Maharashtra: Over 1000 Real Estate Ads Deemed Misleading
Developers in Maharashtra continue to exploit weak penalties, misleading flat buyers with false claims. Consumer rights bodies raise serious concerns over MahaRERA's lax action.
Real EstateMisleading AdsMahareraMaharashtraConsumer RightsReal Estate MaharashtraJan 11, 2025
In a letter to the Secretary of Consumer Affairs, Union Government, the forum highlighted the inadequate deterrent action taken by the Maharashtra Real Estate Regulatory Authority (MahaRERA) against developers who deceive flat buyers through false advertising.
The forum's concerns are based on the Advertising Standards Council of India (ASCI)'s half-yearly report (April–September 2024).
The report revealed that out of 2115 real estate ads screened in Maharashtra, 1027 were found to be misleading and in violation of the Real Estate (Regulation and Development) Act (RERA).
Despite an MoU signed in February 2024 between MahaRERA and ASCI to monitor and address misleading ads, the effectiveness of this partnership has been questioned due to the lack of substantial penalties for violators.
ASCI’s report stated, “From 2115 real estate ads screened, 1027 were flagged for potential violations of MahaRERA regulations.
While 59 per cent of advertisers complied by modifying or withdrawing their ads, 628 developers were penalised, with fines totalling Rs 88.90 lakh.” This translates to an average fine of Rs 14,156 per project, a sum that many experts argue is insufficient to deter wrongdoing.
Advocate Anil Dsouza, Hon.
Secretary of the MahaRERA Bar Association, emphasized the need for stricter penalties.
“ASCI and MahaRERA are doing their best, but stricter penalties are essential to combat misleading advertisements effectively.
Honest advertisements reduce litigation and foster trust between promoters and buyers.
MahaRERA and ASCI must be more vigilant to ensure clean practices,” he said.
Dsouza also called for tighter collaboration with industry bodies such as CREDAI-MCHI and NAREDCO to ensure compliance with regulations.
Abhay Upadhyay, President of the FPCE, provided a consumer perspective on the issue.
“ASCI has reviewed advertisements based on MahaRERA’s guidelines, but from a consumer standpoint, these ads often mislead.
Images rarely match the actual projects, QR codes fail to provide accurate details, and disclaimers allow promoters to change project details, violating RERA Act prohibitions,” he explained.
Upadhyay noted that the relatively low fines—averaging Rs 15,000-20,000—make it profitable for developers to continue misleading buyers.
“With such negligible penalties, developers trap hundreds of buyers with false promises, causing significant harm to homebuyers,” he added.
Ramesh Prabhu, Founder Chairman of the Maharashtra Societies Welfare Association (MahaSEWA), echoed these concerns.
“Once ASCI refers a particular real estate advertisement with discrepancies to MahaRERA, it becomes MahaRERA's responsibility to issue show-cause notices to such promoters under Section 12 of the RERA Act.
MahaRERA should initiate legal proceedings and consider cancelling project registrations instead of merely imposing token penalties,” he stated.
Prabhu further suggested that MahaRERA should publish details of misleading advertisements on its official website to help buyers make informed decisions.
The ASCI report also highlighted several key findings during the April-September 2024 period - 4016 complaints were addressed.- 3031 ads were reviewed for potential code violations.- 98% required modifications.- 53% were withdrawn or modified without contest.- 90% of cases were flagged via proactive monitoring.- The average case resolution time was 18 days.- 2087 digital media ads violated laws.- 1027 ads breached the MahaRERA Act.- 890 ads promoted illegal betting and gambling.- 156 ads violated the Drugs and Magic Remedies Act.
These findings underscore the urgent need for stricter regulations and enforcement to protect homebuyers from misleading real estate advertisements in Maharashtra.
Frequently Asked Questions
What is the main concern raised by the Forum for People’s Collective Efforts (FPCE)?
The FPCE is concerned about the proliferation of misleading real estate advertisements in Maharashtra, which deceive flat buyers and violate the RERA Act.
How many real estate ads were found to be misleading in March 2024 according to the ASCI report?
According to the ASCI report, 1027 out of 2115 real estate ads screened in Maharashtra were found to be misleading and in violation of the RERA Act.
What steps has MahaRERA taken to address the issue of misleading ads?
MahaRERA signed an MoU with ASCI in February 2024 to monitor misleading ads and protect flat buyers. However, the effectiveness of this partnership has been questioned due to the lack of substantial penalties for violators.
Why are current penalties for misleading advertisements considered insufficient?
The average fine for misleading advertisements is Rs 14,156 per project, which many experts argue is insufficient to deter wrongdoing and protect homebuyers from false claims.
What additional measures does Ramesh Prabhu suggest to combat misleading real estate ads?
Ramesh Prabhu suggests that MahaRERA should initiate legal proceedings and consider cancelling project registrations for violators, and publish details of misleading advertisements on its official website.
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