Maharashtra a step closer to getting a housing regulator

70% of the amount realised for a real estate project will have to be deposited in a separate account, to be maintained in a scheduled bank, towards land and construction costs

The BJP-led government in Maharashtra has formulated the draft Maharashtra Real Estate (Regulation and Development) (General) Rules 2016. This paves the way for formation of the Real Estate Regulatory Authority (RERA) and the Housing Tribunal. It would be mandatory for a realty project promoter to make all “disclosures”, including information and documents to be uploaded on the website of RERA. Every promoter will have to file a separate application for construction of each building or group of buildings.

Besides, 70 per cent of the amount realised for a real estate project will have to be deposited in a separate account, to be maintained in a scheduled bank, towards land and construction costs.

This apart, RERA will not entertain any application where the promoter has no title to the land, unless the agreement between the owner of the land and the promoter, authorising the latter to undertake the construction of the building, is duly registered.

The housing department official told Business Standard, “Framing of these rules was necessitated, following the enactment of the Real Estate (Regulation and Development) Act, 2016 which seeks to protect homebuyers and boost investments in the real estate industry. These draft rules were cleared on September 28 by the state law and judiciary department. Very soon, the department will release draft rules to seek suggestions and objections from stakeholders as final rules will have to be notified by October 31.”

According to the draft rules, the promoter will have to submit to RERA the approvals and Commencement Certificate from the competent authority if the project will be developed in phases. Additionally, copy of sanctioned plan, layout plan and specifications of the proposed project will also have to be submitted.

Besides, promoter will also submit copy of plan of development works to be executed in proposed project and proposed facilities to be provided thereof including fire fighting facilities, drinking water facilities, emergency evacuation services, use of renewable energy.

Moreover, the promoter will have to deposit 70 per cent of the amounts realised for real estate project from the allottees, from time to time, in a separate account to be maintained in a scheduled bank to cover the cost of construction of the project and the land cost.