Under the real estate bill, 50% to be deposit in 15 days

Under the real estate regulatory bill, promoters will be required to compulsorily deposit 50 percent of the amounts collected from consumers in a separate account in a scheduled bank with in a period of fifteen days to cover the cost of construction.

"This provision of 50 percent has been made after taking into account the cost of land needed to be acquired before announcing a project," the statement said. In the original bill, the provision was to keep 70 percent of amounts collected from customers in escrow account.

"Penal provisions under the proposed law include payment of 10 percent of project cost for non-registration and payment of another 10 percent of project cost or 3 year imprisonment or both if still not complied with," it added.

For wrong disclosure of information or for not complying with the disclosures and requirements, payment of 5 percent of project cost will be imposed.

The regulatory authorities would also have the power of cancellation of registration in case of persistent violations and decide on the further course of action regarding completion of such projects.

Under the proposed Law, one or more Regulatory Authorities will be set up in each State/UT or one Authority for two or more States/UT by the concerned governments for oversight of real estate transactions.

These regulators will co-ordinate efforts regarding development of the real estate sector and necessary advice to the appropriate government to ensure the growth and promotion of a transparent, efficient and competitive realty sector. For fast track dispute settlement, one or more adjudicating officers will be appointed to settle disputes and impose compensation and interest.

Appeals against adjudicating officer and regulatory authority will lie with the Appellate Tribunals to be set up and final appeals will lie only with High Courts.

The proposed law is expected to give a boost to the 'Housing for All by 2022' mission by enabling increased flow of investments through enhanced transparency, accountability and standardization.

When contacted, realtors' apex body CREDAI President Getamber Anand said: "As an industry body we have always welcomed the real estate regulators." He also hailed the government's move to include the commercial segment in the bill.

However, Anand expressed concern over the decision to bring all the ongoing projects under the ambit of this proposed law and said the provisions should be prospective and not retrospective.

"We have not seen the fine print of the amendments in the bill. We hope that all the issues we had raised have been addressed," Anand said.

CREDAI had demanded that all the sanctioning authorities of the real estate projects should be answerable to the regulator. It had also sought clarity on the clauses related to penalty for wilful default by developers, among others.

"If the bill in its final form addresses these issues, then this will help real estate sector grow," Anand said.