Registration of Real Estate Project under RERA

The Real Estate (Regulation and Development) Act, 2016, widely known as the RERA Act, was enacted to regulate and promote transparency and accountability in the Indian real estate sector. One of the foundational pillars of this legislation is the mandatory registration of real estate projects with the Real Estate Regulatory Authority (“Authority”).

This article provides an in-depth and easy-to-understand explanation of the registration process under RERA. We will examine the relevant provisions, especially Sections 3 to 8 of the Act, covering who must register, exemptions, the application procedure, timelines, extensions, revocations, and consequences.

Understanding the Importance of Registration under RERA

Before we dive into the procedural details, it is essential to understand why registration is central to RERA.

The real estate sector in India has historically suffered from challenges such as project delays, lack of transparency in approvals, financial irregularities, and disputes between promoters and buyers. The RERA Act addresses these by enforcing strict norms on project registration and compliance.

• Legal Obligation: Under RERA, promoters are legally prohibited from marketing, advertising, selling, or inviting offers for any real estate project without registration.
• Transparency: Registration ensures that all critical project details, approvals, and timelines are made available to buyers via an official online platform.
• Buyer Protection: It safeguards buyers by mandating financial discipline, such as depositing 70% of advances in a separate escrow account to be used only for project costs.
• Accountability: Promoters are bound by declared timelines, and failure to comply can lead to penalties, fines, or even revocation of registration.

Thus, project registration acts as a checkpoint before a project enters the market, assuring buyers and authorities of the promoter’s credibility and adherence to rules.

Who Needs to Register? – Section 3 of RERA Act

Mandatory Registration Requirement

Section 3 clearly mandates that no promoter shall advertise, market, book, sell or offer for sale any plot, apartment or building in any real estate project without first registering the project with the Real Estate Regulatory Authority.

This requirement applies to:

• All new projects launched after the commencement of the Act.
• Ongoing projects without a completion certificate as on the commencement date.

Even if a promoter invites persons to purchase by any means, they must register.

Transitional Provision for Ongoing Projects

For projects already underway on the date the Act came into force (without completion certificates), promoters must apply for registration within three months from the Act’s commencement date. Failure to do so can result in penalties or restrictions.

Authority’s Power to Enforce Registration for Projects Beyond Planning Areas

Sometimes, a project may extend beyond the formal planning area but have permission from local authorities. In such cases, the Authority may, in the interest of allottees, direct promoters to register such projects under RERA. From that stage onwards, the Act’s provisions become applicable.

Exemptions from Registration

While registration is broadly mandatory, certain exemptions exist:

• Small Projects: If the land area proposed for development does not exceed 500 square meters or the number of apartments is 8 or fewer (including all phases), registration is not required. The State Government may reduce these thresholds if necessary.
• Completed Projects: Projects which have already received completion certificates before RERA came into force are exempt.
• Renovation/Repair: Projects involving only renovation, repair, or redevelopment without marketing or selling new units are exempt.

These exemptions aim to avoid overburdening small and already completed projects with additional regulatory requirements.

Phased Development and Registration

If a real estate project is developed in phases, each phase is considered a standalone project for registration purposes. The promoter must obtain registration separately for every phase. This prevents promoters from circumventing registration by fragmenting projects.

How to Apply for Registration? – Section 4 of RERA Act

Application Submission

Promoters must submit an application to the Authority in the prescribed form and manner, within the stipulated time, and accompanied by the required fees. The Act requires the Authority to establish an online web-based platform for applications within one year of its establishment, making the process efficient and transparent.

Documents and Details to be Submitted Along with Application

The application is not just a form but a comprehensive declaration about the project and promoter. The key documents and details include:

(a) Promoter’s Details

• Name of the enterprise.
• Registered address.
• Type of enterprise (whether proprietorship, partnership, company, or society).
• Registration particulars of the enterprise.
• Names and photographs of promoters.

(b) Past Projects Information

• Details of projects launched in the last five years, including current status.
• Details of any delays in completion.
• Details of cases pending against the promoter.
• Details of the type of land and payments pending.

(c) Approvals and Commencement Certificate

Authenticated copies of all required approvals from competent authorities for the project and each phase (if developed in phases).

(d) Sanctioned Plan and Specifications

Layout plan and technical specifications as sanctioned by authorities.

(e) Development Works and Facilities

Proposed development works and facilities, including fire-fighting, drinking water, emergency evacuation, and use of renewable energy.

(f) Location Details

Clear demarcation of land dedicated to the project with exact boundaries and latitude-longitude coordinates.

(g) Proforma of Documents to be Signed with Allottees

• Allotment letter.
• Agreement for sale.
• Conveyance deed.

(h) Details of Apartments and Garages

• Number and type of apartments, carpet area, balcony/verandah/open terrace areas.
• Number and area of garages for sale.

(i) Details of Key Personnel

Names and addresses of real estate agents, contractors, architects, structural engineers involved.

(j) Declaration and Affidavit by Promoter

The promoter must submit a declaration supported by an affidavit, confirming:

• Legal Title: The promoter has legal ownership or valid rights on the land proposed for development, backed by authenticated documents.
• Encumbrances: The land is free from encumbrances, or if any, full details of encumbrances including rights or interests of other parties.
• Completion Timeline: The time period within which the promoter undertakes to complete the project or phase.
• Segregated Account Compliance: Seventy per cent of the amounts received from allottees will be deposited in a separate account in a scheduled bank and will be used only for land cost and construction. Withdrawals will be proportionate to construction progress and certified by engineer, architect and chartered accountant.
• Audit: The promoter will get the account audited within six months of the end of every financial year and produce certified statements.
• Approvals: The promoter will obtain all necessary approvals timely.
• Additional Documents: Any other documents prescribed under rules and regulations.

(k) Any Other Information

The Authority may require additional information or documents as prescribed.

Grant of Registration – Section 5

Authority’s Duty and Timeline

Once the promoter submits the application along with all documents, the Authority has 30 days to:

• Grant Registration: If the application complies with the Act, rules and regulations, the Authority will issue a registration number along with a Login ID and password for the promoter’s project webpage on the RERA portal.
• Reject Registration: If the application is incomplete or non-compliant, the Authority will reject it with reasons in writing, after giving the promoter an opportunity to be heard.

Deemed Registration

If the Authority neither grants nor rejects the application within 30 days, the project is considered deemed registered. The Authority must then provide the promoter the registration credentials within the next 7 days.

Validity of Registration

The registration remains valid for the period declared by the promoter as the completion time for the project or phase. Promoters must complete the project within this timeframe or seek extension.

Extension of Registration – Section 6

Grounds for Extension

The promoter can apply for extension of the registration period if unable to complete the project on time due to force majeure events, including:

• War.
• Flood.
• Drought.
• Fire.
• Cyclone.
• Earthquake.
• Other natural calamities.

Procedure and Limitations

• Application for extension must be made in the prescribed form with payment of the prescribed fee.
• The Authority may grant extension, considering facts and reasons, not exceeding one year in aggregate.
• No extension application shall be rejected without giving the promoter an opportunity to be heard.

This protects promoters from unforeseeable circumstances while safeguarding buyer interests.

Revocation of RERA Registration – Section 7

Despite registration, the Authority can revoke registration for serious non-compliance or malpractices.

Grounds for Revocation

• Promoter’s default in complying with any provision of the Act, rules or regulations.
• Violating terms or conditions of approvals given by competent authorities.
• Indulging in unfair or deceptive practices, such as:
  • False or misleading statements or advertisements.
  • Claiming approval or affiliation that the promoter does not have.
  • Advertising services or projects not intended to be offered.
• Fraudulent practices.

Procedure

• The Authority must provide 30 days’ written notice to the promoter, stating grounds for revocation.
• The promoter has the right to present a cause or explanation.
• The Authority may, instead of revoking, impose additional terms and conditions to protect allottees.

Consequences of Revocation

• Promoter will be debarred from accessing the Authority’s website for that project.
• Name and photograph of the promoter will be published as a defaulter.
• Other State Authorities will be informed.
• The project’s bank account will be frozen.
• The Authority will facilitate the remaining development works, in consultation with competent authorities or allottees’ associations.
• The Authority may issue any other directions necessary for protecting public and allottee interests.

Authority’s Role After Lapse or Revocation – Section 8

When registration lapses or is revoked, the Authority must take steps to ensure the project is completed.

Actions the Authority May Take

• Consult the appropriate government.
• Carry out remaining development through:
  • Competent authority (government or municipal body).
  • Association of allottees, who have the first right of refusal to complete the work.
  • Any other method the Authority deems fit.

Legal Effectiveness

No direction or order under this section will take effect until the appeal period provided under the Act has expired.

Conclusion

The registration of real estate projects under the RERA Act is a transformative step toward a transparent, accountable and consumer-friendly real estate sector in India. The law mandates strict compliance from promoters and empowers buyers with access to verified information and effective grievance redressal mechanisms.