In order to promote planned and healthy real estate development of colonies and apartments with a view to protecting consumer interest on the one hand and to facilitate smooth and speedy urban construction on the other; Ministry of Housing & Urban Poverty Alleviation has drafted a draft Model Real Estate (Regulation of Development) Act 200_____. The draft bill can be accessed on the website of the Ministry (http://mhupa.gov.in) under “What is new” ticker.
The draft bill seeks to establish a Regulatory Authority and an Appellate Tribunal to regulate, control and promote planned and healthy development and construction, sale, transfer and management of colonies, residential buildings, apartments and other similar properties, and to host and maintain a website containing all project details, with a view to protecting, on the one hand the public interest in relation to the conduct and integrity of promoters and other persons engaged in the development of such colonies and to facilitating on the other the smooth and speedy construction and maintenance of such colonies, residential buildings, apartments and properties and for matters connected therewith or incidental thereto.
The bill provides for compulsory registration with the Regulatory Authority for development of land into a Colony of plots or construction of a building or conversion of any existing building or part thereof into apartments, for the purpose of marketing all or some of the apartments, except when the area of land proposed to be developed into a colony does not exceed one thousand square meters or the number of apartments proposed to be constructed does not exceed four.
The bill also provides that no promoter shall issue or publish an advertisement or prospectus, offering for sale any plot, building or apartment, or inviting persons who intend to take such plots, buildings or apartments to make advances or deposits without registering with the Regulatory Authority and without first filing a copy of the advertisement or prospectus in the office of the Regulatory Authority. The bill also has provisions for:
a. Responsibility of the Promoter to enter all record or details on the website of the Regulator;
b. Responsibility of promoters regarding veracity of the advertisement or prospectus;
c. No deposit or advance to be taken by promoter without first entering into an agreement of sale;
d. Responsibility of Promoter to take measure for protection and safety of property;
e. Responsibility of the Promoter regarding the account of sums taken from or on behalf of the allottees;
f. Responsibility of the promoter to the allottees during project period etc.
Comments/suggestions on the draft bill were invited from public and other stakeholders till 06.11.2009 through issue of public notice, as also through communications to States/UTs, business chambers etc. Comments from 77 stakeholders have been received. However, States/UTs have not responded in the matter and being reminded.