NEW DELHI: Realty major DLF Chairman K P Singh has said there are some "serious anomalies" in the real estate regulatory law, such as no provision for single-window approval system, which pose a grave concern for the developers and can stifle growth, like in 1960-70s.
Addressing the shareholders at the company's AGM yesterday, Singh also said the passage of the Real Estate Regulation Act (RERA) is a classic instance of a reform legislation that reflects the government's sincerity and commitment to bring about greater transparency in the real estate sector.
"However, while the intention is laudable, and RERA, will indeed be a game changer, there are some serious anomalies in the actual provisions of the new legislation which in my view pose certain grave concerns for developers and other risk- taking players in the real estate business," Singh was quoted as saying in a copy of the speech uploaded on BSE today.
Listing some concerns, Singh said there is no provision for single-window clearance of approvals, which is the single-most important requirement to cut red tape and delays.
"There is no clarity on the distinction between Occupancy Certificates and Completion Certificate; Unless land rates are based on books of accounts all costs incurred prior to starting of projects would not be added," he said.
"Joint venture agreements would be adversely impacted; The stipulation that sanctioned plans must be posted on websites would raise issues of Intellectual Property Rights," he added.
Singh said there are numerous other anomalies in the new law, which are "unmistakably weighted against the interests of developers".
However, he listed just a few of them in hope that the states would incorporate appropriate amendments and vitally required corrections at the time of framing of rules.
"Unless this is done, I am afraid RERA could dampen rather than unleash the entrepreneurial spirit in the real estate development.
"The country can ill-afford a situation akin to the 1960s and 1970s when punitive laws and restrictive policies stifled private sector growth and investment in housing sector and led to the serious mismatch between supply and demand for real estate products which have still not been able to bridge," Singh said.
Real Estate (Regulation and Development) Act, 2016 was passed by Parliament in March and the law came into force from May 1. The law seeks to protect consumers from fly-by-night operators.
This law seeks to establish the Real Estate Regulatory Authority for regulation and promotion of the real estate sector and to ensure sale of properties in an efficient and transparent manner and protect the interest of consumers in the real estate sector.
All real estate projects have to be registered with the real estate regulatory authorities.
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