Historically, different levels of government have regulated different aspects of real estate. The Competition Commission of India has pointed out that the absence of a single regulator for the real estate sector is partly responsible for poor grievance redressal. As such, the Real Estate (Regulation and Development) Act 2016 was enacted to address issues related to real estate transactions. In particular, the act seeks to:
- regulate contracts between buyers and sellers;
- ensure consumer protection; and
- standardise business practices.
The act is a pioneering initiative to protect consumer interests, promote fair play in real estate transactions, ensure timely execution of projects and ensure effective growth in the real estate sector. To achieve these goals, the act provides for a uniform regulatory environment. The act also contains provisions regarding:
- the registration of real estate projects and registration of real estate agents with the Real Estate Regulatory Authority;
- the functions and duties of promoters and allottees;
- the establishment of the Real Estate Regulatory Authority;
- the establishment of a fast-track dispute resolution mechanism through adjudication;
- the establishment of the Real Estate Appellate Tribunal; and
- offences and penalties.
The act is expected to ensure greater accountability towards consumers and reduce fraud and delays significantly. It is also expected to promote regulated and orderly growth through efficiency, professionalism and standardisation. It seeks to ensure consumer protection without adding another stage in the penalties procedure.
The measures provided under the act are expected to boost domestic and foreign investment in the real estate sector and help to achieve the government's objective of providing "housing for all by 2022" through enhanced private participation.
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