The state government of West Bengal on Friday finally notified the Housing Industry Regulation Act (HIRA), 2017, for the state. It is coming nine months after it was passed in the assembly. However, the Act will remain ineffectual till a regulator is appointed, regulations are framed and a website is created where information on housing projects is provided and appellate tribunals are set up for resolving builder-buyer disputes within 120 days.
Housing minister Sovon Chatterjee said it would take at least three more months to appoint a regulator and frame rules. Setting up the tribunals may take still more time. For the interim period, however, a high-powered committee will appoint a regulator recommended by the state government. The regulatory authority will also decide various fees. This high-powered panel is likely to comprise the Chief Justice of Calcutta High Court, the judicial secretary and housing secretary.
Several states, including Maharashtra, Tamil Nadu, Karnataka and Uttar Pradesh, have set up the regulatory authority and have a number of housing projects registered under the Act. Already 21 states have notified the RERA rules and 13 have active online portals.
The notification of HIRA formalizes the confirmation with RERA, a central Act supposed to bring in transparency and reliability in the housing sector. Now, all housing projects above 500 sq m or eight apartments need to be registered with the state regulator.
The Bengal chapter of the Confederation of Real Estate Developers Association of India (Credai-Bengal), the umbrella body of builders in the state, welcomed the notification and hoped the process would now be expedited as the state was way behind others in compliance. “We hope a regulator is soon appointed as per law,” said Credai-Bengal president Nandu Belani. The real estate community is anxious about an early rollout of HIRA as it believes this will boost customer confidence and revive the industry that has seen sales stagnate since 2012-13. Demonetisation and GST in 2016 and 2017 dealt further blows, leaving the industry battered.
“Amidst the bumps, it is RERA that has emerged as a silver lining in states where it has been enforced, ushering in transparency and weeding out malpractices,” said Credai-National vice-president Sushil Mohta.
Instituting the state’s real estate regulatory authority is key to fixing regulations and fees, ensuring compliance, conducting investigations and imposing penalties. The authority’s website will contain records of registered real estate projects, as well as those that have defaulted.
Once HIRA is implemented, projects and developments will become more transparent, promoters will have to disclose the carpet area of apartments instead of quoting the super-built area and a grievance redress system will be in place. Developers will also not be able to siphon funds from one project to another.
HIRA’s enactment on August 16, 2017, had missed the July 31 deadline. Housing minister Sovan Chatterjee had then committed that HIRA would be in place within 60 days. But with the notification taking more than nine months, real estate industry observers said it might take several months more before home buyers here could avail of the benefits of HIRA.