Government plans real estate regulatory authority

The Haryana government is working towards setting up a Real Estate Regulatory Authority to regulate the booming real estate sector and prevent unscrupulous realtors from targeting property buyers. The state government is planning to bring a bill to set up the authority in the coming budget session scheduled to commence on February 22, said Rao Dan Singh, chief parliamentary secretary (town and country planning), Haryana, on Tuesday.

"As yet, the property buyers, in case of any dispute with the builders, have to approach the civil courts. After constitution of the proposed authority, they would be able to complain against the builders with the new forum. Apart from giving early relief to them, the authority would also reduce the burden of courts," said Dan Singh, adding the authority may be empowered with quasi-judicial powers.

Talking to TOI, R R Singh, an ex-Army officer and director general of National Real Estate Development Council (NAREDCO), said, "Any regulatory body should have a single window system for setting up guidelines and hear grievances of consumers. It should lay down procedures for reaching builder-buyer agreement, project deadlines for builders and even function as a quasi-court for redress of disputes. The body must also look into problems such as pre-launches of the projects by developers. The regulator should be the umbrella body heading all stake-holders in the sector, with an aim to streamline the various procedures."

When contacted by TOI in Gurgaon, developers said that a regulator must not further complicate and lengthen the existing procedures and add more windows issuing clearances.

The regulatory authority will be headed by a chairman and two members. According to a source, the authority would look into complaints pertaining to disputes related to sale and purchase of flats in housing societies.

Efforts are on to incorporate a provision for imprisoning builders in case of violation of the sales agreement norms related to cost and timeline, said a source adding that the Union government has suggested up to a year's imprisonment or fine up to 5% of the total project cost for violations.

In a similar law being brought by the Centre, the Union law ministry has reportedly proposed imprisonment up to three years or fine up to 10% of the project in case a builder doesn't register with the authority and the project land exceeds 1,000 square metres. The Union government will introduce the Real Estate (Regulation & Development) bill in parliament during the coming budget session.

"The Centre has issued broader guidelines to set up such authorities in all states and we will keep in mind the same before finalizing the draft bill for Haryana," said a Haryana government officer.

Principal secretary, Department of town and country planning , S S Dhillon, said, "We have prepared a draft proposal to seek approval of the chief minister before tabling it in the state assembly."

In the past few years, Haryana has witnessed major real estate activities especially in Gurgaon, Faridabad, Rohtak, Sonipat, Panipat and Rewari due to the state's proximity to the national capital.

Source (Tanushree Roy Chowdhury & Sukhbir Siwach, The Times of India, 6 Feb 2013) : "Government plans real estate regulatory authority."