After Pressure From Homebuyers, Karnataka RERA Releases Data Lists Of Registrations Rejected, Withdrawn Or Revoked
Lack of information leads to unsuspecting homebuyers investing money in projects which are rejected, withdrawn or even in registered projects that have expired.
In a push towards greater transparency, the Karnataka Real Estate Regulatory Authority (RERA) on Friday updated its website to reflect data lists of projects whose applications for registration have either been rejected, withdrawn or revoked.
The Karnataka RERA, which completed its fifth year on July 10, was established in 2017 after the state cabinet notified the Karnataka Real Estate Rules.
In the past, homebuyers have expressed dissatisfaction with the functioning of the body which was instituted with the motive of promoting transparency, financial discipline, accountability and protection of buyer rights in the real estate sector.
A particular cause for vexation was the lack of reliable data on the veracity of projects in the state. For instance, section 3(1) of the Real Estate (Regulation and Development) Act, passed by the Parliament in 2016, requires promoters to register their projects with the regulatory authority in order to sell, advertise, market, book or purchase them.
This requirement was mandated to ensure fair play and bring about standardisation in all real estate transactions across the country.
Consequently, section 34(c) of the Act imposes the duty upon the body to maintain a database of defaulters including photographs of the promoters for public viewing.
However, the Karnataka RERA webpage displayed no information detailing the names of projects which had no valid registrations.
Lack of access to such credible data used to hinder the interests of homebuyers and their ability to verify the credentials of the promoters or their projects.
MS Shankar, general secretary of The Forum for People’s Collective Efforts, an umbrella body of homebuyers, had described the consequences of this information gap.
He, in his letter to the Chief Minister B.S Yediyurappa and other key functionaries had stated:
Non-availability of such data amounts to the officials concerned providing an opportunity to unscrupulous promoters/builders to lead the real estate industry back to pre-RERA status by luring buyers to invest in projects that were rejected or withdrawn and registered projects that has expired.
The authority, in a bid to promote ‘caveat venditor’ (seller beware), as opposed to caveat emptor (let the buyer beware), is meant to perform rejection, withdrawal or revocation of registrations (or applications of registrations) when the builder has violated any of the RERA rules made to protect the interests of the buyer.
However, the true impact of this initiative can only be experienced when the buyers are able to perform their due diligence, for which the data lists become necessary.
The recently appointed RERA Chairman, HC Kishore Chandra, had recognised the issue and had promised to take effective measures to resolve the same.
He had stated: “I am also aware of the demand for disclosures. We will put such details on the website soon”. His words came to fruition on Friday when the RERA webpage displayed data lists on applications which were rejected, withdrawn or revoked for public viewing.
As of July 17, there are 5,077 applications for registration, 232 rejected applications and 32 applications whose registrations have been either withdrawn or revoked.
This development is the latest in the slew of measures taken by the regulatory body over the past month to further the interests of homebuyers, including the instruction to officials to reject or accept applications within 30 days, issuance of new guidelines that mandate consent of two-thirds of buyers for any modification in construction plan as well as the slashing of fee for the sanctioning of building plans of residential properties in Bengaluru from 0.5 per cent per square metre of the guidance value to 0.2 per cent.
Industry experts have welcomed the changes and have urged RERA to go beyond providing data on the number of registered projects and disposed cases.
Mr. Shankar states: "RERA’s efficiency has to be assessed based on projects meeting deadlines, the reduction in delays and the number of projects completed without any complaint."
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