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No RERA Registration Number In Ads, Now A Violation Of The New Act

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No RERA Registration Number In Ads, Now A Violation Of The New Act

It is now mandatory for developers to give information about their projects 1st May onwards, as per a clause in the Real Estate Regulation and Development Act, Maharashtra (RERA)

Realtors will now have to display their RERA registration numbers in advertisements after 1st August 2017, stated the State RERA chairman Gautam Chatterjee.

It is now mandatory for developers to give information about their projects 1st May onwards, as per a clause in the Real Estate Regulation and Development Act, Maharashtra (RERA). This is to enable the consumers to check the offerings made to them and whether the builders are able to keep up to the promises that they have made. IT will also be mandate for all builders to update the details of all their ongoing projects.

Also, if the promoters have already received completion certificates (CC) or Occupational Certificate (OC) for renovation, repair or re-development before 1st of May, then the registration of the project is not needed. Each phase of each project can be uploaded and promoters are required to obtain registration under this ACT for each phase individually. The require documents and disclosures must be submitted to the authority online that will provide them with a registration number.

“The realtors have been given three months’ time from May 1 to complete the online registrations of their ongoing projects and also the new projects. After August 1, 2017, they will have to compulsorily mention the RERA registration number in their advertisements,” said Chatterjee.

“Since May 1, 900 agents and 16 projects have been registered in state. Yet I am not satisfied as there are at least 30,000 projects which need to be registered immediately,” he added.

After approval of the layout by the municipal corporation, the first building can be registered and the rest can follow.

“The disclosures will be made public using IT platform. The independent regulator will see if everything is being submitted. Hence, builders should tell the truth in the disclosure. If they do not, then, it will be violation of the Act,” Chatterjee said.

There is also a provision for fast track courts that will address the complaints and the case would be resolved within a stipulated 7 days. A case cannot go to multiple courts and has to go to only one court at once. The local government reserves the right to grant all kinds of permissions for new proposal under Right to Service Act.

Chatterjee believes that this act will empower people and it is a one of the most crucial decisions of the government today. The consumer is enabled to check the status and all other details of the project online. Any fault in compliance by the builder or violation of the Act can be lodged on the website itself. He also maintains that Real Estate is a vital industry for the country’s economy. He has also promised strict action against the violators and believes that those doing good and honest work will definitely flourish.

Chatterjee also emphasized how the main aim of the act is to give homes to those who don’t possess one yet. And those consumers, who are staying in houses without occupation/completion certificates for years, must get deemed conveyance done.

Also Read: CREDAI Seeks Abolition Of Stamp Duty On Landed Property After GST Implementation

Regulations

373 Maharashtra Cities To Fall Under PMAY Scheme

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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?

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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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Regulations

Home Buyers Will Be Covered Against Builders Who Are Going Bankrupt

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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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