Real Estate (Regulation & Development ) Act , 2016
(passed by Lock Sabha and Rajya Sabha)

Brief of above Act, 2016 in respect of important Sections.

Chapter- I (Preliminary)

Section -1

A few items are stated below.

  1. It extends to the whole of  India except the s\state of J & K. 


Section -2

  1. “ Agreement  for Sale  “ means an agreement entered into between the promoter and buyer / allot-tee

  2. “Appellate  tribunal “ meant the Real  Estate Appellate Tribunal established under Section 43

  3. ‘Carpet Area “ means the net usable floor area of an apartment excluding the area covered  by the external walls, areas under services shafts, exclusive balcony or verandah area and exclusive open terrace area but includes the area covered by the internal walls  of the apartment.

For the purpose of this clause, the expression exclusive balcony or verandah area, means the area of balcony or verandah as the case may be, which is appurtenant to the net usable floor area of an apartment. Similarly terrace area is to be treated.

Details of common area have been stated under this clause/ section.

Completion certificate, or such other certificate, issued by the competent authority  certifying that the real estate project has been developed according to the sanctioned plan, layout plan and specifications, as approved by the competent authority under local laws.


  1. Member means the member of the Real Estate Regulatory Authority appointed under section 21 and includes the Chairperson.

  2. Sanctioned plan means the site plan, building plan, service plan parking and circulation plan, landscape plan, layout plan , zoning plan and such other plan and includes structural design if applicable, permissions such as environment permission and such other permissions which are approved by the competent authority prior to start of real estate project.



Registration of Real Estate Project and Registration of Real Estate Agents

( A few items are stated here)

Section -3 

      Prior registration of real estate project with Real Estate Regulatory Authority is to done. No promoter shall advertise, market, book, sell or offer for  sale or invite persons to purchase in any manner any plot, apartment or building, without registering the real estate project with the aforesaid regulatory Authority.

Section -4

Every promoter shall make an application to the Authority registration of the real estate project in such form, manner, within required time an accompanied by specified fee. Many details with various documents of the real estate project are to be submitted with the application such as:-

Sanctioned plan, layout plan, specifications of the proposed project, proposed facilities including fire fighting facilities, drinking water, emergency evacuation services,  use of renewable energy, agreement for sale, proposed conveyance deed, number type and the carpet area if apartment  for sale  (exclusive balcony, verandah area, open terrace etc.)

A  declaration , support by an affidavit, which shall be signed by the promoter  or his authorized  person. Time period within  which promoter undertakes to complete the project  or phase there of  .70% of the amounts realized for the project from the allot-tees, from time to time shall be deposited in a separate account(  known as Escrow account) to be maintained in a scheduled bank to cover the cost of  construction and land.

Section -9

   Registration of real estate agents. No Real estate agent shall facilitate the sale or purchase or act on behalf of any person to facilitate the sale or purchase of any plot, apartment or building without obtaining registration under this section.


Chapter –III

Functions and duties of promoter



 The promoter shall, upon receiving   his Login Id and password, crate his web page on the website of the Authority and enter all details of the proposed project. The advertisement or prospectus issued or published by the promoter shall mention prominently the website address of the Authority, where in all details of the registered project have been entered and include the registration number obtained from the Authority and such other matters. The stage wise time schedules of completion of the project etc. are to be stated in the website. There are many responsibilities for the promoter and the same are to be stated in the website.


Section -13 

  A Promoter shall not accept a sum more than ten parent of the cost of the Apartment, plot or building as the case may be, as an advance 

 Payment or an application fee, from a person without first entering into a written agreement for sale with such person and register the said agreement for sale.


Section -14

The proposed project shall be developed and competed by the promoter in accordance with the sanctioned plans, layout plans and specifications as approved by the statutory authorities.



If the promoter fails to complete or is unable to give possession of apartment as per “agreement to sell” then the promoter shall be liable on demand to allottees, to return the amount received by him in respect of that apartment with interest.


Chapter –IV

    Rights and duties of Allot – tees.


Section – 19

  1. The allot – tee shall be entitled to obtain the information relating to sanctioned plans, layout plans along with specification etc.


  1. The allot –tee shall be entitled to know stage-wise time schedule of completion of the project, including the provisions for water, sanitation, electricity and other amentities and services as agreed to between promoter and the allot – tee in accordance with the terms & conditions of the agreement for sale.


  1. The allot –tee shall be entitled to claim the possession of apartment and the association of allot – tees shall be entitled to claim the possession of the common areas, as per the declaration given by the promoter.

(iv)The allottee shall be liable to pay interest, at such rate as may be prescribed for any delay in payment towards any amount.

There other items.

Chapter – V

Real Estate Regulatory Authority


Section – 20, 21,23&24

  The appropriate Government shall, within a period of one year from the date of coming into force of this Act, establish an Authority to be known as the Real Estate Regulatory Authority to execute the powers conferred on it and to perform the function assigned to it under this Act.

  The authority shall consist of a Chairperson and not less than two whole time Members.  Chairperson and Members of the authority shall be appointed by the Government on the recommendations of a selection committee of chief justice oh high court, secretary of the dept, dealing housing and law secretary.  They shall hold office for a term of not exceeding five years.  Government may in consultation with the authority appoint such officers and employees as it considers necessary.  The questions which come up before the authority shall be dealt with as expeditiously as possible and the Authority shall dispose within a period of 60 days.

Section – 31

  Any aggrieved person may file a complaint with the Authority or the adjudicating officer, for any violation or contravention of the provisions of this Act or Rules and Regulations made there under against any promoter, allottee or real estate agent. “person” shall include the association of allottees.


Section – 32

 The authority shall in order to facilitate the growth and promotion of a healthy, transparent, efficient and competitive real estate sector make recommendation to the Govt.

Section – 34, 38

  The functions of Authority shall include;-

  To register and regulate real estate projects and real estate agents registered under this Act.  To publish and maintain a website of records, for public viewing of real estate projects.  To maintain a database on its website, for public viewing and enter the names and photographs of promoters as defaulters including project details etc.  The authority shall have powers to impose penalty or interest in regard to any contravention of obligations cast upon the promoters, allottees.  The Authority shall be guided by the principles of natural justice.

Chapter – VI

 Centre Advisory Council


Section – 41

Central Government may, by notification, established, a Council to be known as The Central advisory Council.   Minister of the Govt.  of India in charge of the Ministry of the Central Govt.  Dealing with Housing shall be the ex – officio Chairperson of the Central Advisory Council


Section 42

The functions of the Central   Advisory Council shall be to advise and recommend the Central Govt.

  • On all matters concurring the implementation off this Act.

  • On major questions  of policy 

  • Towards protection of consumer interest.

  • To foster growth and development of the real estate sector.


Chapter VII

  The Real Estate Appellate Tribunal.


Section -43

The appropriate Govt. shall, shall by notification establish an Appellate tribunal to be   known as “Real Estate Appellate Tribunal. Every bench of the Appellate Tribunal shall consist of at least one Judicial Member and one Administrative to Technical Member. Provided that where a promoter files an appeal with the Appellate Tribunal it shall not be entertained  without the promoter  first having  deposited with the Appellate Tribunal at least thirty percent ( 30%) of the penalty or such higher percentage.


Section -44

Every   appeal made this section shall be preferred within a period of 6+ days for the date on which a copy of the   direction or order made by the Authority or the adjudicating  officer is received by the  appropriate Govt. and it shall be in such form and accompanied by such fee as may  be prescribed.


The appellate Tribunal shall send a copy of every order made by it to the parties and to the Authority or the adjudicating officer, as the case may be.

The appeal preferred under Sub-Section (1) shall be dealt with by  it as expeditiously as possible an Endeavour shall be it to dispose of the appeal within a period of 60 days from the  date  of receipt of appeal.

Section - 46  

A person shall not be qualified for appointment as the chairperson or Member of the Appellate Tribunal unless be  

  1. In the case of Chairperson is or has been a Judge of High Court; and 

  2. In the case of Judicial Member he has held a judicial office in the territory of India for at least 15 years or has been a member of the Indian Legal service.


Section -  53

 The Appellate Tribunal shall not be bound by the procedure laid down by the Code of Civil Procedure, 1908 but shall be guided by the principle of natural justice.

Section -57

Every order made by the Appellate Tribunal under this Act shall be executable by the Appellate Tribunal as decree of Civil Court, and for this purpose, the Appellate Tribunal shall have all the powers of a civil Court.

Chapter –VIII

Offences, penalties and Adjudication

Section -59

  1.  If any promoter contravenes the provision of section-3, he shall be liable to a penalty which may extend up to ten (10) percent of the estimated cost of the real estimate project as determined by the Authority.


  1. If any promoter does not comply with the orders, decisions or directions issued under sub –section (1) or continues to violate the provisions of section -3, he shall be punishable with imprisonment for a tem which may extend up to three years or with fine which may extend up to a further ten percent of the estimates cost of the real estimate project or with both.

Section -60

If any promoter provide false information or contravenes the provision of section-4, he shall be liable to a penalty   which may extend up to five percent of the estimated cost of the real estate project, s determined by the Authority.

Section -62

If any real estate agent fails to comply with or contravenes the provision of Section-9 or section10, he shall be liable to a penalty of ten thousand rupees for every day during which such default continues, which may cumulatively extend up to five percent of the cost of plot or apartment.


Section -63 

If any  promoter ,w ho fails to comply with or  contravenes any of the orders or directions of the Authority, he shall be liable to a penalty  for every  day during  which  such default continues, which may cumulatively  extend up to five percent, of the estimated cost of the real estate project as determined by the Authority.


Section - 66

 If any real estate agent, who fails to comply with or  contravenes any of the orders , decisions or directions of the Appellate Tribunal, he shall be punishable with imprisonment for a term which may extend up to one year or with fine for every day during which  such default continues.


Section - 69

Offence by companies – where an offence under the act has been committed by a company, every person who, at the time, the offence was committed was in charge of  , or was responsible to the company for the conduct of the business of the company as well as the company, shall be deemed to be quality  of the offence.


Section -71

For the  purpose of adjudging  compensation under sections 12, 14 , 18 & 19 , the Authority  shall appoint in consultation with the appropriate  Govt. one or more judicial officer as deemed necessary, who is or has been District Judge to be an adjudicating  officer for holding an Enquiry in prescribed   manner after giving a reasonable  opportunity.


Chapter –IX 

Finance, Accounts, Audits and Reports

This chapter is not being dealt here.

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