RERA Real Estate Regulatory Rules Announcement

Real estate agents must mandatorily register with the Regulatory Authority.

The Tamil Nadu government has announced real estate regulatory rules. Accordingly, real estate agents must mandatorily register with the Regulatory Authority. These rules will apply to all ongoing and future projects, as announced by the Tamil Nadu government.

The central government implemented the Real Estate Regulation and Development Act from May 1st. Following this, the Tamil Nadu government has created the Tamil Nadu Real Estate (Regulation and Development) Rules, 2017.

Accordingly, a selection committee comprising a judge of the Chennai High Court or their representative, the Secretary of Housing and Urban Development, and the Secretary of the Law Department will provide appropriate recommendations for the chairman and two members of the Regulatory Authority/Tribunal. Until then, the Secretary of Housing and Urban Development will act as the interim chairman.

Key features of the Tamil Nadu Real Estate (Regulation and Development) Rules, 2017 are as follows:

- All real estate agents involved in the sale of plots or buildings over 500 square meters or more than eight units must register with the Authority. These rules apply to all ongoing and future projects.

- No sale of any plot or building can be conducted without registration with the Authority.

- 70% of the amount collected from the allottees for the project must be deposited in a separate account and used only for the specified project and construction expenses.

Every promoter must provide an affidavit stating that the land for the project is free from any encumbrances and that they have legal ownership of the land. They must also specify the completion time for the project in the affidavit.

Without a written agreement, no promoter can collect more than 10% of the project’s value from the allottees. The total value of the unit must be specified in the agreement. If there are any defects in the construction, workmanship, quality, or service within five years of allotment, the promoter must rectify them at their own expense within 30 days.

Any person aggrieved by the decisions or actions of the Authority or the Adjudicating Officer can appeal to the Appellate Tribunal. The Appellate Tribunal will consist of a chairman and two members. One member will be a judicial officer, and the other will be an officer from administration or technical fields.

Various penalties are provided under this Act. Penalties can be up to 10% of the project’s value or three years of imprisonment or both. Both promoters and consumers must pay the same interest rate in case of default in their obligations. The Tamil Nadu government's Real Estate Regulatory Authority and Appellate Tribunal will also include the Andaman and Nicobar Union Territory. The Authority’s office will temporarily operate on the third floor of Thalamuthu Natarajan Building in Egmore, Chennai.