Smiley, Faceless & RERA Ltd: These Are Your new RERA registered Agent, Promoter and Projects
The Real Estate Regulatory Authority (RERA), set up to ensure safety and security of realty transactions by mandating that people only deal with registered and regulated entities, is already being manipulated.
The game-changing RERA legislation of 2016 has been adopted by 20 states, with Maharashtra and Haryana taking the lead in implementing it as a state-level legislation. However, in many other States, RERA is apparently treated as a joke.
Moneylife attempted a basic exercise to check how well the state RERA authorities are working. We started by calling helpline numbers available on the website to check if we could get useful answers (we called all 19 states everyday, over a span of three working days and received only seven responses the first day, and six responses the subsequent days).
We repeatedly got the stock canned message: “Dial kiya gaya number busy hai” (the number you have dialled is busy, please try after sometime). Either the real estate markets are booming and hence, the RERA offices are buzzing with activity or there is something very wrong. We also sent emails to all 19 states; only Andhra Pradesh RERA responded!
Here is a list of the helpline numbers and email IDs we tried to use to contact the respective State RERAs.
After a bit of sleuthing, we found several inconsistencies in websites of almost every state. We found issues with agents, promoters and projects in three specific state RERAs, which are not only illegal as per the Rules notified by the State, but are somehow allowed to be uploaded on this regulator’s registry.
It is mandatory for Projects, Promoters and Agents to be registered, however if no defaulters’ registry is maintained then it permits defaulters to re-register making the registration process redundant. Currently RERA does not verify the information provided about the project, promoters or agents at the time of registration. The consumer has to visit the state RERA website and file a complaint if false information has been furnished.
All state RERA websites are expected to maintain a defaulters list, which includes a list of rejected projects as well as promoters/agents who have failed to deliver on their commitment or have had action taken against them by the authorities. Most states have a defaulters list, however, as seen from the table below, they seem incomplete. Eight of the 20 RERA state websites do not even maintain a defaulters’ list.
State RERA websites, which maintain a defaulters list:
All Projects, Promoters and Agents need to be registered with the State RERA. This information needs to be available on State RERA websites in accordance with the rules determined by each state. A simple scrutiny of these registrations threw up some curious revelations.
Agents – Smiley and the red dot:
In one case, RERA Jharkhand allowed a Smiley instead of a photograph to be registered as a real estate agent.
There are several others like our friend on top, who have misused the RERA website for their own gain. We even spotted a puzzling red dot, which might indicate anything but the real estate agent’s actual face. In another case we found a stock photo from alamy.com uploaded in place of the agent’s photograph.
This information was also found on the RERA Jharkhand website alone.
RERA Jharkhand’s Rules prescribe that a photograph of the agent, along with a valid identity proof in the Form of a PAN Card be available on the website of the Authority. However, this has not been enforced.
With agents uploading emoji, stock photos and puzzling dots as their profile pictures, one has to wonder
What is going on?
This is not a problem with RERA Jharkhand alone. We discovered that RERA portals across the country have similar problems. Many states have not established a proper verification mechanism, especially for promoters of projects. This brings us to our second problem.
Promoters – Where are the promoter details?
Promoters are key to every real estate project and need to be compulsorily registered under RERA. They are responsible for development and constructions, conversion of existing buildings, plotting of land, commercial construction, colonizing, contractor development and estate development. They also need to release all details pertaining to the project, under Section 4(2) of the Act.
However, we have found several state RERA portals have not done this.
The state of Delhi, under an Aam Aadmi Party government is one of them. However, the Delhi RERA website was a big surprise. It has only 30 projects registered. Of these, false or inadequate information is displayed for 12 projects.
Section 14 (1)(a) of the Delhi RERA rules states that Promoter information such as, “name, address, contact details and photograph of the promoter in case of an individual and the name, address, contact details and photograph of the chairman, directors, partners, as the case maybe and that of the authorised persons” needs to be provided to the public. However, as we can see above, not all of this is provided, making the registration of the promoters’ very suspect.
Another State with a similar issue is Punjab. We discovered that 13 out of 705 promoter contact details have not been provided on the Punjab state website (as of 3rd June 2019). However, if a detailed verification is to be conducted, the number of suspicious registrations found will rise.
(Missing photo of promoter- marked in circle)
Section 15 of the Punjab RERA rules, clearly state that all promoters who are registering with Punjab RERA need to give details such as:
“name, address and contact details and photograph of the promoter in case of an individual and the name, address, contact details and photograph of the Chairman, Directors, Partners, as the case may be, and that of authorised persons.” However, in the picture above, we see literally nothing but a picture of the Land of Five Rivers.
Similarly, in Rajasthan the photographs of promoters, along with other details are not available.
Chapter 4 of Rajasthan RERA rules state “name, address, contact details and photograph of the promoter in case of an individual and the name, address, contact details and photograph of the chairman, directors, partners, as the case may be and that of authorised persons.”
We tried to verify the email IDs provided in the promoter’s registrations by using online email verification services, which may reasonably indicate the email IDs being provided are false.
Projects – Project or no Project?
A real estate project needs to register under RERA, if it is under construction, or if the project is to be commenced. It is registered under Section 3 of the RERA Act, 2016 and must comply with the State Rules that have been notified. This is indisputable before any court of law in India. However, in the process, we forget that it has to be done properly. The Delhi RERA brings us, an example of this, yet again.
Based on our dipstick analysis, we conclude that, there is a lot of work to be done in ensuring proper implementation of RERA in India. This Act, which was meant to provide some semblance of a sense of security to current and prospective homeowners has been misused by several states, and ignored by many others. Some states cite constitutional issues, while others have not even put up a website for grievance redressal despite notifying it in their state.
Until state governments resolve this issue), it will defeat the purpose of the Act, by giving no quarter to a citizen being robbed of their hard-earned money by a dubious agent or promoter. We will have to deal with the shady Smileys and Faceless to buy a house today.