Diluted realty Act may invite public wrath, Govt tells states

MUMBAI: The Centre has warned states against watering down the real estate regulation law as passed by Parliament and has said any such move will have serious implications, including a public outcry. The Centre has also made it clear that all ongoing realty projects that have not received completion certificate by May 2017 will come under the regulatory mechanism.
On Tuesday, Union housing minister M Venkaiah Naidu told chief secretaries and secretaries of state housing departments that the Real Estate Regulation Act is one of the most consumer-friendly laws passed by Parliament and states have no power to dilute its provisions.“There is lot of hope and expectations from this Act by all stakeholders. There are some media reports that some states have diluted some provisions of the Act in the rules notified by them. States don’t have such powers and I hope such reports are not true. Today, I want to make it clear that any compromise with the spirit of the Act will have serious implications including public outcry. Whoever does so will have to face the public outcry,” Naidu told the state representatives. The warning comes amid reports of some of the BJP-ruled states such as Gujarat, Madhya Pradesh and Maharashtra diluting some of the provisions, which could end up favouring builders. Even Uttar Pradesh has come out with rules, which do not comply with the central law with regard to ongoing projects. Gujarat has also diluted this provision in favour of builders.
The housing ministry, on Tuesday, also turned down all proposals to amend some of the existing provisions such as bringing all projects that are built over plots beyond 500 sq m size under the law. But housing secretary Nandita Chatterjee told states that no amendments to the Act would be considered at this stage since full implementation of the Act would begin only in May.
The ministry has said that the law was framed after years of discussion with all stakeholders and the parliamentary committees have gone through each provision. Responding to the issue of excluding balconies from the definition of carpet area, it was explained that it posed no problems as costing could be accordingly informed to the buyers. The ministry has agreed to come out with a template for a website to be made operational for disclosure of a range of information about the projects as mandated under the Act. Under the law, each state regulator has to have a website to provide details about projects and the builders. Any expenditure incurred by the promoters on development of land could be included as part of the cost of land, the ministry told states.
States such as Andhra Pradesh, Arunachal Pradesh, Haryana, Himachal Pradesh, Jharkhand, Karnataka, Kerala, Mizoram, Rajasthan, Tamil Nadu and Puducherry have told Centre that the regulatory rules would be notified by next month. Punjab and Uttarakhand have said they would take the plan ahead after the state elections. So far Gujarat, MP Maharashtra, UP, Delhi and Chandigarh have notified rules or draft rules.