As per the notification published by the Karnataka government on 10th July 2017, its clear that only current projects where all development works have been completed as per the Act and certified by the competent agency are exempted from RERA. The buyers of the homes may now stand to benefit from the provisions of the Real Estate (Regulation & Development) Act. This act has brought a huge number of ongoing projects under the purview of the law.
The government had been under criticism for the draft rules published last week which mentioned that ongoing projects, where 60% development work had been completed or 60% of the apartments or houses or plots had been registered and executed, would not come under the purview of the Act.
Many buyers felt that they had been let down by the government. Therefore, some of these buyers planned to challenge the cabinet decision on the grounds that it is against the spirit of the federal law. The buyers who had been left miserable include the beneficiaries of the Kempe Gowda layout and Arkavathy layout developed by Bangalore Development Authority (BDA). Buyers who had challenged exclusion of RERA in Karnataka fell that there were no clear guidelines to determine the stage of completion of a project and developers can take advantage and manipulate this rule. Buyers felt that the provision gave a benefit to the developers to slip out and there was also lot of confusion as to how a consensus could be reached on such an arbitrary number.
However, that part seems to have been addressed. As per the notification which got published on Monday it is official that only ongoing projects where all development works have been completed as per the Act and certified by the competent agency are exempted from RERA. And hence, the 60% salelease deed provision stays.
When some of the developers we’re asked to comment on this new rules by the government, they stated that they were not expecting. The developers felt that though the law is customer friendly , any retrospective law is bad and goes against natural justice. Most of the ongoing projects, where the developers have not applied for an occupancy certificate, will come under RERA.
According to the new law, a builder can apply for an OC only if it has been certified by a competent agency -in this case by an architect. So if the OC has already been applied for, that building is exempted from RERA regulations. Some find these rules very strict because builders will now have to get in place the waterlines, electricity lines and other things before applying for OC. However, these rules are not much of a dilution from the central legislation and they are almost in line with the Act as far as its application to ongoing projects is concerned. If a project comes under RERA, buyers would be in a position to file a complaint in case there is a delay or if the building has not gone by the approved plans.