OTHERS Quick Review on RERA

Quick Review on RERA

Who is a Real Estate Agent?

Section 2 (zm) of RERA defines real estate agents. According to the definition, a “real estate agent” means any person, who negotiates or represents other persons for transfer of a real estate property by way of sale to another person and receives remuneration or fees or any other charges for his services whether as commission. A real estate agent is also a person who introduces, through any medium, prospective buyers and sellers to each other for negotiation for sale or purchase of real estate property, as the case may be, and includes property dealers, brokers, middlemen etc.

Brokers are mandated to show the facilities, aspects and amenities of the building project they are marketing and not to add anything additional or hide crucial information to confuse or mislead the buyer. Any deviation or default will attract penalty under RERA Act, including cancellation of the license.

Requirement of registration:

To achieve the objective of regulating the real estate sector and to standardize this sector making it more transparent, the Act and the Rules made thereunder require for the real estate agents to obtain a registration certificate from the Real Estate Regulating Authority. RERA also says that the real estate agents will also be liable for any flaws in the project and can be prosecuted for any misconduct in the business. It is Section 9 (1) of RERA that mandates the registration. Section 9 prohibits an agent to operate his business without such registration.

Obligation

  • The registration certificate should be displayed at the place of business.
  • All advertisements, marketing, selling or purchase papers, should have the registration number.

Procedure for registration:

Rule 8 of the National Capital Territory of Delhi Real Estate (Regulation and Development) (General) Rules, 2016 (“Rules”) read with Section 9 (2) of RERA state that every real estate agent, required to register, shall make an application in writing to the Authority established under RERA Form ‘G’, in triplicate, until the application procedure is made web based.

Documents Required for RERA Registration

Application for RERA registration should be accompanied by the following documents:

  • Name, registered address, type of enterprise (proprietorship, societies, partnership, company etc.);
  • In case of a Real Estate Agency the particulars of incorporation including the bye-laws, MoA , AoA,
  • Name, Address, contact details and photograph of the real estate agent or director or Partners
  • Last three years Income tax Return and if no IT returns are available, a declaration must be furnished.
  • Past experience in this field of business. A declaration for this should be furnished.
  • PAN & Aadhar cards
  • Photo
  • Address of place of business and
  • Blank receipt (sample) for the commission that will be billed.

Fee for RERA Registration

The fee for RERA registration varies from State to State. The following is the RERA registration fee for Maharashtra:

Registration fees for RERA

  • Rs 500 to Mahaonline for Maha-Rera website (plus taxes and bank charges, if any).
  • Rs 10,000 for individual, proprietor, or proprietorship firm.
  • Rs 1,00,000 for partnership firm, society, private Ltd/Ltd company, LLP, etc.

Once the above application and fee is submitted, the authorities will issue RERA registration certificate within 30 days of application. The RERA registration certificate should be displayed at the place of business. All promotional materials such as advertisements and brochures of the broker must mention the RERA registration number.

Book of records

  • The agent shall maintain book of accounts, records and documents, separately for each real estate project.

Registration time frame

  • The authorities shall deliver the registration number, along with the certificate, within 30 days from the date of registration.

Validity of registration/renewal

  • Valid for five years. Renewal to be done at least 60 days prior to the expiry of the registration.

Penalty on unregistered brokers involved in registered projects

  • Rs 10,000 per day during the period of failure and a maximum of up to 5 per cent of the value of the deal or project value.

Validity of RERA Registration : RERA registration for Brokers will be valid for 5 years from date of issue. The license can be renewed again for a period of 5 years, by submitting a renewal application 60 days prior to the expiry date.

Conditions for RC:

The following conditions/ compliances are to be adhered to by the real estate agents after attaining the registration certificate:

  • Not to facilitate sale of unregistered property;
  • Due maintenance of books of accounts records and documents as provided under rule 14;
  • Avoid use of any unfair trade practices as enumerated under the rules assistance to enable the allottee and promoter to exercise their respective rights and fulfil their respective  obligations at the time of booking and sale of any plot, apartment or building, as the case may be; and
  • Generally adhere by the provisions of the Act and the Rules.

These conditions are also mentioned as conditions in the registration certificate as well as Section 10 of RERA.

Deemed registration:

According to Section 9 (4) of the Act read with Rule 9 of the Rules, if the Authority does not grant or reject the registration certificate within 30 days, hereon the completion of the period specified under sub-section (3), if the applicant does not receive any communication about the deficiencies in his application or the rejection of his application, he shall be deemed to have been registered.

Why Required

Real estate agents are the heart of real estate industry . They are the mediators facilitating transactions between builder and buyer . With RERA, that will soon come into force, all brokers will have to be mandatorily registered with the concerned state-level regulatory authorities. Real estate agents will be given a registration number by the authority which will be valid for 5 years and will be quoted in every transaction facilitated by him.

To stimulate fair practice of doing business in the real estate sector, RERA mandates intermediaries (including intermediary websites) to get themselves registered and retain a valid RERA registration number before facilitating any real estate deal on the behalf of any real estate developer. The intermediary is also required to maintain and preserve account logs and other documents as prescribed by the Act. Also, he/she must facilitate all information and provide any further assistance as prescribed by the Act to the consumer.

If the intermediary fails to comply with the duties and responsibilities prescribed by the RERA, his/her registration can be revoked.

Further, he/she can be penalized up to Rs 10,000 per day, which may extend up to 5% of the total estimated cost of the unit in question. The intermediary can also face imprisonment up to one year if he/she breaches any orders given by the Appellate Tribunal.

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