The sale of development plots not registered with the Kerala Real Estate Regulatory Authority (K-RERA) may face hurdles if the government approves a recommendation by the K-RERA. The authority has written to the chief secretary seeking a directive to the registration department not to allow sales deed registration of such plots not registered with the RERA.
As per law, development projects that exceed 500 sq m of land or those with more than eight apartments, villas or plots require mandatory registration. But many realtors skip the rule contending that registration was not required for projects that did not meet both criteria. Now, the RERA has issued a clarification that each of the criteria is standalone and has warned of penal action against offenders.
Tamil Nadu issued such a directive to sub-registrars and the level of compliance with the law in that state has increased significantly, the letter said. The government is yet to take a decision on the matter. If approved, the rule will pave the way for near-total compliance in the realty sector.
It will also increase the government’s revenue from stamp duty and registration because, usually, actual sales will be recorded in the agreement. Details in the sales deed, like the extent of the property and accessibility details, will help sub-registrars ascertain whether it is a real estate project requiring RERA registration.
“The issue was flagged by some customers who booked units in unregistered projects. Also, we identified many violations by browsing social media advertisements. Suo motu action was taken against them. We hope that the clarification will result in more compliance. More buyers will get protection under the provisions of the Kerala Real Estate (Regulation and Development) Rules, 2018,” K-RERA chairman P H Kurian said. Delhi and Rajasthan had issued this clarification earlier.
Offenders will face a penalty of up to 10% of the project cost. The RERA is now working in tandem with the local self-governments to book violations. LSG secretaries have been asked to pass on information about projects which do not have K-RERA registration and the mandatory permit from LSGs. All real estate projects, irrespective of their threshold, require a permit from the local self-government.