HRERA Enforces Strict Compliance on Annual Report Submissions by Real Estate Developers
The Haryana Real Estate Regulatory Authority (HRERA) has introduced a mandatory annual reporting requirement for real estate developers, including penalties for non-compliance, to ensure transparency and accountability in the sector.
HreraReal Estate DevelopersAnnual ReportsRera ActPenaltiesReal Estate NewsDec 04, 2024
During a recent review, HRERA noted that numerous developers had failed to submit the necessary reports despite repeated reminders. As a result, the authority has started issuing show-cause notices to non-compliant developers. These notices demand prompt adherence to the deadline and warn that failure to comply will result in substantial financial penalties.
In its order, HRERA emphasized that failing to submit annual reports is a serious violation of the Real Estate (Regulation and Development) Act, 2016 (RERA Act). Developers who do not file the reports within 30 days of receiving the notice will face an initial penalty of INR 5 lakh. Additionally, a daily fine of INR 10,000 will be levied for each day of non-compliance beyond 60 days.
The submission of annual reports is a crucial requirement under Section 4(2)(l)(d) of the RERA Act. Developers must have their project accounts audited by a certified chartered accountant within six months of the end of each financial year. The audit must verify that the funds raised for the project are used exclusively for its intended purpose and that withdrawals align with the project's completion status.
HRERA also pointed out that developers providing false information or breaching Section 4's provisions could face fines of up to 5% of the project's estimated cost, as stipulated in Section 60 of the Act. This provision underscores the importance of maintaining financial integrity in project execution.
The regulator reiterated that these measures aim to promote transparency and accountability within the real estate sector. Developers are urged to comply with these regulations swiftly to avoid significant financial and legal repercussions. HRERA's warning reflects its ongoing commitment to protecting the interests of homebuyers and ensuring the responsible use of project funds.
In conclusion, HRERA's enforcement of strict reporting guidelines signals a strong stance on ensuring transparency and accountability in the real estate sector. By holding developers accountable for submitting accurate financial reports, the regulator aims to protect homebuyers and foster trust in the industry. These measures, coupled with penalties for non-compliance, serve as a warning to promoters to adhere to regulations. Through this initiative, HRERA is working towards upholding financial discipline, ensuring the responsible use of funds, and preventing potential misuse, ultimately benefiting both consumers and the long-term health of the sector.
Frequently Asked Questions
What is the main requirement introduced by HRERA for real estate developers?
HRERA has mandated that real estate developers must submit annual reports for their ongoing projects within 30 days.
What are the consequences of non-compliance with HRERA's annual report submission requirement?
Non-compliant developers face an initial penalty of INR 5 lakh and a daily fine of INR 10,000 for each day of non-compliance beyond 60 days.
What is the purpose of the annual report submission?
The purpose is to ensure transparency and accountability in the real estate sector by verifying that funds are used exclusively for their intended purpose and that withdrawals align with the project's completion status.
Who is responsible for auditing the project accounts?
The project accounts must be audited by a certified chartered accountant within six months of the end of each financial year.
How does HRERA's initiative benefit homebuyers and the real estate sector?
HRERA's initiative aims to protect homebuyers by ensuring the responsible use of project funds and fostering trust in the real estate industry, ultimately benefiting consumers and the long-term health of the sector.
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