The Real Estate (Regulation and Development) Act, 2016 or RERA is an effort to bring transparency and protect homebuyers in India's real estate market. RERA provides for serious penalties against the developers, real estate agents, and even the homebuyers for the violation of its regulations. Given below is a summary of what those penalties are:
1. Penalties for Developers (Promoters):
- Lack of project registration: An unregistered project under RERA by the developers attracts penalties of 10% of the cost of the project.
- A delay in possession: In case possession is delayed by the developer, a replacement fee has to be paid to purchasers and they may also be penalized up to 10% of the project cost.
- False advertisements: Engaging in promotion of projects in a manner that is not true may see a fine of 10% levelled on the cost of the project.
2. Penalties for Real Estate Agents:
- The agents are compelled to register with RERA so that they can practice legally. Non-registration will attract a fine of Rs.10,000 per day for non-compliance.
- Penalties for contravening the guidelines of RERA may go up to 5 % of the transaction amount.
3. Penalties for Non-Disclosure: Those developers who provide incomplete details of the project or fail to provide accurate ones can be fined or can be asked to modify their project details.
4. Penalties for Violating the Defects Liability Clause: If the developer does not rectify the defect within the specified time period, the developer will have to suffer penalties or be asked to return the buyer's money along with interest.
5. Consumer Redressal: Home-buyers can file complaints with the RERA for the non-compliant acts of the builders, ensuring that the violators are made to pay penalties.