The domain of the RERA authority extends even to the projects which have not been registered, and also not exempted from registration. No promoter shall advertise, market, book, sell or offer for sale, or invite persons to purchase in any manner any plot, apartment or building, as the case may be, in any real estate project or part of it, in any planning area, without registering the real estate project with the Real Estate Regulatory Authority established under this Act. In case of violation, the Regulatory Authority may take action for non-registration under Section 59. Accordingly, the projects which have not been registered, but are registrable in case of violation of Section 3 comes within the domain of the authority and authority is well within its power to initiate penal proceedings and also to entertain complaints regarding violation of the provisions of the Act. The Regulatory Authority cannot take a stand that the project is unregistered and accordingly it has no jurisdiction to entertain the complaint. Where will the complainant go? The complainant may make a complaint to the Regulatory Authority regarding non-registration of the project as well as may request the Regulatory Authority for compliance of obligations by the promoter in case the promoter violates any of the provisions of the Act, the rules and the regulations made thereunder. The Regulatory Authority in such a case cannot take a stand that let the project be got registered and only thereafter it will entertain the complaint. If a complaint in such cases is not entertained by the Regulatory Authority, a scrupulous promoter or builder or developer may not register the project to avoid the jurisdiction of the Regulatory Authority. This will frustrate the very purpose of the Act regarding giving relief to the complainant and ensuring compliance with the obligations by the promoters, real estate agents and allottees.
The Act provides for obligations of the promoter, real estate agent and allottees both during the registration phase as well as post-expiry of validity of registration i.e. after the completion of the project. The obligations post-expiry of the validity of registration are to be ensured by the authority both in case of projects which were registered, and validity of registration expired as well as for the projects where completion certificate was obtained prior to coming into force of this Act and exempted from prior registration. The obligations of the promoter after completion of the project such as handing over of possession and executing a registered conveyance deed within a specified period, workmanship and structural defects rectification liability upto five years after giving possession, land title defect liability without any limitation period etc. are applicable for all the real estate projects, both registered as well as exempted from prior registration.
Further, in case of a project where a completion certificate has been obtained for a real estate project but there is unsold inventory left out then it is true that there won’t be any requirement of prior registration of the project as the project has already been completed prior to coming into force of this Act.
The registration of projects serves mainly three purposes.
- to monitor the progress of the project so that the project is completed timely;
- to ensure that the amount collected from the buyers is not diverted to any other purpose; and also
- to see that layout plan, building plan, specifications etc. as approved by the competent authority are followed by the promoter. The requirement of registration is to monitor the project from commencement to completion. The validity of registration expires on issuing of completion certificate or on expiry of period for completion of project declared by promoter under section 4(2)(l)(c), keeping in view the provisions of section 5(3).
There are certain obligations of the promoters which are to be complied by them. Some of these obligations are during registration phase and some of the obligations are post expiry of the validity of registration. Accordingly, there are a large number of obligations of the promoter which are not linked with the completion of the project, but those provisions relate to regulating the relationship between promoter and allottee such as conveyance deed, giving possession, workmanship and structural defect rectification liability, defective land title liability, etc. The projects which have been issued completion certificate prior to commencement of the Act have been taken out of prior registration requirement, but not out of the ambit of the Act. The unsold inventory of such projects sold after commencement of this Act falls within the purview of this Act as these projects have not been kept out of the ambit of the Act, 2016.
After the commencement of Act, 2016, the buyers of the real estate, out of unsold inventory where the promoter has obtained completion certificate prior to commencement of the Act, cannot be left in a lurch in case possession is not handed over or conveyance deed is not made as per the agreement for sale, defective land title, structural defect and workmanship defects, etc. Whenever sale of real estate takes place after the commencement of Act of 2016 and a project qualifies to be a real estate project as per the definition given in the Act and the promoter is covered in the definition of promoter as given in the Act, then a complaint in respect of matters where this Act casts certain obligations upon the promoter can be made to the Regulatory Authority. There cannot be two different authorities to be approached for similar types of complaints. The registration certificate of real estate project is valid from the date of registration and it expires as soon as the project is completed, and the completion certificate is issued i.e. the time period declared by the promoter in accordance with section 4(2) (??) (C) for completion of the project. Hence, even after the expiry of the validity of the registration, there are large number of obligations that are to be discharged by the promoter. Hence, in respect of those obligations complaints of projects registered or exempted irrespective of the fact whether the sale has taken place before the commencement of the Act or after commencement of the Act can be made to the Regulatory Authority and such projects are squarely covered in the ambit of the Real Estate Regulatory Authority. In nutshell, this Act primarily protects the interest of the consumers in case of sale of real estate.
There will be three categories of real estate projects which can be sold by a promoter:
- Real estate projects where completion certificate of the project has been obtained prior to commencement of the RERA Act, 2016 but there is unsold inventory of real estate project.
- The real estate projects which are “on-going” and where the completion certificate has not been issued on the date of commencement of the RERA Act, 2016. So, these are to be registered as real estate projects with the Regulatory Authority.
- New real estate projects to be taken up after commencement of this Act : Here, there can be two types of real estate projects which can be put to sale by the promoter. (a) where the promoter intends to market/sell real estate project only after obtaining completion certificate; (b) where promoter intends to advertise, market or sell real estate during construction phase i.e. prior to obtaining completion certificate.
All these projects come within the ambit of the Real Estate Regulatory Authority. A complaint pertaining to violation of any of the provisions of the Real Estate (Regulation and Development) Act, 2016, the Uttar Pradesh Real Estate (Regulation and Development) Rules, 2016 and regulations there under, may be filed by any aggrieved person in respect of real estate belonging to any real estate project which qualifies to be real estate project as per the definition given in section 2(z)(n) of the Real Estate (Regulation and Development) Act, 2016.
In sub-section 3 (2) (b) it has been mentioned that those projects where the promoter has received the completion certificate for real estate project prior to commencement of the Act, 2016 have been taken out of the ambit of registration and not the real estate projects which may have received the completion certificate after the commencement of this Act. Section 3(2) exempts certain categories of real estate projects only from prior registration-related provisions but not from the ambit of other provisions of the Act, 2016.
From the plain reading of section 3, it is evident that the projects for which the completion certificate has been issued prior to commencement of this Act have only been exempted from prior registration, if the proviso to section 3(1) is read with section 3(2)(b). Section 3(2) provides for categories of projects where no prior registration shall be required. This section 3(2)(b) specifically provides that no prior registration of the real estate project shall be required where the promoter has received completion certificate for a real estate project prior to commencement of this Act, i.e. prior to 01.05.2017.
There is no need to re-define ongoing project, since all projects where completion certificate has not been issued are ongoing projects and completion certificate issued by the competent authority on or before 30.04.2017 is the conclusive proof of the fact that the project is complete, and it is not “on-going”.
On the basis of aforesaid analysis, we are of the considered view that Act, 2016 mentions nowhere that it is applicable only for registered projects. The Act, 2016 does not provide certain categories of projects that are not required to be registered but these are well within the ambit of the Act. These projects mentioned in Section 3(2) have been taken out of the prior registration requirement, but not out of purview of other provisions of the Act. The provisions regarding registration and obligation during registration are applicable only for the registered projects.
Above extracts are from the case: Lucknow Development Authority v. Uma Shankar Dubey, 2020 SCC OnLine RERA (UP) 10
Your detailed information on rera is really very helpful!!
plz made pdf of this judgemet available.
Can you please send me a copy of the judgement of the UP rera appealate tribunal referred above on the applicability of the rera act and occupancy certificate
Dear Mr. Kanha,
As per your article “ RERA is applicable to all real estate projects, even if a completion certificate is issued to the project.”(which is a judgement given by UP RERA Appellate tribunal), understand that RERA is applicable for projects for which Completion Cert. has been issued but the promoter has unsold “inventory(i.e, Flats) left in that project,.
However, The Supreme Court ruling says that :RERA Act does not apply to the projects already completed or to which the completion certificate has been granted at the commencement of the Act.(Ref:https://taxguru.in/corporate-law/applicability-rera-act-retrospective-retroactive.html).
In our housing society, the completion certificate was issued in 2010.
The corporation approved plan(based on which Completion certificate was issues by Corporation in 2010) shows a number of open & slit car parking which were not sold by the promoter till 2019). Promoter has sold some of these car parkings in the year 2020 & wishes to sell the other afore mentioned left over parkings).
(1.) A school of thought understands that, as per RERA(clause no.16.a), the parking spaces of our complex ( which were not sold/allotted to the residents before issuance of completion certificate in 2010) can not be sold independently(even to the residents) in the year 2020 due to retroactive feature of the RERA(which came into effect in 2016).
But there is another school of thought who are of the opinion that in line to Supreme Court ruling, RERA will not be applicable for the project completed in 2012 & therefore promoter can sell his leftover parking spaces to the residents in 2020.
Look forward to your kind clarification on this.
(2.) Will RERA be applicable for this project which received completion certificate in 2010 but now in 2020 promoter returned & started selling the parking spaces ( both open & stilt parking(i.e ground floor of the buildings without walls on three sides)?
Look forward to your kind clarification.
Can you please send me a copy of the judgement of the rera appealate tribunal of UP