Real Estate Act: Centre notifies rules for five UTs

The Ministry of Housing and Urban Poverty Alleviation has notified the Real Estate (Regulation and Development) (General) Rules, 2016, for the five Union Territories without Legislature — Andaman & Nicobar Islands, Dadra & Nagar Haveli, Daman & Diu, Lakshadweep and Chandigarh, an official statement said on Monday.

For registration of projects with the authorities by builders, the requirement of disclosing Income Tax returns, as proposed earlier, has been withdrawn in the final Rules – keeping in view the confidentiality attached with them and as pointed out by legal experts and promoters, the statement said.

The Centre has incorporated suggestions received from consumer associations and real estate bodies after placing the draft rules in public domain three months back.

The fee for registration of projects and real estate agents with regulatory authorities has been reduced by half, based on suggestions from promoters. For registration of projects, the fee has been reduced to ₹5 per square metre, for up to 1,000 sq m area and ₹10 per sq m beyond this limit – subject to a maximum of ₹5 lakh per project.

For commercial and mixed development projects, it will be ₹10 and ₹15 per sq. m subject to a maximum of ₹7 lakh. For commercial projects, it will be ₹20 and ₹25 subject to a cap of ₹10 lakh per project. For plotted development, it is ₹5 per sq. m with a ceiling of ₹2 lakh.

A cap has been placed on the total amount of registration fee based on the suggestion of real estate bodies, the rules stated.

Fee for renewing registration of projects with the regulatory authorities would be half of the registration fees. For registration of real estate agents, the fee now prescribed is ₹10,000 for individuals and ₹50,000 for other entities, as against ₹25,000 and ₹2,50,000 proposed in the draft rules. Similarly, fee for renewal of registration of projects and agents has also been reduced to ₹5,000 and ₹25,000 respectively.

Developers will be required to refund or pay compensation to allottees with an interest rate of SBI’s highest Marginal Cost of Lending Rate, plus 2 per cent.

The rules state that for ongoing projects that have not received completion certificate in specified time, developers will have to make public the original sanctioned plans, with specifications and changes made later, total amount collected from allottees, money used, original timeline for completion, etc.

“Real estate developers will have to furnish additional information regarding the ongoing projects for the benefit of the buyers besides depositing 70 per cent of the unused funds in a separate bank account to ensure their completion,” the statement said.

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