Real Estate (Regulation and Development) Act, 2016 came into force on 1 May 2016. The much awaited and widely acclaimed Act sets up in motion the process of making necessary operational rules and creation of institutional infrastructure for protecting the interests of consumers.
It also promotes the growth of real estate sector in an environment of trust, confidence, credible transactions and efficient and time bound execution of projects.
Union Ministry of Housing and Urban Poverty Alleviation (HUPA) on 27 April 2016 notified 69 of the total 92 sections of the Act to bring it into force from 1 May 2016. This culminates the eight year long efforts in this regard.
A proposal for a law for Real Estate was first mooted at the National Conference of Housing Ministers of States and Union Territories in January 2009.
Special Features of the Act
• As per the notification, Rules under the Act have to be formulated by the Union and State Governments within a maximum period of six months from the act coming into force that is by 31 October 2016 under Section 84 of the Act.
• Real Estate Regulatory Authorities should be set up early. At these authorities all real estate projects are registered and Appellate Tribunals for adjudication of disputes is the key for providing early relief and protection to the large number of buyers of properties. These Authorities decide on the complaints of buyers and developers in 60 days time.
• The Act also empowers appropriate Governments to designate any officer preferably Secretary of the Department dealing with Housing, as the interim Regulatory Authority until the establishment of Regulatory Authority under the provisions of the Act.
• Regulatory Authorities, upon their constitution get three months time to formulate regulations concerning their day to day functioning under Section 85 of the Act.
• Likewise, Real Estate Appellate Tribunals shall be formed within a maximum period of one year that is by 30 April 2017. These fast track Tribunals shall decide on the disputes over the orders of Regulatory Authorities in 60 days time.
• The time limits of six months for formulation of Rules and one year for setting up Regulatory Authorities and Appellate Tribunals are the outer limit and the States willing to act quickly could do so and the Union Ministry of Housing & Urban Poverty Alleviation would notify the remaining Sections of the Act to enable relief to the buyers under the Act as quickly as possible.
• The remaining 22 Sections to be notified relate to functions and duties of promoters, rights and duties of allottees, prior registration of real estate projects with Real Estate Regulatory Authorities, recovery of interest on penalties, enforcement of orders, offences, penalties and adjudication, taking cognizance of offences etc.
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What: Came into force
When: 1 May 2016