The Centre has urged the State Government to set up a State-level Real Estate Regulatory Authority (RERA).
Once a RERA is established, home buyers and customers of commercial estate can register their appeals against any form of cheating or misrepresentation by the real estate firms.
The Union Ministry of Housing & Urban Poverty alleviation (MoHUPA) has also asked the State Government to set up a State Appellate Tribunal for this purpose.
The MoHUPA, after notifying the Real Estate Regulation and Development Act, 2016, has already approved the Rules for implementation of the Act.
Accordingly, the State Government will frame Rules under this Act, and as per timeframe stipulated, the State Rules under the statute will come into force from May 1, 2017.
Under the prevailing Rules, the RERA can seek from a real estate developer details such as the nature of rights and interest of the promoter on the land which is to be developed, the area and location of the land as well as the layout plan of the project.
The RERA can also seek information and even evaluate the financial, technical and managerial capacity of the developer. The authority, according to the Act, may in the interest of the allottees, inquire into the payment of amounts imposed as penalty, interest or compensation, paid or payable by the promoter.
It will also be mandatory for the real estate promoter to get the accounts pertaining to a project audited within six months after the end of every financial year by a chartered accountant in practice.
The State Appellate Tribunal will adjudicate cases in a stipulated timeframe of 60 days.
All residential and commercial real estate properties that are over a minimum area of 500 square metre or have more than eight flats are to come under the purview of the legislation and these include projects beyond urban areas.
Under the Act, a builder faces imprisonment of up to three years and/or monetary fine while buyers and estate agents are liable for one-year imprisonment or/and a fine if they do not abide by the ruling of the appellate tribunal.
In order to discuss the issues at length, the MoHUPA has convened a meeting of the Secretaries of Housing & Urban Development of all States in New Delhi on January 17.
Issues regarding establishment of RERA, tribunal, constitution of a Real Estate Regulatory Fund and other issues would crop up during the deliberations, said sources.