Brochures of only registered projects to be legal entities: MPRERA


In a setback to homebuyers, Madhya Pradesh Real Estate Regulatory Authority (MPRERA) has taken the stand in a recent judgement that builders would be held accountable for failure to provide amenities promised in sale brochures and legal action initiated against them only if the project is registered under Real Estate Regulatory Authority (RERA). 


As per judgement by MPRERA, brochures and model flats of any residential or commercial projects will be treated as legal entity only if the project is registered under RERA.


Madhya Pradesh implemented RERA on May 1, 2017.  Though agreements on amenities done before RERA shall be considered as legal entity. In recent hearings under state regulatory authority, many complainants approached the board seeking action against builders for not providing amenities as promised in the brochures in cases pertaining to as old as 2013 but the board refused to accept the brochures as legal entity. 


A complainant Anand Kumar Nama said, "I got the possession of my flat in 2015 but most of the amenities promised in brochures to us such as swimming pool, temple and club house does not exist." 


The regulatory authority after hearing the case ordered that the brochures printed before implementation of RERA cannot be treated as legal entity.


A D Kapaley, member of the state regulatory authority said, "In RERA there is a condition that facilities mentioned in brochures and pamphlets should be fulfilled by builder otherwise he will be bound for legal action. But amenities promised in brochures before implementation of RERAcannot be considered as legal entity or else there should be an official agreement between builder and customer."


As per the rule, builders are required to update their websites every quarter with the latest developments in their registered projects.  Non-compliance may invite action from regulators. Sunil Agrawal, a builder said, "Builders should fulfil all the promises made to customers verbally or on papers. Registration under RERA should not be the deciding factor for taking action against the nonfulfillment."

Written by The Realty Paper

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