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“If Developers Fail To Get Registered Before End Of July, Show Cause Notices Will Be Issued”



MUMBAI: Former state government bureaucrat Gautam Chatterjee, who took over as chairman of the Maharashtra Real Estate Regulatory Authority (RERA ), tells Nisha Nambiar that if developers fail to get registered before the end of July, show cause notices will be issued on the basis of online complaints from August 1. 


Excerpts from Chatterjee’s exclusive interview with TOI. Only nine developers have registered with RERA in the last three weeks. Has the progress been at a snail’s pace? 

It has been as expected. We need to give them time to examine the rules, get all documents in place as well as overcome the fear of sharing all details in the public domain. Moreover, it would take some time for them to get all the certificates from the professionals — architects, chartered accountants, civil engineers and others. 

We got a good response from real estate agents. They registered before the developers and their number has already touched 600. But I would say that we need not be perturbed by the initial numbers. 

1. What are the glitches they are facing? 
The developers complained of some technical glitches, which have been addressed. Besides, there are some self-proclaimed experts who are trying to help out developers and are only creating confusion. 


This, too, has been addressed through the help desk and helpline facilities through the website. Incidentally, Maharashtra is the first to have the entire process online. So we expect less footfall in the office. 

2. How many registrations do you expect in the next three months? 
The numbers may have been dismal initially, but are bound to steadily increase. By the end of May, the numbers should touch the double digits and by next month, we should be crossed the 1,000-mark. Everyone should get registered by July because the penalty is too high. 

Those who think they can escape by not registering are living in a fool’s paradise. 

3. From when will you start taking action against developers for non-registration? 

After the 90-day period. From August 1, cognizance will be taken for every complaint registered by any consumer reporting any case of non-registration. An action would be taken for complaints about projects registered with RERA. 

4. What has been the developers and consumers’ concerns at the workshops? 
For the developers, the stress will be on registration with RERA for the ongoing and new projects. I essentially have to don two roles for the developers — that of an administrator and of an adjudicator. 

As an administrator, stress is on registration so that they come in the ambit of RERA. Later, if there are any complaints registered against them, I have to hear these complaints as an adjudicator. For the consumers, they are more aware about the project through RERA before they invest. Real estate agents cannot operate if they do not register with RERA. 

5. Would you appoint two members immediately in Pune and Nagpur as well? 
At present, we have three members. Depending upon the number of cases we get, we should have offices in Pune and Nagpur as well. The government can appoint as many members depending on the number of cases. 

The government rules state that these members can be independent authorities to hear the cases. It is not necessary for the chairman to hear every case.

Source: Economic Times

Also Read: National Urban Rental Housing Draft Policy 2017 – Is There Any Relief?


373 Maharashtra Cities To Fall Under PMAY Scheme




The state of Maharashtra has added 232 cities to the existing 142 which makes it 373 cities under the Pradhan Mantri Awas Yojana Scheme (PMAY).

The officials at the housing department feel that this step will aid the government take up more projects under the PMAY scheme.

Sachin Kulkarni, Builder shared his concerns over the lack of coordination between the department in executing PMAY projects. He said, “This is a good sign. However, the PMO’s seriousness in promoting HFA is diluted by the time it reaches the authorities. Apart from collecting application from interested beneficiaries, nothing has moved on the ground in urban centres. I hope that this initiative moves on fast track”.

Maharashtra CM Devendra Fadnavis recently states that the in order to create more housing stock the state’s Slum Rehabilitation Authority scheme be brought under PMAY so that it can receive the subsidy to create more affordable housing. He clearly mentioned that the government intends to create more housing stock and it was taking various initiatives and making policy changes for it.

Also Read- Affordable Housing To Get A Boost With PMAY’s Scope To Be Extended To Private Lands

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Real Estate Sector May Fall Under GST What Does It Mean For Buyers?




One after the other the real estate sector has witnessed massive policy and law changes in its systems. Nonetheless, the tide has not passed yet. The GST council will take up a proposal to bring it under the uniform nationwide levy.

As the industry is still recovering from the RERA Act, the finance minister, Arun Jaitley said that there is a strong case to include real estate in the new indirect tax regime. He said this last week and also mentioned that GST Council will discuss it in November.

At present, the home buyers are paying 12 percent GST on under-construction properties. This percentage includes two taxes which are stamp duty and registration. The rate of which varies in each state but GST will make them uniform.

Santosh Dalvi, KPMG India partner (indirect tax) said, “If the entire real estate is brought under GST, they would have to abolish the stamp duty and we don’t know how the government plans to compensate the states for their loss.”

The stamp duty with registration and GST comes to approximately 18 percent for under construction properties. He further said, “So, it’s important to look at what rate it will be taxed at. We can then look at consumer prices”.

While agreeing, Bipin Sapra, EY partner (indirect tax), added, “It’s going to be a test for the government”.

Developers also pay taxes on raw materials. However, unlike other businesses, they don’t get any tax refunds through input credit. GST taxes every stage of the business activity to better compliance and compensates for it by permitting refunds.

Anuj Puri, Anarock Property Consultants chairman, said “By including real estate under GST, builders can get a fair amount of input credit, helping bring down costs,” He added that it would make homes cheaper for buyers.

According to Sapra, it will depend on the tax rate applicable.

Niranjan Hiranandani, co-founder of Hiranandani Group said, “Real estate under GST ambit means consumers will only have to pay one final tax.” He stated that with the commencement of RERA it brings transparency and GST would reduce the burden in terms of taxes payable while buying the home. He concluded, “Not only will this create positive sentiment but it should also boost actual sales”.

Also Read: Affordable Housing Is The Changing Face Of Indian Real Estate

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Home Buyers Will Be Covered Against Builders Who Are Going Bankrupt




In a move to protect home buyers from builders declaring their bankruptcy, the Insolvency & Bankruptcy Board of India (IBBI) has amended rules which make it necessary for any company to showcase how they have dealt with interests of all stakeholders. This is directed towards companies like Jaypee Infratech and some of the entities of Amrapali Group.

The regulator has informed about the revised rules last week. This will ensure that banks and other creditors do not get away by protecting their interests at the expense of others who are impacted by the action.  Banks are part of the creditors’ committee. They become an important decision-making body after a company is admitted for bankruptcy.

An expert bankruptcy lawyer said, “The change in the rules has plugged a gap as flat buyers are of the view that there is nothing to protect their interests.”

According to the new law that was enacted last year intends to speed up the resolution process in a period of 180 days, with a possible extension of 90 days. This will be done by appointing insolvency resolution professionals who will take charge of the company’s operations and prepare a plan. As per the law, an information memorandum will be finalized if the creditor’s committee is willing to take applications from other interested companies to take over the company.

The insolvency experts say that the law providing for the plan binds corporate debtor (the company) and its members, employees, guarantors, and creditors, other stakeholders involved in the resolution plan. However, there are no obligations mentioned in the rule to give any treatment to the stakeholders other than the financial creditors (banks) and operational creditors, which includes vendors and others who may have dues.

The National Company Law Tribunal, based on the comfort provided by the revised rules, will choose the final resolution plan based on bids that are received. The lawyer further said, “The tribunal will not clear the resolution plan without giving notice to all stakeholders and the flat buyers can raise objections at that point of time.”

Also Read: Tanvi Group Fail To Deliver Homes And Declare Bankruptcy

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