Introduction
The Real Estate (Regulation and Development) Act (RERA) comes into effect in the year 2016. According to The Geeta's Saar Shlok "The main purpose of life is to meditate," which means that whatever we do must be done with concentration. In the same way, the developer shall be responsible to carry out a project and he will be accountable for all the obligations arising from it. Therefore the law was enacted to reshape the entire real estate sector through increased transparency and accountability. The act was validated to appropriately respond to cumulative issues in the sector while also attempting to balance the interests of stakeholders. It affirms guidelines for the development of businesses that require large upfront capital investments, having a basic focus on capital-intensive markets. Notability, central law was enacted to address the real estate sector's problem and to deal with unprofessionalism and non-standardization of the law.
Real estate act of 2016
RERA means real estate regulation and development act 2016. It was made in 2016 and was active with full force in 2017. Before the implementation of this act real estate sector in India was extremely unorganized and conjointly was underdeveloped and the interests of the vendee or client were not protected. So all this caused tension and confusion in this particular sector and the Parliament initiated this act. The motive of developing the RERA act is to establish a good developer and consumer relationship. RERA is applied on under-construction projects .they are either residential or commercial. All projects must get registered under the act except the re-development project. Projects before RERA without completion or occupancy certificate are to be registered under the act.
Notability of RERA act
A regulation like the RERA was necessary to revive confidence in our country's real estate sector, which is one of the main sources of income in our country, and a transparent government agency to look after the developer is needed. RERA provides a common platform to both buyer and developer to reduce the risk which previously people were exposed to. RERA is extremely important as it will apply to more than 76,000 companies across the country. This act maintains the number of things like project registration and real estate agents that have become compulsory now. A buyer has full rights to know every detail about a real estate project and has the right to receive all documents related to the project. RERA establishes a government agency that regulates both residential and commercial real estate transactions. RERA will ensure the timely delivery that is one of the biggest reliefs to buyers. RERA ensures more accuracy between developers and buyers and ensures transparency.
Impact on real estate
All brokers must be registered with the state-level real estate regulator.
Brokers in the unorganized sector must be licensed or declared bankrupt.
It is mandatory to develop codes of conduct for agents and agents must formalize all their transactions, thus putting an end to unfair commercial practices.
Developer cost will increase as now the next sale can only take place after registration
Judicial stand
Judicial pronouncements shook the sector and propelled it forward. Certain decisions were critical in shaping this sector and charting its progression.
Pioneer Urban Land and Infrastructure Ltd. and Anr. V. Union of India and Ors. (SC)
This judgment is seen as a major victory for home buyers, as the Hon'ble Apex Court upheld the reasonableness of Section 5(8)(f) of the Insolvency & Bankruptcy Code, 2016. Holding that homebuyers will now not only be able to invoke the Code but will also be able to sit on the committee of creditors alongside banks and other financial institutions.
This will impose an embargo that will serve as a deterrent to fraudulent real estate companies and developers who have failed to complete projects despite receiving large sums of money from homebuyers. The Court in addition then examined the RERA Act and concluded that "even through a process of harmonious construction, RERA and the Code must be held to coexist, and, in the event of a clash, RERA must give way to the Code." As a result, RERA cannot be considered a special statute that, in the event of a conflict, would supersede the general statute.
Navin Raheja vs. Shilpa Jain and Ors.
The question of delay in possession due to Force Majeure was adjudicated in this leading case, and it was concluded that in such circumstances, it cannot be claimed that the Corporate Debtor failed to deliver possession. The Court addressed the same stated that before admitting an application filed by an allottee(s) under Section 7 of the Insolvency and Bankruptcy Code, 2016, the Adjudicating Authority will consider the decision of the Hon'ble Supreme Court in Pioneer Urban Land and Infrastructure Limited & Anr. v. Union of India & Ors. If the delay is not due to the 'Corporate Debtor,' but to force majeure, as mentioned above, it cannot be claimed that the 'Corporate Debtor' failed to deliver possession
Conclusion
The act is a positive amendment in terms of growing transparency within the real-estate sector, increasing the answerableness of the promoters and developers, and establishing a well-organized forum for grievance redress. This may consequently result in lower proceedings because of strict rules and laws in the highly corrupt sector.
The past few decades have seen increasing attention given towards the constructive urbanization method in the context of the fast transformative process of the country because the nation strives to boost the capability to cope up with advancing needs through urbanization. In a country like India, a systematized Real Estate Regulation Act is necessary to possess uniform standards throughout the country and to bring transparency in transactions.
The implementation of laws such as RERA is a firm step in the right direction to raise awareness of future customers, developers, builders, etc. In the areas of RERA, cadastral modernization, land acquisition, and GST also for the growth of the real estate sector since the various actors such as builders, developers, brokers, and award winners have to adhere to the specification of projects, project agreements, and regulatory framework conditions.
It should also be noted that real estate companies must ensure that the properties of the allotter are maintained and that the residents are satisfied with the condition of the properties.
References
2. https://housing.com/news/rera-will-impact-real-estate-industry/amp/
4. https://youtu.be/iBl_-RLkjdQ
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