Real Estate (Regulation and Development) - Law

1. Real Estate (Regulation and Development) - Law CA Yash Nagar

2. Coverage • Legal overview of MAHA RERA • Registration at www.maharera.mahaonline.gov.in • Representation before Authorities • Consultancy

3. Additional References • The Real Estate (Regulation And Development) Act, 2016 • Maharashtra Real Estate (Regulation and Development)(Registration of Real Estate Projects, Registration of Real Estate Agents, Rates of Interest and Disclosures on Website) Rules, 2017 • Maharashtra Real Estate (Regulation and Development) (Recovery of Interest, Penalty, Compensation, Fine payable, Forms of Complaints and Appeal, etc.) Rules, 2017 • MahaRERA General Regulations 2017

4. Preamble – 25/03/2016 and 01/05/2017 • An Act to establish the Real Estate Regulatory Authority for regulation and promotion of the real estate sector and to ensure sale of plot, apartment or building, as the case may be, or sale of real estate project, in an efficient and transparent manner and to protect the interest of consumers in the real estate sector and to establish an adjudicating mechanism for speedy dispute redressal and also to establish the Appellate Tribunal to hear appeals from the decisions, directions or orders of the Real Estate Regulatory Authority and the adjudicating officer and for matters connected therewith or incidental thereto.

5. Key Impact Areas: Business Practices • Registration of Project: • Registration of all new and ongoing projects and prohibition on marketing and selling before registering the project. Disclosure of Project Status: Project details to be updated on website of Authority: apartments booked, approvals obtained, Construction progress etc. • Utilization of Funds: • 70% of receipts to be used for construction and land cost only and to be deposited in separate bank account. • Promoters’ Responsibilities: • Responsibilities towards obtaining completion certificate, maintenance, formation of society, conveyance deed etc. Registered Agreement for Sale: Mandatory for accepting sum more than 10% of cost of apartment, plot or building as an advance payment or application fee. • Rights and Duties of Allottees: Refund along with interest in case of delay, non-completion of project or non adherence with the terms and conditions. • Consent of buyer for modifications: Specific consent of buyer and written consent of two-thirds of allottees for any changes other than minor additions or alterations. • Defect Liability Period: • Rectification of defects or fulfilment of obligation if brought to notice within 5 years from date of possession. Real Estate Agents: Requirement of registration of RE agents with RERA authority. Registration number to be quoted in every sale facilitated.

6. Legal

7. Registration –Min. 6 to 7 days www.maharera.mahaonline.gov.in Sec • No promoter shall advertise, market, book, sell or offer for sale, or invite persons to purchase in any manner any plot, apartment or building, as the case may be, in any real estate project or part of it, in any planning area, without registering the real estate project with the Real Estate Regulatory Authority established under this Act 3

8. Exemption • (2) Notwithstanding anything contained in sub-section (1), no registration of the real estate project shall be required— • (a) where the area of land proposed to be developed does not exceed five hundred square meters or the number of apartments proposed to be developed does not exceed eight inclusive of all phases: Provided that, if the appropriate Government considers it necessary, it may, reduce the threshold below five hundred square meters or eight apartments, as the case may be, inclusive of all phases, for exemption from registration under this Act; • (b) where the promoter has received completion certificate for a real estate project prior to commencement of this Act; • (c) for the purpose of renovation or repair or re-development which does not involve marketing, advertising selling or new allotment of any apartment, plot or building, as the case may be, under the real estate project. • Explanation.—For the purpose of this section, where the real estate project is to be developed in phases, every such phase shall be considered a stand alone real estate project, and the promoter shall obtain registration under this Act for each phase separately.

9. Section 4 • Every promoter shall make an application to the Authority for registration of the real estate project in such form, manner, within such time and accompanied by such fee as may be specified by the regulations made by the Authority.

11. Registration - maharera.mahaonline.gov.in CA Yash Nagar

12. Registration - maharera.mahaonline.gov.in CA Yash Nagar

13. Documents Required • KYC • Layout Plan • Building Plan • Commencement Certificate • Form B • Encumbrance Certificate • Form 1,2 and 3 • Bank Account Details • Legal Search Report • Agreement to Sale / Allotment Letter

16. What after Registration • Quarterly Update • Cost • Booking • % of Work Progress • Form 2A • Audit Form 5 • Completion of Project Form 4 • Disclosure of Professionals • GIS Updation

17. Litigation

18. Maharashtra Real Estate Appellate Tribunal

19. Right to legal representation – Form 6 • The applicant or appellant may either appear in person or authorise one or more chartered accountants or company secretaries or cost accountants or legal practitioners or any of its officers to present his or its case before the Appellate Tribunal or the Regulatory Authority or the adjudicating officer, as the case may be.

20. Filing of complaints with the Authority or the adjudicating officer. • Any aggrieved person may file a complaint with the Authority or the adjudicating officer, as the case may be, for any violation or contravention of the provisions of this Act or the rules and regulations made thereunder against any promoter allottee or real estate agent, as the cae may be. • Explanation.—For the purpose of this sub-section "person" shall include the association of allottees or any voluntary consumer association registered under any law for the time being in force. • (2) The form, manner and fees for filing complaint under sub-section (1) shall be such as may be specified by regulations.

21. Procedure Circular 9/2017 and 18/2017 • Form A • Form B

22. Rectification of orders • The Authority may, at any time within a period of two years from the date of the order made under this Act, with a view to rectifying any mistake apparent from the record, amend any order passed by it, and shall make such amendment, if the mistake is brought to its notice by the parties: • Provided that no such amendment shall be made in respect of any order against which an appeal has been preferred under this Act: • Provided further that the Authority shall not, while rectifying any mistake apparent from record, amend substantive part of its order passed under the provisions of this Act.

23. Establishment of Real Estate Appellate Tribunal. – Sec 43 • (5) Any person aggrieved by any direction or decision or order made by the Authority or by an adjudicating officer under this Act may prefer an appeal before the Appellate Tribunal having jusrisdiction over the matter: • Provided that where a promoter files an appeal with the Appellate Tribunal, it shall not be entertatined, without the prmoter first having deposited with the Appellate Tribunal atleast thirty per cent. of the penalty, or such higher percentage as may be determined by the Appellate Tribunal, or the total amount to be paid to the allottee including interest and compensation imposed on him, if any, or with both, as the case may be, before the said appeal is heard. • Explanation.—For the purpose of this sub-section "person" shall include the association of allottees or any voluntary consumer association registered under any law for the time being in force.

24. Application for settlement of disputes and appeals to Appellate Tribunal – Sec 44 • (1) The appropriate Government or the competent authority or any person aggrieved by any direction or order or decision of the Authority or the adjudicating officer may prefer an appeal to the Appellate Tribunal. • (2) Every appeal made under sub-section (1) shall be preferred within a period of sixty days from the date on which a copy of the direction or order or decision made by the Authority or the adjudicating officer is received by the appropriate Government or the competent authority or the aggrieved person and it shall be in such form and accompanied by such fee, as may be prescribed: • Provided that the Appellate Tribunal may entertain any appeal after the expiry of sixty days if it is satisfied that there was sufficient cause for not filling it within that period. • (3) On receipt of an appeal under sub-section (1), the Appellate Tribunal may after giving the parties an opportunity of being heard, pass such orders, including interim orders, as it thinks fit. • (4) The Appellate Tribunal shall send a copy of every order made by it to the parties and to the Authority or the adjudicating officer, as the case may be. • (5) The appeal preferred under sub-section (1), shall be dealt with by it as expeditiously as possible and endeavour shall be made by it to dispose of the appeal within a period of • sixty days from the date of receipt of appeal: • Provided that where any such appeal could not be disposed of within the said period of sixty days, the Appellate Tribunal shall record its reasons in writing for not disposing of the appeal within that period.

25. Important Case Laws

26. APARNA ARVIND SINGH &ors. PANCHMUKHI BUILDERS AND DEVELOPERS • The Agreement for Sale did not incorporate date of possession will the Promoter be absolvent from liability to release any interest or compensation • Drawing balance sheet of above facts having scanned the legal position, the Allottee having parted with consideration prior to August, 2016, the impact would be liability of the Promoter to release the amount. The obligation cast on the Promoter having deceitfully avoided, the allottee is entitled to receive interest at 10.05% by way of compensation which is quantified at Rs.25,000/- per month from the last date of releasing payment till handing possession

27. VIVEK SHASHIKANT AGARWAL v. M/S. NIRMAN CONSTRUCTIONS & ABHIJEET RAMNATH GUNJAL • Promoter said he lost his father Mr. Ramnath Gunjal on 2nd February, 2017. The submission of present proprietor that it was a mess after death of his father for him to reconcile the documents and keep himself updated to completion of project, needs consideration. • The liability against the Promoter is for 38 months for interest @ 10.05% per annum. • After considering all the above facts, it was concluded that the appeal is partly allowed. The Promoter shall pay interest for a total past period of 26 months calculated upto 30th October, 2018 and shall also pay future interest at 10.05% till handing over possession of the flats to the Allottees / Appellant

28. LODHA BELLISSIMO CROWN BUILDMART PVT. LTD.v. HARESH JETHMAL ASHER • The point is that the promoter has a part completion certificate dated 8th June 2017 for the building. This is later than the implementation of RERA in Maharashtra i.e. 1st May 2017. Concession is extended by Section 3(1),the completion certificate obtained is later than the implementation of RERA in the State of Maharashtra which has come into force effective from 1st May, 2017. Even if concession is extended by Sec. 3(1) Proviso then also it will not automatically provide an elbow room or concession to the fact in issue as the part occupancy certificate is dated 8th June, 2017 later than 1.5.2017. • It is curious, that special conditions incorporated in part occupancy certificate also highlights that the applicant (promoter) shall complete the unfinished work before applying for full Occupancy Certificate of the building or before handing physical possession of the building for habitation whichever is earlier as ensured by the promoter in the Undertaking dated 26.5.2017

29. Ashutosh Bag v. THE Member and Adjudicating officer and others • The Award for compensation is not right and several factors needs to be considered.

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