The real estate bill was approved by the Rajya Sabha early this June 2013. This bill has been welcomed by the buyer community since many of its provisions seem to be in favour of the buyer. Let us see what changes the bill seeks to bring in:
On the positive side,
Currently, there is no specific delay clause for the builder if he fails to deliver his project as per the schedule. This will change due to this bill as strict measures will be taken against those builders whose projects see a long delay in completion.
Often times we see that the amenities promised by the builder do not see the light of the day or they have a completely different face as opposed to what was promised in the brochures. With the regulatory bill, such things will be a matter of the past as the builders are mandated to stick with the original project plan and any deviation will attract a penalty and/or even imprisonment.
The hitherto ambiguous carpet area to SBA ratio will assume clarity with this bill since the builder will have to declare the actual carpet area at the time of the launch of the project itself.
Due to the bill, the buyers will now be assured of all the clearances needed for the project as it is now mandatory to get all the clearances approved before the commencement of the project.
It is a common practice among builders to rotate funds received from one project to be invested in other projects that are simultaneously going on. This will however be put in check by the bill provision that mandates builders to maintain separate accounts for each project and transfer 70% of the funds collected into the account.
Any structural defect has to be brought to the notice of the builder within a year of the project’s completion to ensure its rectification without any extra charge.
On the flip side,
The bill has exempted any previous projects from its ambit, thereby putting the recent buyers in the last 2 years at a disadvantageous position.
Also, the smaller builders do not come under the regulation Act which makes the bill a non-exhaustive one.
With sanctions from the government being a delayed affair, residential projects all over could see a delay in being launched.
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