News: RERA tells Delhi corporations not to approve unregistered building plans-27-05-2022
The decision came only days after the authority made it essential for builders to register projects with a total developed area of more than 500 square metres, regardless of the number of flats constructed on it.
The Real Estate Regulatory Authority (RERA) of Delhi has asked the city's four municipal corporation s and the Delhi Developme nt Authority (DDA) not to approve building plans for projects that have not been registered with the authority.
The decision came only days after the authority made it essential for builders to register projects with a total developed area of more than 500 square metres, regardless of the number of flats constructed on it.
Builders have been evading RERA registration by exploiting this loophole, and the authority has requested the cooperation of the municipal corporation to ensure transparency.
“If a builder is claiming the house he is constructing is for his own use, he has to give an affidavit for it,” Delhi RERA chairman Anand Kumar said. “In case he later sells it, that affidavit can be used to take action.”
As per Section 3 of the Real Estate (Regulation and Development) Act, 2016, all real estate projects under the
different categories are required to be registered with RERA, NCT of Delhi.
Real estate projects that are being developed on land areas of more than 500 sq m for the purpose of sale, either by way of construction of flats, commercial space, or office space, and projects in which more than eight apartments are being constructed in all phases for the purpose of sale, regardless of plot size, must be registered.
Legal experts said the order has touched upon an issue that needs to be looked into with much more granularity, especially from a homebuyer’s protection point of view.
“While the order has in a way ensured that projects will now have to be registered with RERA, limiting the process only to sanction may not be enough,” said Avikshit Moral, partner at IndusLaw. “Both the agencies should work together during the entire life cycle of the project. Any deviation or default that comes to the knowledge of one authority should be promptly communicated to the other, allowing them to take corresponding actions if needed.”
Delhi RERA has said homebuyers should only buy in RERA-registered projects and they are doing several checks to ensure every project in Delhi gets registered.
It has advised homebuyers to exercise more caution and conduct comprehensive diligence at the time of buying any property.
“There are multiple cases in south Delhi where the builder took the money but didn’t finish the work,” said a homebuyer who requested not to be identified. “Since these projects are not RERA-registered, builders avoid scrutiny and continue to make money. To avoid litigation, the buyer must invest in RERA-approved projects only.”
The authority has been receiving complaints from various home, commercial space and plot buyers as well as the public that many builders and developers are avoiding RERA registration of their projects in Delhi under various pretexts.
ET recently reported that property consultants in Delhi had asked Delhi RERA to make an order making registration mandatory for all projects built on 500 sq m or more of land, similar to one that Rajasthan RERA had made first.
Delhi RERA has also said if its order isn't followed, it will charge a fine of up to 10% of the estimated cost of the project.
The purpose of registration is to ensure transparency with regard to funds collected from allottees, completion and conveyancing of the property in favour of the allottees, and to ensure that the project has the necessary approvals and sanctions.
Most properties in Delhi’s posh colonies are in the range of Rs 20–100 crore, wherein existing owners, mostly elderly people, either sell or collaborate with developers.
