Circular No.TNRERA/A3/1677/2025, Registration of real estate projects (Layouts and Sub Divisions), On-going Developments, collection of Security Deposit
The Tamil Nadu Real Estate Regulatory Authority issued Circular No. TNRERA/A3/1677/2025 dated 15 May 2025, bringing its circular dated 7 May 2025 into force from 1 June 2025. It requires promoters of ongoing layout and subdivision developments to pay a refundable, non interest earning security deposit to support completion of development works and compliance with planning authority, local body and no objection certificate agency conditions.
What the circular governs
Circular No. TNRERA/A3/1677/2025 of the Tamil Nadu Real Estate Regulatory Authority applies to ongoing real estate layout and subdivision developments. These are projects where development works remain in progress and the promoter has declared a future completion date in Form-B.
The security deposit requirement takes effect from 1 June 2025. Its stated purpose is to help ensure that promoters complete development works and meet conditions imposed by planning authorities, local bodies and no objection certificate agencies.
Who is affected
The Tamil Nadu Real Estate Regulatory Authority security deposit requirement directly affects promoters seeking registration of ongoing layout projects. It is intended to protect the public where the Authority may otherwise find it difficult to verify completion of works and compliance with approval conditions.
Security deposit amounts
The refundable deposit is calculated using the layout extent or project cost slabs:
- Up to 1 acre, or project cost up to Rs.1 crore: Rs.1 lakh.
- More than 1 acre and up to 5 acres, or project cost above Rs.1 crore and up to Rs.5 crore: Rs.5 lakh.
- More than 5 acres and up to 10 acres, or project cost above Rs.5 crore and up to Rs.10 crore: Rs.10 lakh.
- More than 10 acres, or project cost above Rs.10 crore: Rs.20 lakh.
For calculating layout extent, common areas and land donated to a local body, Tamil Nadu Generation and Distribution Corporation Limited or similar bodies are included.
The examples show that either project cost or layout extent can place a project in a higher slab. A 0.75 acre project costing Rs.1.5 crore attracts Rs.5 lakh, while a 6 acre project costing Rs.5 crore attracts Rs.10 lakh.
Completion and refund
The Tamil Nadu Real Estate Regulatory Authority will issue a Completion Report and refund the deposit after:
- Development works are completed.
- Planning authority and local body conditions are met.
- A certificate is furnished by the architect or engineer involved in the project.
The Authority may inspect the site before issuing the Completion Report and releasing the deposit. After refund is ordered, the Accounts Officer must transfer the amount online without interest, record it in the system and submit monthly refund statements to the Authority.
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Common questions
When did the security deposit requirement take effect?
Circular No. TNRERA/A3/1677/2025 dated 15 May 2025 states that the requirement introduced by the circular dated 7 May 2025 comes into force on 1 June 2025.
Does the layout area include common areas and donated land?
Yes. The layout extent includes common areas and land donated to a local body, Tamil Nadu Generation and Distribution Corporation Limited and similar bodies.
Will the promoter receive interest on the security deposit?
No. The security deposit is refundable but does not earn interest.
What must be completed before the deposit is refunded?
Development works must be completed, relevant planning authority and local body conditions must be met, and a certificate from the project architect or engineer must be furnished. The Tamil Nadu Real Estate Regulatory Authority may also conduct a site inspection before releasing the deposit.
