Frequently Asked Questions

1       Possession Date

1.1     Can builder change possession date in RERA ?

1.2     What if builder delay possession of the apartment?

Many times home buyers ask questions such as: Can the promoter or developer change the date of possession under RERA act? What are the reliefs available to the buyer or allottee under RERA Act, if there is a delay in possession by the Builder? 

The allottee must note that the possession date is determined by the terms of the agreement for sale executed between the allottee and the builder.  

In the Delhi NCR region, the builders or the promoters give the possession date within four years from the date of signing of the agreement for sale.  In addition, the promoters add a clause for 6 months of delay period to compensate for the period which might have affected the construction activity within the region. 

However, under the RERA act 2016, the promoter has to pay the interest for every month of delay till the handing over of the possession to the allottee.  The interest rate will be at the rate prescribed by the state government of the state in which the project is registered.  In addition, for the compensation for delay, the promoter is liable to pay to the allottee compensation for failing to discharge any other obligations imposed on him in accordance with the terms and conditions of the agreement for sale.  

There is no such provision for the promoter to automatically extend the date of possession date.  In fact, under Section 18 of the RERA Act 2016, the allottee has the right to withdraw from the project if the promoter fails to complete or is unable to give the possession of an apartment or plot or building in accordance with the terms of the agreement for sale.

2       Requirement of Registration

2.1       Why RERA registration is important?

2.2       Why RERA is mandatory?

The RERA Act is enacted to achieve multiple objectives which are mainly:

1.    To regulate and promotion of the real estate sector;

2.    To ensure the sale of the home, plot, apartment or building in an efficient and transparent manner;

3.    To protect the interest of the consumers in the real estate sector;

4.    To establish an adjudicating mechanism for speedy dispute redressal; and

5.    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 with the RERA act

3       Applicability of RERA

3.1       Why RERA registration is required for the builders? Why RERA approval is required?

3.2       Is RERA registration mandatory for builders?

3.3       How RERA will benefit Builders?

The RERA registration for builders is no longer an optional registration. Under any real estate project, if the area of land proposed to be developed exceeds five hundred square meters or the number of apartments proposed to be developed exceeds eight inclusive of all phases of the project, the promoter or the developer has to register the project under RERA.

If the promoter does not register the projects with the RERA authority, then a heavy penalty can be imposed on the promoter. For example, if the promoter wishes to market the project prior to registration under RERA, the RERA authority may impose a penalty up to 10% of the estimated total project cost on the promoter for this first instance of violation.

However, if the area of the land proposed to be developed does not exceed 500 square metre or if the number of Apartments proposed to be developed is less than eight Apartments then this project needs not to be registered under RERA.

3.4       Is RERA applicable for plots?

Yes, if the area of the plots to be developed and sold exceeds 500 square metre then this project needs to be registered under RERA.

3.5       Where RERA is not applicable?

The RERA registration is not required in the following circumstances:

1.    if the area of the land proposed to be developed does not exceed 500 square metre, then the promoter does not require registration of the project.

2.    If the number of Apartments proposed to be developed is less than eight Apartments then this project needs not to be registered under RERA.

3.    The RERA registration is not required for purpose of renovation or repair or re-development which does not involve marketing, advertising selling or new allotment of any apartment, plot or building under the real estate project.

3.6       is RERA applicable in rural areas?

Yes, the threshold for RERA registration is not based on type of the area. Under any real estate project, if the area of land proposed to be developed exceeds five hundred square meters or the number of apartments proposed to be developed exceeds eight inclusive of all phases of the project, the promoter or the developer has to register the project under RERA.

4       Status of Current Projects registered under RERA

One can visit the website of the Real Estate Regulatory authority of the state in which the project is registered. Subsequently, all the details can be accessed online regarding the current status of the project.

5       Extension of RERA registration date

5.1       Can builder extend RERA date?

5.2       Can RERA date be extended?

Section 6 of the RERA Act 2016 provides an opportunity for the promoter to seek extension of the project completion date upto 1 year by filing an appropriate application before the RERA authority. However, the extension is not an automatic extension obtained by payment of fees. The RERA authority has to grant the extension only under the force majeure clause. This means that the authority will consider whether a case of war, flood, drought, fire, cyclone, earthquake or any other calamity caused by nature affecting the regular development of the real estate project has affected the promoter or not. Subsequently, the authority can decide the extension period.