Real Estate (Regulation and Development) Act, 2016 Frequently Asked Questions (FAQs)

What the guidance covers

The Tamil Nadu Real Estate Regulatory Authority explains that the Real Estate (Regulation and Development) Act, 2016 covers residential and commercial real estate, industrial plots, and projects in both planning and non-planning areas. It applies to private and public promoters, including Development Authorities, Housing Boards and other government agencies that develop property for sale.

Ongoing or incomplete projects without a completion certificate are covered, along with future projects. In Tamil Nadu, the Tamil Nadu Combined Development and Building Rules, 2019 provide for a completion certificate rather than an occupancy certificate.

Registration and advertising

The Frequently Asked Questions state that:

• Real estate project registration is available only online.
• A promoter may advertise a project for sale only after registration with the Regulatory Authority.
• Advertisements, prospectuses and photographs published in any medium must prominently and readably show the Tamil Nadu Real Estate Regulatory Authority registration number and website address.
• Solicitation through email and SMS is treated as advertising.
• A registered General Power of Attorney holder may apply if the document executed by the landowner gives the holder power to sell.
• The Regulatory Authority must register a compliant project within 30 days after receiving the application.
• An incomplete application may be rejected only after the promoter is given an opportunity to complete it and an opportunity to be heard.

Projects that do not require registration

Registration is not required where:

• The proposed development does not exceed five hundred square metres, or the proposed number of apartments does not exceed eight, inclusive of all phases.
• The promoter received the completion certificate before the Act commenced.
• Renovation, repair or redevelopment does not involve marketing, advertising, selling or making a new allotment of an apartment, plot or building.

Promoter funds and responsibilities

A promoter must maintain a separate account for every project and deposit seventy percent of money received from allottees for construction and land costs. Withdrawals must match the percentage of project completion and be certified by an engineer, architect and practising chartered accountant.

Accounts must be audited within six months after every financial year ends. Where one person develops the property and another sells it, both are treated as promoters and are jointly responsible.

Buyers and agents

An allottee includes a person acquiring an apartment or plot through a later transfer or sale, but not a tenant. Real estate agents, including web portals selling registered projects, must register with the Authority. If project registration is revoked, the association of allottees has the first right of refusal to carry out the remaining development work.