The working principles of Real Estate Regulatory Authority (RERA), Karnataka

Working principles of Real Estate Regulatory Authority (RERA), Karnataka

Bengaluru is one of the top metropolitan cities in India and hence brimming with real estate market development opportunities. Bengaluru real estate is one of the most important destinations for developers across India. The responsibility to regulate and manage the affairs of this real estate market is on RERA Karnataka. RERA stands for ‘Real Estate Regulatory Authority. This authority was formed to execute the Real Estate Regulatory Authority Act 2016. The state government started following the Rera Karnataka Rules on July 5, 2017.

The main objective of RERA is to reform the real estate sector by bringing financial discipline, transparency, and accountability and protecting buyers from unlawful people. Under the rules of RERA Karnataka, every real estate promoter, the project, and the real estate agent has to be registered with Karnataka RERA before they can announce their project and involve the citizens. RERA Karnataka Fees & Charges are also fixed for registration under the RERA Act 2016. Currently, as per the RERA Karnataka official website, there are 5017 project registration, 2724 agent registration, and 5748 complaints registration.

Some important points under Karnataka RERA rules

Important points under Karnataka RERA rules
  1. Under the RERA act, Developers cannot ask for more than 10% of the property’s cost as an advance before the sale agreement is signed.
  2. A minimum of 70% of the amount realized for the real estate project by the investor and the buyer should be kept in a separate bank account within 15 days in a scheduled bank, and the same has to be used as construction cost.
  3. Builders have to submit all the original documents for their projects. Also, no changes can be made in the original plan without the buyer's consent.
  4. As per RERA Karnataka, the developers have to sell the property based on the carpet area and not on the built-up area.
  5. In the case of project delays, the buyers are entitled to get all their invested money, or they can get returns of the invested money from the developer.
  6. The builder is responsible for any issues related to the project up to five years after the purchase, and also the issues must be rectified within 30 days of the complaint.
  7. The developer cannot advertise, sell, or build without getting registered with RERA Karnataka. After the registration, the developer has to put the unique project-wise registration number provided by RERA Karnataka in all his advertisements.

The registration process for project registration in Karnataka RERA

Registration process for project registration in Karnataka RERA

Please follow the below steps for project registration in RERA Karnataka,

  1. Visit the RERA Karnataka Website
  2. Click on the ‘Project Registration’ tab and proceed
  3. Before actual registration, a popup window will appear. Please read all the documents before project registration.

Note: The registration process has to be completed within 30 days as per the RERA act

  1. Here is a list of the crucial information and documents required for project registration in RERA Karnataka:
  • The balance sheet of the past three years
  • Profit and loss statement after a thorough auditing
  • Cash transaction flow statement for the past three years
  • Income tax returns
  • Auditor’s report
  • Pan Card
  • Encumbrance Certificate
  • Commencement certificate
  • Approved building plan
  • Approved layout plan
  • Proforma of the agreement for sale.
  • Sale deed and RTC.
  • Approved section of the building.
  • Area development plan of the project area.
  • Proforma of allotment letter.
  • Brochure of the current project.
  • Project specification.
  • Joint development agreement.
  • Declaration (FORM B).
  • Khatha.
  • NOC as per 109 of KLR Act 1961.
  • CC (Conversion certificate) as per Section 95 of KLR Act 1961.
  • NOC as per KTCP Act.
  • Fire department NOC
  • Airport Authority of India NOC.
  • WSSB NOC.
  • BESCOM NOC.
  • KSPCB NOC.
  • BSNL NOC.
  • Existing layout plan.
  • SEIAA NOC.
  • Lift authority’s permission.
  • Change of land use.
  • Existing section plan and specification.
  • Urban land ceiling NOC.
  • BMRCL NOC.
  • Sectional drawing of the apartments.
  • Controller of explosives, Railways, inspector of Factories.
  • Bangalore Urban Arts Commission.
  • District magistrate.
  • Coastal Regulation Zone Authority.
  • Certificate of structural safety of the building from a registered engineer
  • NOC in the case of building proposals is overlapping to neighboring properties.
  • Advocate search report.
  • Utilisation certificate.
  • Transfer of development rights certificate.
  • Relinquishment deed.
  • Project photo.

Note: There are particular sizes with which all the above documents have to be uploaded.

  1. There are two types of project registration, Individual or society. Choose the appropriate one and then enter a valid email-ID
  2. The promoter detail page will be opened. Fill in all the applicable and mandatory details.
  3. Enter the project landowner details and previous project details if applicable.
  4. The project details fill in all information regarding ongoing status, development details, Project bank details, associated vendors, Architects, project contractors, and structural engineers. All '*' details are compulsory.
  5. On the upload document page, upload all the compulsory documents such as NOC’s, declarations, Project photos, etc.
  6. After completing the above steps successfully, a payment gateway will open. Click for online payment, and it will be directed to Treasury Unified gateway.
  7. Follow the payment steps and after successful payment, download the acknowledgment and note down the reference number.
  8. After this, complete the registration and generate the acknowledgment number.

List of Documents to be submitted to RERA Karnataka after project completion

As per Karnataka RERA, a new system has been introduced on Dec 23, 2020, which requires a developer to submit a self-declaration affidavit with the following documents.

  1. NOC from the Fire Services Department
  2. Consent of pollution control board for operation
  3. Escom's sanction letter for electrical connection
  4. BWSSB certificate for the treatment plant on the status of working
  5. Detailed information of external infrastructures such as garden, water, playing area, and driveway.
  6. Details of the transformers

The details furnished by the developer will be verified by the concerned on-site authority.

RERA Karnataka Charges & Fees for project registration

Group Housing projects

ParticularFees
Proposed land area for development is less than 1,000 square metersRs 5/sq. m
Proposed land area for development is more than 1,000 square metersRs 10/sq. m (max Rs 5 lakh)

Commercial Projects

ParticularFees
Proposed land area for development is less than 1,000 square metersRs 20/sq. m
Proposed land area for development is more than 1,000 square metersRs 25/sq. m (max Rs 10lakh)

Mixed Development (Commercial & Residential) Project

ParticularFees
Proposed land area for development is less than 1,000 square metersRs 10/sq. m
Proposed land area for development is more than 1,000 square metersRs 15/sq. m (max Rs 7 lakh)

Plot Development Projects

Rs 5/sq. m of the complete project area. The maximum fee is Rs 5 Lakhs

The registration process for Agent registration in Karnataka RERA

Similar to developer registration for projects, real estate agents operating in Karnataka also have to register his/her business with RERA Karnataka. It can also be registered as an entity. Follow the below steps for agent registration.

  1. Visit the RERA Karnataka Website
  2. Click on the ‘Agent Registration’ tab and proceed
  3. Select Agent type (Individual or company) and enter the Email-ID
  4. Fill in all Details of Applicants which are compulsory and applicable.
  5. Upload the documents and click on next.
  6. Check the preview of the filled details.
  7. After completing the above steps, the payment gateway page will be opened
  8. Make the payment through Treasury Unified Gateway
  9. On successful payment, a reference number will be generated. Note it down
  10. Complete the registration and generate the acknowledgment number

RERA Karnataka Fees & Charges for agent registration

ParticularFees
Individual AgentRs. 25,000
Business EntityRs. 2 lakh

Complaint filing on RERA Karnataka Website

Buyers and Investors can file a grievance against the developer or real estate agent on RERA Karnataka's official website by following the steps given below:

  • Visit the RERA Karnataka Website
  • Click on the ‘Complaint Registration’ tab and proceed
  • On the complaint login page, enter the login ID and password. If you are using it for the first time, click on a new user.
  • On the new user page, enter the name, phone number, and email ID and click on Register.
  • After the registration process is completed, credentials will be sent to the registered email ID.
  • Set a new password
  • After the login, a complaint register form will open. Fill in all the compulsory and applicable details and
  • In the respondent details, fill the 'complaint against,' 'project name,' 'promotor name,' 'complaint section,' and 'Nature of complaint.'
  • After filling the form, the user can preview the page and can take a print for reference.
  • A payment page will open for making online payment
  • RERA Karnataka will accept payment only through E-payment
  • After the payment is completed, a complaint number will be generated, and the user can track the status of the complaint using the same

RERA Karnataka Fees & Charges for complaint registration is Rs 1000.

Reporting of unregistered projects to RERA Karnataka

Buyers and investors can report unregistered projects to the RERA Karnataka official portal. Please follow the below steps to do so:

  1. Visit the RERA Karnataka Website
  2. Click on the ‘unregistered projects’
  3. Use the ‘report unregistered project’ option
  4. Fill in the form with details like 'Name of the Project,' 'Name of the Promoter,' 'Promoter Phone Number,'' Promoter Email Address,'' Project/Promoter Website,'' Project Address,' and 'Any Other Relevant Details.
  5. Upload related documents if available
  6. After a thorough investigation, the unregistered projects will be listed under 'Project under investigation.'
  7. The list is updated (addition or deletion) every Friday at 1 pm based on the Promoter's reply in response to notices issued by RERA.

The latest news on Karnataka RERA

  1. Karnataka RERA is drafting a proposal that will grant judicial powers to RERA to execute its orders. Once it is approved, RERA Karnataka will be able to solve Buyer -Builder disputes internally.
  2. Karnataka RERA is investigating developers of 512 delayed projects. RERA has informed that these developers have not applied for the extension as per the RERA rules. As per the rules, the developers have to declare the date of completion of the project while signing the agreement with the buyers. Also, they have to update project status every 3 months on the Karnataka RERA portal. A penalty of up to 10% of the project cost can be levied on the developers for non-compliance with the rules.

Conclusion

Karnataka RERA, A regulatory authority for Real estate across Karnataka, was much needed to control the real estate activities so that developers, real estate agents, and buyers all come under one umbrella. The RERA rules are made in such a way that the buyers or investors will feel safe and can be assured of getting their homes or apartments contracted within the promised time by the developer.

Also, Karnataka RERA provides a platform for solving buyer-developer disputes within the stipulated time. The chances of project completions are much higher than pre-Karnataka RERA formation. As everything is digitized and a dedicated portal is made available, there is going to be higher transparency and better tracking of the projects, thereby safeguarding the buyer from all the hassles.

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Frequently Asked Questions (FAQ's)

What will happen if a developer or an estate agent in violation of RERA Karnataka rules?

There will prison sentence of up to 1 year for real estate agents and 3 years for developers if they are found guilty of RERA Karnataka rules violation.

What is the minimum size of the plot for projects to be registered with RERA Karnataka?

As per RERA Act 2016, projects with a plot size of a minimum of 500 sq. m or a building of 8 apartments have to be registered with RERA Karnataka.

If a builder plans a project in multiple phases, is it okay to register the project once?

As per RERA Karnataka rules, each phase is considered a stand-alone project, and hence the builder has to register the project in each phase.

Can the project registration be revoked after the approval from RERA Karnataka?

If there are any violations in adhering to RERA rules or if there are complaints from buyers during the project and found guilty, then RERA Karnataka has the authority to revoke the project registration.