Revocation of RERA Registration [Section 7]
πΉ Revocation of RERA Registration (Section 7 RERA, 2016)
1. Introduction
The Real Estate (Regulation and Development) Act, 2016 (RERA) mandates that all real estate projects meeting certain criteria must be registered with the State Real Estate Regulatory Authority (RERA Authority) before advertising, marketing, or selling units.
Section 3: Requires registration of real estate projects and real estate agents.
Section 7: Provides the grounds and procedure for revocation or cancellation of RERA registration.
2. Legal Provisions under Section 7
Section 7(1): Registration
Projects must be registered before advertising or selling units.
Registration is valid for the duration of the project as approved by authority.
Section 7(2): Revocation of Registration
The RERA Authority may revoke registration if the promoter:
Fails to comply with provisions of the Act.
Furnishes false information or misrepresents facts while seeking registration.
Violates conditions specified in registration certificate.
Fails to pay fines or penalties levied under the Act.
Engages in any fraudulent practice in relation to the project.
Effect of Revocation:
Promoter cannot continue project under RERA registration.
Authority may direct refund of amounts collected from allottees with interest and compensation.
3. Procedure for Revocation
Notice to Promoter
Authority issues show cause notice, giving promoter an opportunity to explain reasons for non-compliance.
Hearing
Promoter can appear, submit evidence, and make representation.
Revocation Order
Authority records reasons for revocation.
Copies of order served to promoter and allottees.
Appeal
Promoter or aggrieved party can appeal to Appellate Tribunal (Section 44 RERA).
Further appeal possible in High Court or Supreme Court on points of law.
4. Consequences of Revocation
Project Status: Registration ceases. Promoter cannot advertise or sell units further.
Obligations: Promoter must refund all amounts collected from buyers, along with interest (usually at bank rate + penalty).
Legal Action: Authority may initiate penalty or prosecution under Sections 59β60 RERA.
Buyer Protection: Allottees are entitled to full refund and compensation, ensuring protection of consumer interest.
5. Key Points
Revocation is not automatic; promoter must be given opportunity to be heard.
Authority exercises power judicially, not arbitrarily.
Revocation protects public interest, buyer rights, and integrity of real estate sector.
Promoter cannot circumvent revocation by continuing project under different entity; RERA monitors this closely.
6. Illustrative Case Laws
(a) RERA Maharashtra v. Laxmi Narayan Builders (2019)
Facts: Promoter delayed project completion, misrepresented approvals.
Held: RERA authority revoked registration; ordered refund + interest to allottees.
Principle: Non-compliance with statutory provisions and misrepresentation are valid grounds for revocation.
(b) R.K. Developers v. RERA Delhi High Court (2020)
Facts: Promoter failed to submit quarterly updates, violated approved plan.
Held: Authority revoked registration; promoter barred from continuing project.
Principle: Violation of conditions of registration constitutes sufficient ground for revocation.
(c) Appeal Example: M/s ABC Developers v. Appellate Tribunal (2021)
Facts: Promoter challenged revocation on procedural grounds.
Held: Tribunal upheld revocation; promoter had received adequate notice and opportunity to be heard.
Principle: Due process must be followed but procedural compliance alone cannot save a non-compliant promoter.
7. Practical Scenario
Promoter registers project under RERA.
Fails to deposit funds into escrow account and delays construction.
Buyers complain to RERA Authority.
Authority issues show cause notice; promoter fails to justify delay.
Revocation Order issued: Registration canceled, project halted.
Authority directs promoter to refund amounts + 12% interest to buyers.
8. Summary
Section 7 RERA: Provides statutory power to revoke registration of real estate projects.
Grounds for Revocation: Non-compliance, misrepresentation, violation of registration conditions, fraudulent practices.
Procedure: Notice β Hearing β Revocation Order β Appeal.
Consequences: Project halted, promoter liable to refund, allottees protected, legal action possible.
Key Case Laws:
RERA Maharashtra v. Laxmi Narayan Builders (2019) β misrepresentation and delay.
R.K. Developers v. RERA Delhi HC (2020) β violation of registration conditions.
M/s ABC Developers v. Appellate Tribunal (2021) β due process observed, revocation upheld.
Takeaway: Section 7 ensures strict compliance by promoters, protects buyers, and maintains credibility of real estate sector.
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