certificate, extract/certificate of
Revenue Authorities reflecting the title of the promoter
to the land on which development is proposed.
WEST BENGAL (DRAFT)

Submission of income tax returns
DELHI (IN FORCE)
Authenticated copy of the PAN card.
Annual report including profit and loss account, balance
sheet, cash flow statement, directors’ report and the
auditors’ report for the preceding 3 financial years.
If annual report is not available then the audited profit
and loss account, balance sheet, cash flow statement,
directors’ report and the auditors’ report for the
preceding 3 financial years.
Income tax returns of the preceding 3 financial years.
KARNATAKA (DRAFT)
Authenticated copy of the PAN card.
Income Tax Returns for preceding three financial years.
Audited balance sheet for the preceding financial year.
In case of a newly incorporated or registered entity -
annual returns of the parent entity for the preceding 3
financial years.
Authenticated copy of PAN card.
Income Tax Returns for preceding 3 financial years.
financial years.
UTs (IN FORCE)
Annual report including profit and loss account, balance
sheet, cash flow statement, directors’ report and the
auditors’ report for the preceding 3 financial years.
If annual report is not available then the audited profit
and loss account, balance sheet, cash flow statement,
directors’ report and the auditors’ report for the
preceding 3 financial years.
TAMIL NADU (DRAFT)
Audited balance sheet of the promoter firm/company for
the preceding financial year and income tax returns of the
promoter firm/company for 3 preceding financial years.
WEST BENGAL (DRAFT)
Income tax returns for preceding 3 financial years.
financial years.
Income tax returns for preceding 3 financial years.
financial years.

Rate of interest (Promoter and allottee)
State Bank of India highest marginal cost of funds-based
Lending Rate + 2%.
Provided that in case the State Bank of India highest
marginal cost of funds-based lending rate is not in use
it would be replaced by such benchmark lending rates
which the State Bank of India may from time to time for
lending to the general public.
State Bank of India’s highest marginal cost of lending rate
plus 2%
KARNATAKA (DRAFT)
lending Rate + 2%
No rate specified
TAMIL NADU (DRAFT)
Repo rate of RBI plus 2 %
WEST BENGAL (DRAFT)
lending rate + 2%
lending rate + 2%

Timelines for refund by promoter
Within 45 days from the date on which the refund along
with applicable interest and compensation becomes due.
with applicable interest and compensation becomes due
and payable.
KARNATAKA (DRAFT)
TAMIL NADU (DRAFT)
The rule further provides that the entitling allottee shall
get full refund at any time if the builder has not followed
the time schedule. The builder shall not keep 10 per cent
of the booked value of the property.
WEST BENGAL (DRAFT)

Promoter cannot withdraw penalty, interest and compensation from a
separate account
The Authority may in the interest of the allottees, inquire
into the payment of amounts imposed as penalty, interest
or compensation, paid or payable by the promoter, in
order to ensure that the promoter has not withdrawn the
said amount from a separate account.
The Act or rule does not clarify whether in the event
of termination of the agreement, will the promoter be
permitted to withdraw 70 per cent of the amount received
from the allottee from the separate account toward
refund of such amount to the allottee in the manner
prescribed under the rules.
Silent
KARNATAKA (DRAFT)
Same as Delhi
Same as Delhi
TAMIL NADU (DRAFT)
Same as Delhi
WEST BENGAL (DRAFT)
Same as Delhi
Same as Delhi

Compounding of offences
DELHI (IN FORCE)
In case of Promoter - Offence punishable with
imprisonment can be compounded by paying 10 per cent
of the estimated cost of the real estate project;
In case of Agent - Offence punishable with
of the estimated cost of the plot, apartment, or building
as the case may be of the real estate project for which the
sale or purchase has been facilitated.
In case of Allottee - Offence punishable with
as the case may be.
(in case of violation of order of Authority) and 5 per cent
(in case of violation of order of Appellate Tribunal) of the
estimated cost of real estate project which may extend up
to 10 per cent.
of the estimated cost of the plot, apartment or building,
as the case may be, of the real estate project, for which
the sale or purchase has been facilitated, which may
extend up to 10 per cent.
of the estimated cost of the plot, apartment or building,
as the case may be, which may extend up to 10 per cent.
KARNATAKA (DRAFT)
as the case may be.
In case of Promoter - Offences punishable with
imprisonment under the Act shall be compounded
by paying money proportionate to the term of
imprisonment subject to maximum of 10 per cent of the
estimated cost of real estate project for 3 years.
In case of Agent - Offences punishable with
estimated cost of plot, apartment or building for 1 year.
In case of Allottee - Offences punishable with
estimated cost of plot, apartment or building for 1 year.

UTs (IN FORCE)
as the case may be.
TAMIL NADU (DRAFT)
as the case may be.
WEST BENGAL (DRAFT)
as the case may be.
as the case may be.

PROVISIONS WHERE ACT IS SILENT
Overlap with certain special Acts
Special Acts may have an overriding effect. However, there is an overlap
of rules. This needs further clarification which is important to safeguard
the interests of developers as well as consumers.
Compliance related to mixed projects
There is no clarity on the type of project and their definition – whether
the project is a mixed, standalone residential or commercial or a large
scale township. For instance, a certain portion of a mixed land use project
or a particular tower of a large township project can be treated as a single
project.
Change of guard during the ongoing projects
A number of times companies sell stakes or a portion of the project to a
private equity fund. As a result, the management changes. Act is silent on
its impact and the eventuality.
Structural defect and the ones induced by allottees
There is a no mention of structural defects introduced by allottee after
occupation certificate has been issued.
Withdrawal from separate account at the time of refund
In case of termination, where the promoter is required to refund the
instalments received from the allottee, it is not clear if the promoter will
be permitted to withdraw from the separate account 70 per cent of the
realisations received from the allottee.

About us
About FICCI
Established in 1927, FICCI is the largest and oldest
apex business organisation in India. Its history is closely
interwoven with India’s struggle for independence, its
industrialisation, and its emergence as one of the most
rapidly growing global economies.
A not-for-profit organisation, FICCI is the voice of
India’s business and industry. From influencing policy
to encouraging debate, engaging with policy makers and
civil society, FICCI articulates the views and concerns of
industry. It serves its members from the Indian private
and public corporate sectors and multinational companies,
drawing its strength from diverse regional chambers of
commerce and industry across states, reaching out to over
250,000 companies.
FICCI provides a platform for networking and consensus
building within and across sectors and is the first port of
call for Indian industry, policy makers and the international
business community.
For more about FICCI, please contact:
Mousumi Roy
Senior Director Head
Real Estate, Urban Infrastructure Smart Cities
Sachin Sharma
Sr. Asst. Director
Sachin.sharma@ficci.com
+91 96431 58335
Shaily Agarwal
Asst. Director
Shaily.agarwal@ficci.com
+91 11 2348 7577

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The Firm has a strength of over 500 fee-earners including
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M: +91 98338 44440

Yes
No
Maybe
59.46%
8.11%
32.43%
Results of a survey conducted during the second half of 2016
1. Post implementation of RERA, what the are major changes that you expect to see while making
real estate dealings?
2. As an investor in real estate, do you think RERA will boost the governance hold on the sector and
eventually lead to increase in foreign (FDI) and domestic investments into the sector in near future?
64.86%
Transparency and authority
Long process time
Same as earlier
17.57%
17.57%
More than 60% of the respondents feel that,
going forward, transparency will increase in real
estate dealings
Close to 60% of the respondents feel that RERA
will increase the governance hold in the sector
and lead to increased investments
Annexure – How will RERA
impact the sector and stakeholders

Yes
No Maybe
56.76%
25.68%
17.56%
50.00%28.38%
21.62%
Increased ease of availability
of finance options
3. Post RERA implementation, what changes do you expect in lending options from
bankers/institutions?
4. The Act provides for lot of transparency to be maintained by the developers. Do you think
these practices will reduce litigation going forward?
More stringent approach
from the lenders
Same as earlier
Approximately 50% of the
respondents hope that the lending
options from lenders will improve
and availing finance will be easier.
More than 50% of the respondents believe that RERA will reduce litigations

39.19%
21.62%
8.11%
10.81%
2.70%
5.41%
12.16%
5. What is your opinion on the rule of depositing 70 per cent of sales proceeds in a separate
account? (can choose any two)
• It will help in getting timely delivery of the project
• This will lock the cash and force the builders to rely on further borrowings, which will eventually lead to higher
project cost
• It will help in eliminating the fly-by-night operators in the real estate sector
• No major change
b. This will lock the cash and force the builders to rely on further
borrowings, which will eventually lead to higher project cost
c. It will help in eliminating the fly-by-night operators in the real estate
a. It will help in getting timely delivery of
the project
b. This will lock the cash and force
the builders to rely on further
borrowings, which will eventually lead
to higher project cost
a. It will help in getting timely delivery
of the project
c. It will help in eliminating the fly-by-
night operators in the real estate
a. It will help in getting timely delivery of the project
b. This will lock the cash and force the builders
to rely on further borrowings, which will
eventually lead to higher project cost
c. It will help in eliminating the fly-by-
night operators in the real estate
d. No major change
Close to 40% of the respondents feel that the implementation of RERA will help timely delivery of projects and also
eliminate non- serious players from the sector

24.32 | 14.87 | 21.62 | 9.46
1.35 | 4.05 | 8.11 | 77.03
35.14 | 20.27 | 21.62 | 1.35
16.22 | 31.08 | 27.03 | 5.41
22.97 | 29.73 | 21.62 | 6.75
27.03%
14.86%
21.62%
18.92%
17.57%
6. Where do you see the maximum impact of RERA in the operations of your
Company? (Rank 1 -5)
Project Planning and Design
Any other
Working Capital Management
Marketing and Customer Management
Project Construction and Development
Rank 1
Rank 3Rank 2 Rank 4 Rank 5
More than 40% of the respondents believe that maximum impact will be in the area of project planning and construction

Editorial and review
Devesh Chandra Srivastava
Rohit Nautiyal
Design
Gourav Kalra
Mrityunjay Gautam
For further information, please write to:
REC@IN.GT.COM
Acknowledgement

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Real Estate (Regulation & Development) Act (RERA) – The State Affair

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