Karnataka: RERA is finally here, but loopholes galore

Bengaluru: Although the state cabinet has approved the Real Estate (Regulation and Development) Act (RERA) after dragging its feet for long, the builder – developer community and consumers are in a fix as the Act does not spell out clear implications.

The state government has said that those properties which have completed 60 per cent of the structure and the property should be registered in the name of buyer will be exempted from the Act.

Farook Mahmood, Chairman and Managing Director, SilverlineGroup told Deccan Chronicle that from the point of view for industry it is very good as it ensures it is organised. However, the builder-developer community is concerned about the rules that will be formed and announced.

Although the government says that they are following Rajasthan model by taking 60 per cent bench mark to exempt builders from the RERA, it is hard to determine the per centage of completion of the building, he explained.

Further, who is the deciding authority or official to determine the percentage of construction. 

The simplest method to clear the ambiguity is to exempt those builders and developers who have obtained Commencement Certificate (CC). This is very clear that those who have obtained CC have obtained all the requisite permission from the authorities, he said.

Sources in the realty sector said that the 60 per cent benchmark creates avenue for corruption. 

For instance, the authority concerned, once his hands are greased, may allow any builder to go ahead with the project by giving a stamp that the building is 60 per cent complete. 

This is very unfair and the interest of consumers have been ignored, despite the fact that RERA was intended to be a consumer centred Act, they added.