A RERA expert lawyer can provide valuable insights into the Real Estate (Regulation and Development) Act, 2016 (RERA), which was enacted to enhance transparency, accountability, and efficiency in the real estate sector across India. The RERA Act is a Central Legislation to reign over the real estate sector and it mandated the respective State Governments to enact and establish authorities such as HRERA, UP-RERA, etc. Further, it mandated them to make their Rules & Regulations for governing the functioning of the relevant RERA Authority. Haryana RERA (HRERA) is a regulatory authority established under the RERA Act for promoting and regulating real estate in Haryana and its jurisdiction is divided between two authorities of Panchkula and Gurugram.
Understanding builder obligations under HRERA is crucial for ensuring compliance and avoiding legal penalties. Builders must be well-versed with the specific requirements set forth by HRERA rules and regulations, including registration processes, maintaining escrow accounts, adhering to construction norms and following advertising regulations. By consulting a RERA expert lawyer, builders can ensure compliance with these rules and avoid potential legal risks.
Registration Requirements for Builders under HRERA
Under the Haryana Real Estate Regulatory Authority (HRERA), it is mandatory for builders to register their projects before any advertising, marketing, or selling activities can commence. This registration process is crucial to ensure transparency and accountability in the Haryana real estate market, and consulting with an RERA expert lawyer can help builders navigate these requirements more effectively.
Steps for Project Registration:
- Visit the HRERA Website: Builders must begin by visiting the Haryana RERA website and accessing the project registration section.
- Create an Account: They need to sign up to create an account, providing basic details such as the promoter’s name, contact information, and project details.
- Fill Form REP-1: The registration involves filling out Form REP-1. This form requires comprehensive details about the project, including land ownership documents, approved building plans, environmental clearances and financial statements. A RERA expert lawyer can assist in ensuring that all legal documents are in order for smooth processing.
Documentation Requirements:
- Land Ownership Documents: Builders must provide proof of land ownership or development rights.
- Approved Plans: Submission of approved building and layout plans is mandatory.
- Financial Statements: Audited financial statements of the promoter for the last three years are required to ensure financial stability.
- Escrow Account Details: Builders need to provide details of the escrow account where funds collected from homebuyers will be deposited to ensure they are used solely for the project.
Fee Submission:
- Builders must pay the required registration fee via bank draft or online payment. The fee structure varies based on the size and type of the project. To ensure compliance with HRERA’s regulations, it is advisable for builders to consult an RERA expert lawyer for guidance on fee submission and overall registration processes.
Financial Obligations and Transparency Under HRERA
One of the critical aspects of compliance under the Haryana Real Estate Regulatory Authority (HRERA) is the financial transparency that builders must maintain throughout the lifecycle of their projects. This requirement is designed to protect the interests of homebuyers and ensure that their investments are used responsibly. Consulting a RERA expert lawyer can help builders understand these obligations and ensure compliance with the financial regulations laid out by HRERA.
Escrow Account Requirements
Builders are mandated to maintain an escrow account for each project they undertake. This account serves as a financial safeguard, ensuring that the funds collected from homebuyers are utilized solely for the project’s development. According to HRERA regulations, builders must deposit 70% of the total funds received from buyers into this escrow account. A RERA expert lawyer can guide builders on how to properly manage these accounts and ensure compliance with all financial obligations. This measure prevents the diversion of funds to other projects or personal use, thereby protecting the interests of homebuyers and promoting transparency in the Haryana real estate sector.
Financial Audits and Documentation
Builders are required to conduct regular financial audits of their projects. These audits must be carried out by a qualified chartered accountant and submitted to HRERA at specified intervals. The audits ensure that the funds in the escrow account are being utilized appropriately and provide a clear financial trail for regulatory scrutiny.
Compliance with Construction and Development Norms
Ensuring compliance with construction and development norms is a fundamental obligation for builders under the Haryana Real Estate Regulatory Authority (HRERA). These norms are designed to maintain the quality, safety, and timeliness of real estate projects. To avoid any legal complications, builders often seek the guidance of a RERA expert lawyer to navigate the complex regulatory requirements.
Obtaining Necessary Approvals: Builders must secure all requisite approvals and clearances before commencing construction. This includes:
- Building Plan Approval: Builders are required to obtain approval for their building plans from the local municipal authorities. These plans must adhere to the zoning regulations and building codes set forth by the government. A RERA expert lawyer can help ensure that the approvals meet HRERA standards.
- Environmental Clearance: For larger projects, obtaining an environmental clearance from the appropriate authority is mandatory. This ensures that the project does not adversely impact the environment. Further, NOC from Fire Safety Department, NOC from Airport Authority of India, etc. are to be obtained before starting the construction. Consulting with an RERA expert lawyer can facilitate the timely acquisition of these clearances.
- Commencement Certificate: Before starting construction, builders must secure a commencement certificate from the local development authority, confirming that all necessary approvals have been obtained.
Adhering to Project Timelines: HRERA mandates that builders to adhere to the specified timelines for project completion. Any delays must be justified, and the reasons for the delays should be documented and submitted to HRERA. Builders are legally obligated to complete the project within the stipulated time frame as mentioned in the agreement with the homebuyers.
Advertising and Marketing Regulations Under HRERA
Under the Haryana Real Estate Regulatory Authority (HRERA), builders must adhere to stringent advertising and marketing regulations to ensure transparency and protect homebuyers from misleading information. These regulations are critical in maintaining trust and fairness in the Haryana real estate market. Here are the key aspects of these regulations and their legal implications.
Truthful Advertising: Builders are required to provide accurate and truthful information in all their advertisements. According to HRERA guidelines, any promotional material must include the RERA registration number of the project. This ensures that potential buyers are aware that the project is registered and compliant with H-RERA regulations.
Prohibited Practices:
- Misleading Advertisements: Builders are prohibited from making false claims or providing misleading information about the project. This includes exaggerating the amenities, project status or location advantages. Any such practice can lead to severe penalties under H-RERA.
- Unregistered Projects: Advertising unregistered projects is strictly forbidden. Section 3 of the RERA Act states that no promoter shall advertise or sell a project without registration. Violating this provision can result in significant fines and legal action.
Dispute Resolution Mechanisms Under HRERA
Dispute resolution is a critical aspect of the Haryana Real Estate Regulatory Authority (HRERA), designed to address grievances between homebuyers and builders effectively. The mechanisms put in place by HRERA ensure that disputes are resolved promptly, thereby maintaining trust and transparency in the Haryana real estate market. Here are the key components of the dispute resolution process under HRERA.
Filing Complaints: Homebuyers and builders can file complaints with HRERA if they encounter any issues related to project delays, non-compliance or breach of contractual terms, non-delivery of possession as per the contract terms or other grievances. The complaint process is straightforward:
- Online Complaint Registration: Complainants can file their grievances online through the HRERA website. The portal provides a user-friendly interface for submitting complaints, tracking their status, and receiving updates.
- Required Documentation: Complainants must provide necessary documentation, such as agreements, payment receipts, and correspondence with the builder, to support their claims.
Adjudication Process: Once a complaint is filed, HRERA initiates an adjudication process to resolve the dispute:
- Hearing and Investigation: The authority conducts hearings where both parties present their cases. HRERA may also carry out investigations to gather additional information and verify the claims.
- Timely Resolution: HRERA aims to resolve disputes within 120 days of filing the complaint. This prompt resolution process is designed to provide quick relief to homebuyers and ensure that builders address grievances efficiently.
Appeals and Redressal: If a party is aggrieved with the judgment passed by the HRERA, they can appeal to the Haryana Real Estate Appellate Tribunal (HREAT), Panchkula. The Appellate Tribunal reviews the case and provides a final verdict. This multi-tiered approach ensures that disputes are thoroughly examined and justly resolved.
Role of RERA Expert Lawyer and RERA Advocate: Engaging a RERA expert lawyer or RERA advocate can significantly enhance the dispute resolution process.
- Legal Representation: Provide representation during hearings and ensure that the complainant’s interests are effectively advocated.
- Documentation and Evidence: Assist in gathering and presenting the necessary documentation and evidence to support the case.
- Navigating Legal Procedures: Guide clients through the legal procedures, from filing complaints to appealing decisions, ensuring compliance with HRERA regulations.
Conclusion
Understanding and adhering to the obligations set forth by the Haryana Real Estate Regulatory Authority (HRERA) is essential for builders to ensure transparency, accountability, and compliance in the Haryana Real Estate market. By following proper registration procedures, maintaining financial transparency through escrow accounts, adhering to construction norms and ensuring truthful advertising, builders can avoid significant penalties and legal repercussions. The guidance of a RERA expert lawyer or RERA advocate is invaluable in navigating these regulations, protecting both builder’s and homebuyer’s interests.
Leverage MAHESHWARI & CO.’s Expertise in Navigating HRERA Compliance
Navigating the complex landscape of HRERA regulations can be challenging for builders and homebuyers alike. MAHESHWARI & CO. offers unparalleled expertise in real estate law, ensuring compliance with all legal requirements under HRERA. Whether you need assistance with project registration, financial audits, dispute resolution or any other legal obligation, our team of seasoned RERA expert lawyers is here to guide you every step of the way.
FAQs
1. What are the main responsibilities of builders under HRERA?
Builders are required to register their projects with the Haryana Real Estate Regulatory Authority (HRERA) before advertising or selling any property. They must maintain an escrow account to ensure financial transparency, adhere to approved building plans, and obtain necessary clearances such as environmental approvals. Regular financial audits and timely project completion are also mandated to protect homebuyer interests. Consulting a RERA expert lawyer can help builders navigate these obligations effectively.
2. How does HRERA ensure the financial transparency of real estate projects?
HRERA mandates that builders maintain an escrow account for each project, where 70% of the funds collected from homebuyers must be deposited. These funds can only be used for the specific project, ensuring they are not diverted elsewhere. Builders must also conduct regular financial audits and submit detailed financial statements to HRERA.
3. What penalties can builders face for non-compliance with HRERA regulations?
Non-compliance with HRERA regulations can result in hefty penalties, including fines up to 10% of the project’s estimated cost for non-registration. Misleading advertisements can attract fines up to 5% of the project cost. Continued violations may lead to further penalties or imprisonment. Timely compliance with HRERA is crucial to avoid these severe consequences.
4. How can homebuyers file a complaint under HRERA, and what is the process?
Homebuyers can file complaints through the Haryana RERA website by submitting necessary documents and detailing their grievances. HRERA conducts hearings and investigations to resolve disputes, aiming to provide resolutions within 120 days. If dissatisfied with the decision, parties can appeal to the Real Estate Appellate Tribunal. Engaging a RERA expert lawyer can help in effectively navigating the complaint process.
5. What are the benefits of consulting a RERA expert lawyer for builders and homebuyers?
Consulting an RERA expert lawyer offers numerous benefits, including legal guidance on compliance with H-RERA regulations, assistance with documentation and registration, representation in disputes, and advice on financial and advertising practices. For homebuyers, a RERA advocate can help in filing complaints and ensuring their interests are protected.
