State finally okays RERA Act but 'spares' projects with 60 per cent completion
- Karnataka was the first state to notify the draft rules in last October but it took so many months to become an ACT
- The Act has exempted projects with 60 per cent completion status or more than that
- But there is no clarity on how the RERA Authority will determine the status of completion
FollowThe Siddaramaiah government - on Wednesday - at last approved the Real Estate (Regulation and Development) Act, 2016 which is expected to protect the home buyers against builders' harassment. However, the Act has decided to exclude the projects that are 60 per cent completed or have executed 60 per cent of the sale deed.
This has certainly not gone down well with both home-buyers and builders. While this has come as a 'blessing in disguise' to those builders who have already completed 60 per cent of the project, there lies a fraction of suspicion of how one will determine the status of the project, reports The Hindu. "This 60 per completion level can be manipulated by the developers," reports The Hindu quoting MS Shankar of Fight for RERA - Karnataka chapter. The Act also does not mentions the mechanism to determine the level of completion of project. Karnataka is the 14th state to adopt the RERA Act that aims at protecting the home-buyers and also encourage the genuine builders.
Although the state was the first to draft the rules last October, it took so many months to get the approval. However, a gazette notification will be issued in a week. Though Act has been modelled on the one implemented in Rajasthan government, it has largely adopted the Central law.
What does the Act say
The Act applies to projects with minimum 500 sq ft dimension or residential colonies with at least eight flats. The government has decided to exempt the projects that have completed 60 per cent or more than that. But below that level, the Act will be applied to all the ongoing projects, new projects, reports Kannada Prabha.
Under the RERA act, builders selling houses should be a registered entity and also their agents. The Act also mandates the registration of construction of houses and also mentioning the project's launch and completion date at the time of registration. The builders have to obtain a certificate to this effect from the RERA Authority, reports Kannada Prabha.
Violaters of the RERA rules will have to pay 10 per cent of their project cost to the Authority. Also, the agents - if proved guilty - will have face one year imprisonment and three years for developers.
