The Union Cabinet of ministers has cleared a Bill to set up a real estate regulator. The main provisions of the Bill relating to violations and grievance redress include:
1. Failure to comply with the norms for the first time would attract a penalty which may be up to 10% of the project cost and a repeat offence could land the developer in jail.
2. A developer putting out misleading advertisements can be jailed.
3. There will be Real Estate Appellate Tribunal that will hear appeals from orders, decisions or directions of regulator and adjudicating officer.
4. For fast tracking settlement of disputes, an adjudicating officer not below joint secretary in the state will be appointed by the authority.
5. Real estate regulator will have offices in every state. Commercial real estate has been kept out of purview of the proposed Bill. The Bill will apply to only residential buildings.
6. Developers will have to get their projects registered with the regulator before sale.
7. Developers can launch projects only after acquiring all statutory clearances from relevant authorities.
8. Developers cannot offer any pre-launch sales before obtaining all statutory clearances.
9. The statutory clearances are to be submitted to the regulator and also displayed on a website before starting the construction.
10. The developer will have to deposit up to 70% of funds received for a particular project in a separate bank account for the project.
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