What RERA Actually Gives a Buyer, Section by Section

Every developer's blog will tell you that the Real Estate (Regulation and Development) Act, 2016 protects buyers. Almost none of them will tell you which provision to point at when something goes wrong, which is the only part that is any use to you. A protection you cannot cite is a mood, not a remedy.

So this is a map rather than a summary. Eight sections, what each one actually does, and what it is good for on the day you need it. Where the Act leaves something to the States — an interest rate, a form, a fee — that is said plainly rather than filled in, because those are set by the rules made under the Act and not by the Act itself.

Section 3: nothing may be advertised or sold before registration

Section 3(1) is the hinge the whole statute swings on. No promoter may advertise, market, book, sell or offer for sale — or invite persons to purchase in any manner — any plot, apartment or building in a real estate project, or any part of it, in a planning area, without first registering the project with the Real Estate Regulatory Authority for that State.

Read the verbs. Advertise and market sit alongside sell. The bar is not on taking money; it is on the marketing that precedes taking money. A hoarding, a microsite, a brochure or a soft-launch WhatsApp forward for an unregistered project is the contravention, whether or not a rupee has changed hands.

Section 3(2) carves out the exceptions: land not exceeding five hundred square metres or not more than eight apartments inclusive of all phases, a project whose completion certificate predates the Act's commencement, and renovation or repair or re-development that involves no marketing, advertising, selling or new allotment. The appropriate Government may lower the first threshold.

What section 3 is good for: it converts "is this project genuine?" into a question with a documentary answer. Either there is a registration number and a register entry, or the project may not lawfully have been shown to you at all.

Section 4: what the promoter had to declare to get registered

Section 4 is the application, and it is the reason a registered project is a disclosed project. The promoter files, among other things, authenticated copies of the legal title deed and of any encumbrance details, the sanctioned plan and layout plan with the specifications approved by the competent authority, a plan of development works and proposed facilities, the proforma of the allotment letter, the agreement for sale and the conveyance deed, the number and area of the apartments and garages, the names and addresses of the contractors, architect and structural engineer, and the audited balance sheet of the preceding financial year.

Then section 4(2)(l) requires a set of signed declarations. Sub-clause (A) is legal title to the land. (B) is that the land is free of encumbrances, or the particulars of them. (C) is the time period within which the promoter undertakes to complete the project — the date the rest of the Act measures delay against. (D) is the separate-account rule that everyone calls the escrow rule.

What section 4 is good for: it tells you what exists. You do not have to negotiate for the sanctioned plan; a version of it was filed to obtain the registration you are looking at.

Section 11: what has to stay published, and stay current

Section 11(1) puts the promoter's project on the authority's own website, on a web page created against the login the authority issues, with the details entered and then updated quarterly — the number and type of apartments booked, the status of the project, and the status of the approvals still to come.

Section 11(2) is the one you can check from an advertisement: a prospectus or advertisement must prominently mention the website address of the authority where the project's details have been entered, and must carry the registration number.

Section 11(3) requires that, at the time of booking and issue of the allotment letter, the promoter make available the sanctioned plans and layout plans along with the stage-wise time schedule of completion, including provisions for civic infrastructure. Section 11(4) keeps the promoter responsible for its obligations until the conveyance of all the apartments and the common areas to the association of allottees, requires it to obtain the completion or occupancy certificate, to provide essential services until maintenance is taken over, and to enable formation of the association of allottees.

What section 11 is good for: a stale register page is itself a fact about a developer. The quarterly update is not optional and its absence is visible to anyone.

Section 12: the advertisement is part of the deal

Section 12 deals with the veracity of the advertisement or prospectus. Where a person makes an advance or a deposit on the basis of information in a notice, advertisement or prospectus, or on the basis of a model apartment or plot, and sustains a loss because of an incorrect or false statement in it, that person is entitled to be compensated. If the person elects to withdraw from the project, the entire investment is returned with interest at the prescribed rate, along with the compensation.

This is the section that makes a brochure figure consequential. An area, a specification, an amenity or an approval status printed to induce a booking is not marketing puff once section 12 is in the picture.

What section 12 is good for: it is the reason to keep the brochure, the price sheet and the screenshots. The claim you cannot produce is the claim you cannot invoke.

Section 13: no serious money before a registered agreement

Section 13(1) bars a promoter from accepting more than ten per cent of the cost of the apartment, plot or building as an advance payment or application fee from a person, without first entering into a written agreement for sale with that person and registering that agreement under the law in force.

Section 13(2) then says the agreement must be in the form prescribed by the State rules, and must specify the particulars of development of the project, the specifications and the internal and external development works, the dates and manner of payment, the date on which possession is to be handed over, and the rates of interest payable by the promoter to the allottee and by the allottee to the promoter on default.

What section 13 is good for: it fixes the sequence of a compliant purchase. Agreement first, then money beyond the ten per cent — and the agreement carries a possession date and a symmetrical default rate, both of which a booking form usually does not.

Section 14: the plan you were shown, and the five years after handover

Section 14(1) requires the development to proceed in accordance with the sanctioned plans, layout plans and specifications as approved by the competent authorities. Section 14(2) then splits alterations in two. Anything inside your own apartment — the sanctioned plan, the specifications, the nature of the fixtures, fittings and amenities described for it — needs your previous consent. Anything in the buildings or the common areas needs the previous written consent of at least two-thirds of the allottees other than the promoter. Minor additions or alterations recommended by the architect or engineer on account of site conditions are treated separately.

Section 14(3) is the defect liability period. A structural defect, or a defect in workmanship, quality or provision of services, or any other obligation under the agreement for sale, brought to the promoter's notice within five years of handover, must be rectified without further charge within thirty days — and failing that, the allottee is entitled to compensation.

What section 14 is good for: it survives possession. Most of the Act is about getting the home; this part is about the five years after you have it.

Section 18: what a delay actually entitles you to

Section 18(1) applies where the promoter fails to complete or is unable to give possession in accordance with the terms of the agreement for sale, or by the date specified in it, or is unable to do so because its registration has been suspended or revoked or for any other reason. The allottee then has a choice.

• Withdraw. The promoter must return the amount received in respect of that apartment, with interest at the prescribed rate, including compensation in the manner provided by the Act.
• Stay in. Under the proviso to section 18(1), an allottee who does not intend to withdraw is paid interest by the promoter for every month of delay, until possession is handed over, at the prescribed rate.

Section 18(2) covers loss caused by a defective title to the land, and section 18(3) makes the promoter liable to compensate where it fails to discharge any other obligation under the Act, the rules, or the terms of the agreement for sale.

Two things make this section usable rather than ornamental. The date it measures against is the one written into the agreement under section 13(2), which is why an agreement with a vague possession clause is worth arguing about before you sign it. And the interest rate is prescribed by the State rules made under the Act, not chosen by the promoter — which is what stops a delay from being priced by the party causing it.

Section 19: your own rights, and your own duties

Section 19 is the only section written from the buyer's side, and it runs both ways.

The rights: information relating to the sanctioned plans and layout plans along with the specifications as approved by the competent authority, under section 19(1). The stage-wise time schedule of completion including provisions for water, sanitation, electricity and other amenities, under section 19(2). Possession as per the promoter's own section 4(2)(l)(C) declaration, under section 19(3) — with the association of allottees entitled to possession of the common areas. Refund with interest and compensation where the promoter fails, under section 19(4). The documents and plans, including those of the common areas, after physical possession, under section 19(5).

The duties, which are quoted at buyers far less often: payments in the manner and within the time specified in the agreement for sale, under section 19(6); interest at the prescribed rate on a delayed payment, under section 19(7); participation in forming the association of allottees, under section 19(9); taking physical possession within two months of the occupancy certificate, under section 19(10); and participation in registering the conveyance deed, under section 19(11).

What the Act does not do

It is worth being exact about the limits, because most disappointment with the statute comes from expecting the wrong thing of it.

Using this on a real project

The sections above are only worth memorising in one order, and it is the order a purchase happens in. Confirm the registration exists before you take the project seriously at all, which is section 3. Read what was declared to obtain it, which is section 4, and check that what is published is current, which is section 11. Keep every advertised figure, which is section 12. Get the agreement before the money, which is section 13. Then sections 14, 18 and 19 are the ones you hold in reserve.

Each SUYUG registration number, its authority, the promoter as named on the certificate and the validity date are transcribed on the registrations page, so every one of them can be checked against the register rather than taken from us. The purchase sequence itself, step by step, is on the buyer guide, and the terms used above are defined in the property glossary.