Penalty for Booking/Sale of units under Real Estate Regulation Development Act, 2016 in Gujarat
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- By Taxmann
- Last Updated on 4 March, 2022
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Regulation of the Real Estate Sector is governed by Real Estate Regulation and Development Act, 2016 and Relevant Rules. The Act came into force, with effect from 01.05.2016. By virtue of the RERA Act and relevant Rules, the RERA Authority has been assigned the power to suo-moto issue notices to promoters (Real Estate Developers) if the non-compliances are noted and accordingly orders for levying penalty are being passed within the framework of the relevant Act and Rules. On 27th & 28th October 2021, various such orders has been passed by Guj RERA Authority for violation of Section 3 read with Section 59(1) of Real Estate Regulation and Development Act, 2016 Act, by levying penalty on the Promoter for booking/selling the units of the Project without obtaining the RERA registration.
As per Section 3 of Real Estate Regulation and Development Act, 2016 “No promoter shall advertise, market, book, sell or offer for sale, or invite persons to purchase in any manner any plot, apartment or building, as the case may be, in any real estate project or part of it, in any planning area, without registering the real estate project with the Real Estate Regulatory Authority established under this Act”. Under Section 59(1) discretionary powers have been assigned to authority to levy penalty up-to 10% of the Estimated Project Cost and the Section is read as “59(1) If any promoter contravenes the provisions of section 3, he shall be liable to a penalty which may extend up to ten percent of the estimated cost of the real estate project as determined by the Authority”
How Guj RERA Authority is regularising the Real Estate Sector?
The real question is “How Guj RERA is tracking non-compliance of Section 3 and issuing suo-moto notices to promoters?”. The clear answer to this question is “details contained in Form 3 signed by Chartered Accountant” submitted at the time of registration of the project or “site visit”.
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