With the Real Estate Regulatory Authority (RERA) Act coming into force from May 1, there has been a slowdown in the registration of layouts and projects, resulting in a dip in collection of stamp duty and revenue loss to the government.
Sources said the local bodies used to earn a significant amount of income from stamp duty. This had come down drastically this year.
The government, on July 26, notified the Puducherry Real Estate (Regulation and Development-General) Rules and Puducherry Real Estate (Regulation and Development-Agreement for Sale) Rules 2017.
The Central Act came into force on May 1. The rules make registration of all real estate projects with RERA mandatory if the land to be developed exceeded five square metres or the number of flats exceeded eight.
“Out of seven projects, only four have been registered so far, while one has been rejected and two others have been taken up for reconsideration. Of the four projects registered, one is in Puducherry, while three are in Yanam, an enclave of the Union Territory.
“A majority of the projects could not complete their registration as they missed the deadline and failed to register with RERA,” a top government official told The Hindu.
The Puducherry Planning Authority (PPA) has started issuing notices to promoters for unregistered projects. As many as 112 ongoing projects have been identified and notices issued to 46 promoters so far, the official said.
However, promoters in Puducherry said there were several issues with RERA Act. The Central Act has come into effect retrospectively covering all the existing apartments as well as those under construction in Puducherry. This had come as a shock to flat promoters.
S. Thangamanimaran of Jeno Maran builders and vice-president of CREDAI told The Hindu: “As many as 600 apartments were hanging in balance without seeing registration because of the implementation of RERA. It is indeed a surprise that the Puducherry government has not come out with any move to amend the bye-laws.
“As many as 16 States, including Andhra Pradesh, Telangana and Tamil Nadu, had already effected amendments to bylaws to exempt existing buildings from the ambit of RERA. But nothing has been done in Puducherry crippling the continuation of the projects. A majority of the builders have cut down the strength of the workers by 25% as construction activities have come to a standstill.Delays not addressed
RERA has caused severe loss of revenue because of fall in the collection of Goods and Services Tax (GST). Although the RERA Act brings in transparency in transactions and safeguards the buyer’s interest, it has not addressed delays at the government level.
The Floor Space Index rate was very low in Puducherry. RERA allowed only carpet area to be sold by the promoter. In Puducherry, land availability was limited and the land cost was high. The cost per sq. feet in urban areas would increase considerably because of RERA, Mr. Thangamanimaran said.
Note: All Inforamtion provided by third party source.