Lok Sabha Question No. 1113 (UNSTARRED), answered on 2021-02-08
Subject: Relief to Home Buyers
Ministry: CORPORATE AFFAIRS
Asked by: Bharti Pravin Pawar

## GOVERNMENT OF INDIA MINISTRY OF CORPORATE AFFAIRS

## LOK SABHA

## UN-STARRED QUESTION NO. 1113

ANSWERED ON MONDAY, FEBRUARY 8, 2021/ MAGHA 19, 1942 (SAKA)

## RELIEF TO HOME BUYERS QUESTION

1113.  DR. BHARATI PRAVIN PAWAR:

Will the Minister of CORPORATE AFFAIRS be pleased to state:

कॉरपोरेट कार्य मंत्री

- (a) the details of action being taken by the Government to provide relief to the homebuyers whose money is stuck up in the real estate projects;
- (b)  the  details  of  number  of  real  estate  projects  lying  incomplete  in  the country  and  the  number  of  homebuyers  whose  money  is  stuck  in  these projects;
- (c) whether the Government has taken cognizance that the homebuyers are facing  difficulty  in  repaying  the  bank  loans  due  to  these  incomplete  real estate projects, if so, the details thereof; and
- (d) whether the Government proposes to formulate any policy to protect the interests of such homebuyers and if so, the details thereof?

## ANSWER

THE MINISTER OF STATE FOR

FINANCE AND CORPORATE AFFAIRS

वित्त एिं कॉरपोरेट कार्य मंत्रालर् में राज्य मंत्री

(SHRI ANURAG SINGH THAKUR) ( श्रीअनुराग व ंह ठाक ु र )

- (a)  to  (d):  The  Government  in  the  Ministry  of  Corporate  Affairs  (MCA) administers  the  provisions  of  the  Companies  Act,  2013  and  the  Limited Liability  Partnerships  (LLPs)  Act,  2008  and  the  Insolvency  and  Bankruptcy Code  (IBC), 2016.  Information  regarding  relief  to  home  buyers  is  not maintained  by  MCA.  However,  allottees  in  the  real  estate  projects  are considered as financial creditors under the Insolvency and Bankruptcy Code, 2016. This entitles them to initiate insolvency proceedings and submit claims in an insolvency proceedings and join the committee of creditors.

However, Ministry of Housing and Urban Affairs  (MoH&UA)  has informed that in order to protect the interest of homebuyers, MoH&UA has enacted the Real Estate (Regulation and Development) Act, 2016 (RERA).

As per Section 20 of the RERA, the 'Appropriate Government' i.e. the States/Union  Territories  (UTs)  are  required  to  establish  the  Real  Estate Regulatory Authority to regulate and promote the real estate sector in the respective States/UTs.

As  per  the  provisions  of  RERA,  real  estate  projects  and  real  estate agents  are  required  to  get  registered  with  the  Real  Estate  Regulatory Authority of the concerned State/UT before advertising, marketing, booking, selling  in  any  manner.  Real  Estate  Regulatory  Authority  is  required  to maintain a website, containing relevant details of all registered real estate projects and publish these details for public viewing.

RERA  provides  for  compulsory  deposit  of  seventy  percent  of  the amount realised from allottees in a separate bank account to cover the cost of  construction  and  land.  It  also  mandates  promoter  to  declare  the  time period with in which, real estate project has to be completed. Promoter is liable for refund of amount with interest and compensation, in case he fails to  complete or is unable to give possession of apartment, plot, building to home buyers as per the terms of the agreement for sale.

RERA further  provides  for  punishment  up  to  3  years  of  imprisonment and/or with fine, which may extend up to ten percent of the estimated cost of  the  real  estate  project,  in  case  the  promoter  fails  to  comply  with  the Regulatory orders, decisions or directions issued by the Real Estate Authority or Real Estate Appellate Tribunal.

For  redressing  the  grievances/complaints/applications  of  homebuyers, RERA provides for an Adjudicating Officer, Real Estate Regulatory Authority and Appellate Tribunal and provides a robust mechanism for the purpose.

Section 34 of RERA also enables the Real Estate Regulatory Authority to  maintain  a  database,  on  its  website,  for  public  viewing,  and  enter  the names and photographs of the defaulting Promoters, or the promoters who has been penalised under the Act, with reasons therefor, and the details of the  projects  for  which  registration  has  been  revoked,  for  access  to  the general public.

Further,  'Land'  and  'Colonisation'  are  state  subjects.  So  Ministry  of Housing and Urban Affairs does not maintain data on housing projects.

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