This forth coming winter session of the parliament will usher in the passing of the long awaited real estate bill. The ministry of Urban Development has accepted all the amendments of the bill as proposed by the parliamentary committee and is all set to get the legislation approved by the cabinet and finally take it to the parliament according to the official sources.
An informal group of ministers examined the select committee’s report of the Rajya Sabha on the Real estate Development and Regulation Bill. They also decided that it would be politically right to accept all the recommendations of the parliamentary committee and push the bill to the parliament.
Few of the amendments include factors like interest payable by the developer and allotees of flats and apartments in case of default from either of the parties. At the present moment the homebuyers are the ones who are taxed the most who pays 16 to 18 percent interest for any default and the developers pay only 2 to 3 percent. The committee recommended that in the eventuality of any default by either of the parties the interest rates payable by both the builder and the allotees of the flats should be the same.
In this regard the select committee reinforced a penalty provision of imprisonment of up to three years by the government and also improvised the imprisonment clause for the developer failing to comply with the orders of the appellate tribunal.
Although all would agree that a regulator in this respect to curb the impending malpractices of the realty sector was required as it was the harbinger and incubator of black money. But this is also a fact that harsh codes of law does not help. On top of that a very strict procedure for the noncompliance of the directives of the appellate tribunal will also be a great deterrent to the sector too. This has to be kept in the mind that apart from the developer’s hand, projects are often delayed due to the delay in the issuance of permits and for obtaining approvals and clearances.
The rationale behind this is to smoothen things up and to bring the government agencies under the ambit of law so that they are also accountable for wrong and unwanted periods of delay. However to get rid of undue speculation the government should also look in to the matter of solving the problem of mitigating the artificial shortage of land which can be policy induced. The state should make an endeavor to make more land free for use in the urban area to speed up development. This must also ensure that the rules and laws in force must be practical and the absurdity in legislature should be replaced.
An informal group of ministers examined the select committee’s report of the Rajya Sabha on the Real estate Development and Regulation Bill. They also decided that it would be politically right to accept all the recommendations of the parliamentary committee and push the bill to the parliament.
Few of the amendments include factors like interest payable by the developer and allotees of flats and apartments in case of default from either of the parties. At the present moment the homebuyers are the ones who are taxed the most who pays 16 to 18 percent interest for any default and the developers pay only 2 to 3 percent. The committee recommended that in the eventuality of any default by either of the parties the interest rates payable by both the builder and the allotees of the flats should be the same.
In this regard the select committee reinforced a penalty provision of imprisonment of up to three years by the government and also improvised the imprisonment clause for the developer failing to comply with the orders of the appellate tribunal.
Although all would agree that a regulator in this respect to curb the impending malpractices of the realty sector was required as it was the harbinger and incubator of black money. But this is also a fact that harsh codes of law does not help. On top of that a very strict procedure for the noncompliance of the directives of the appellate tribunal will also be a great deterrent to the sector too. This has to be kept in the mind that apart from the developer’s hand, projects are often delayed due to the delay in the issuance of permits and for obtaining approvals and clearances.
The rationale behind this is to smoothen things up and to bring the government agencies under the ambit of law so that they are also accountable for wrong and unwanted periods of delay. However to get rid of undue speculation the government should also look in to the matter of solving the problem of mitigating the artificial shortage of land which can be policy induced. The state should make an endeavor to make more land free for use in the urban area to speed up development. This must also ensure that the rules and laws in force must be practical and the absurdity in legislature should be replaced.
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