Development authorities are engaged in real estate activity and should therefore register all their projects with Delhi Real Estate Regulatory Authority, Anand Kumar, chairman of the Delhi Real Estate Regulatory Authority (RERA) has said.

He made it clear that even if DDA was building flats with its own funds, the purpose is to sell those units to homebuyers and if those units were delayed, the costs are bound to go up which in turn will impact homebuyers.

“The development authorities must own it up, own up their responsibilities,” he said at an interactive session organised by CII-Delhi State Sub-Committee on Real Estate in association with India Sotheby’s International Realty in Delhi.

“Anybody who is into the real estate development sector, whether it’s a development authority like Delhi Development Authority (DDA) or Delhi State Industrial and Infrastructure Development Corporation Ltd (DSIDC) or any other such organisation, if they are doing plotted development or if they are doing real estate projects, as per section 3, they must get registered with us. And if they do not get registered with us then we have got enough power to take action against them under sections 59 and 61 of the Act,” said Kumar.

“In fact, we have given our orders and judgment asking DDA to register with us and DDA has gone and appealed against our order. Even if you are building flats with your own funds, what is the end purpose? Is DDA going to keep these flats for themselves? The answer is No. After they complete the building, they are going to sell these flats to the end users i.e. the buyers. Now if DDA delays the project, if the cost escalates, who is going to suffer, the buyer,” he said.

Anybody who hands over a building or apartment is responsible to maintain the quality for five years, as per the RERA Act. "Considering all these, DDA must register all their projects with us. So, we have said so in very clear terms and our order is on the website. The development authorities must own it up, own up their responsibilities," he said.

Elaborating on the amendments made to the Act that make it mandatory for projects to get registered, he said, "It is now mandatory for builders to register projects with RERA where plot area exceeds 500 square metres, regardless of the number of units constructed on it. Similarly, irrespective of the plot size, if the number of units to be constructed on the plot is eight or more, it should get registered."

“To protect the interest of allottees, all shops, flats, plots, and office spaces have to be registered under RERA. If real estate projects come up on a plot size of more than 500 sg m, you have to register with RERA and it costs a few thousands. Even eight units on a 100 sq m plot have to be registered under RERA,” he said.

The purpose of registration is to ensure that the project has the necessary approvals and sanctions. It enhances transparency about funds collected from allottees, timely completion and so on. “In many cases, we have observed that a project registered with RERA commands a premium compared to other projects,” he said.

The chairman also said that a heavy penalty will be levied on projects that are not registered.

To promote ease of business, the Authority has set a deadline of 30 days, within which the project is registered. “If all the documents are in order, RERA approval will be given within two weeks,” he said.

The issue of completion certificates was also discussed. “We will urge the government to make the completion certificate a must at the time of property registration, this is very important,” said Kumar.

Amit Goyal, CEO, India Sotheby’s International Realty said that the clarification order issued in May that registration is a must for every project on a land parcel of more than 500 sq m is a critical move to protect homebuyers.

“We need a healthy mix of end buyers and investors to keep an asset class like real estate buoyant and upbeat. I’m quite hopeful once confidence is back, investors too will start considering investing in real estate,” he added.