Centre tells states not to dilute RERA

Mumbai: The central government has warned chief ministers of all states that if they dilute the sections in Real Estate (Regulation and Development) Act, 2016, then the Act will serve no purpose. RERA is meant to streamline the fallacies in the real estate industry; however, there have been allegations that several state governments, including Mahahrashtra, have diluted stringent sections against developers, thus defeating the main aim of the Act. The central government has asked all state governments to notify the Act by May 1, 2017.

A statement by the central housing ministry on Sunday read: “The ministry has received some complaints of violations of some of the provisions of the Act by some of these states resulting in dilution of the spirit of the Act.

The ministry has referred the complaints to the committee on subordinate legislation of Rajya Sabha. In this backdrop, Union minister Venkaiah Naidu urged the chief ministers to ensure compliance with the Act, as passed by Parliament.

Activists from Maharashtra had questioned why they must pay 30 per cent of the total cost while signing the agreement and 45 per cent when the plinth of the building is constructed as against the central RERA, which states only 10 per cent.

In Maharashtra, one is required to pay Rs 10,000 to lodge a complaint or an appeal with the requisite authority as opposed to the Centre’s rules, which seek a fee of only Rs 1,000 while filing.

Maharashtra’s draft of the Act also did not mention that the developer would not discriminate against any allottee at the time of allotment of any apartment, plot or building. The Centre has made it binding for developers to not discriminate.

The statement further read: “Union minister Venkaiah Naidu in his two-page letter to the chief ministers has said that in the absence of rules and regulatory authority and appellate tribunal, the implementation of the Act would be affected in your state, leading to a vacuum in the sector. The real estate Act was one of the most consumer-friendly laws passed by Parliament and its timely implementation is the responsibility of both the central and state governments and this would not only provide the much needed consumer protection”. When contacted, chief minister Devendra Fadnavis and housing minister Prakash Mehta both were unavailable for comment.

Maharashtra had released its draft in public for suggestions and objections in December 2016. A senior state housing ministry official said, “Currently, the suggestions and objections are in process and the bill would be notified into Act after the code of conduct for civic and zilla parishad polls in the state.”

Further, in case of non-compliance with provisions of the Act, Maharashtra’s draft had no clause of imprisonment, but only fine. However, the Centre has decided on three years of prison over non-compliance by a developer and one year in case of estate agent.