corporate law
The Uttar Pradesh Real Estate Regulatory Authority (UP-RERA) is taking significant measures to protect home buyers by introducing comprehensive Standard Operating Procedures (SOPs). These initiatives aim to create a clear framework for buyers when builders fail to adhere to UP-RERA guidelines, enhancing transparency, accountability, and options for recourse in the real estate sector.
Recent data indicates that 65 developers in Uttar Pradesh have defaulted on their obligations, leaving many home buyers in precarious situations. While UP-RERA has issued various orders favoring buyers, numerous builders have neglected their responsibilities regarding refunds, timely possession, and submission of required documents. This ongoing non-compliance highlights the need for structured interventions.
Clear Escalation Pathways: The SOPs outline step-by-step actions for buyers, detailing the procedures from filing complaints to enforcing orders when builders do not comply.
Online Access: All guidelines will be readily accessible on the UP-RERA website, benefiting all stakeholders involved.
Builder Compliance Dashboards: Each registered builder must maintain a real-time compliance dashboard on the UP-RERA portal, indicating the status of orders and compliance milestones.
Strict Timelines and Follow-Ups: UP-RERA has instituted individual follow-up processes with strict deadlines for builders, accompanied by penalties for delays or non-compliance.
To address persistent defaults, UP-RERA is partnering with government-backed auction houses to auction the assets of builders who fail to comply. Proceeds from these auctions will be used to reimburse affected home buyers, representing a pioneering initiative in the state. For instance, UP-RERA has attached and plans to auction 111 flats and shops from Wave Mega City Center, a builder with recovery certificates exceeding ₹123 crore. This approach will be extended to other non-compliant developers.
"By attaching and auctioning properties, UP-RERA is sending a clear message: non-compliance will have tangible financial consequences." — UP-RERA Official Statement
According to Section 63 of the RERA Act, UP-RERA possesses the authority to impose penalties of up to 5% of the total project cost on non-compliant developers. In recent years, the authority has levied fines aggregating several crores and revoked registrations for repeat offenders. Notable developers such as Supertech, Mahagun India, and Ansal Properties have faced significant penalties for failing to adhere to UP-RERA directives.
Real-Time Monitoring: Compliance dashboards and Management Information Systems (MIS) allow buyers to monitor the status of their complaints and builder compliance in real time.
Public Disclosure: Details regarding assets, compliance status, and penalty records are now publicly accessible, enhancing transparency and bolstering buyer confidence.
Since its establishment in 2017, UP-RERA has successfully recovered and disbursed over ₹1,232 crore to more than 5,000 home buyers who were denied possession of their properties. In the past 17 months alone, ₹674 crore has been recovered from defaulting builders due to proactive enforcement and digital monitoring. Nevertheless, only four of the 65 defaulting builders have disclosed their assets, highlighting ongoing challenges in asset tracing and enforcement.
Stricter Enforcement: UP-RERA is intensifying its focus on the implementation of all orders, including legal actions and public disclosures of habitual defaulters.
Enhanced Buyer Support: The new SOPs provide buyers with clear guidance and support channels, simplifying the process for seeking justice and compensation.
Collaborative Recovery Efforts: By working with district authorities and leveraging technology, UP-RERA aims to expedite recovery processes and hold errant builders accountable.
UP-RERA's initiatives reflect best practices implemented in states like Maharashtra and Gujarat, where digital dashboards, public disclosures, and stringent asset monitoring have led to improved compliance and increased buyer satisfaction.