2. Real Estate ( Regulation and Development) Bill 2013
Right to Fair Compensation & Transparency in Land
Acquisition, Rehabilitation & Resettlement
(Amendment) Bill, 2015
Smart Cities
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3. The Real Estate Regulation and Development Bill, 2013 has been
approved by the Union Cabinet on 4th June of 2013 which is yet to be
approved by the Lok Sabha and the Rajya Sabha.
It is a bill that aims to establishing an oversight mechanism to enforce
accountability of the Real Estate Sector and providing adjudication
machinery for speedy dispute redressal.
The bill provides for the establishment of the Real Estate
Regulatory Authority (“the Authority”) for regulation and
promotion of real estate sector and to ensure sale of plots,
apartments or buildings, as the case may be, in an efficient and
transparent manner and to protect the interest of consumers in
real estate sector and establish the Real Estate Appellate Tribunal
to hear appeals from the decisions, directions or orders of the
Authority.
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4. NDA government has introduced the Bill. BJP government had
made changes to the draft bill, by which it will be applicable
to commercial properties too.
The old draft of the bill is applicable to projects where the
area of the land is 1000 sq. mtrs. and above or where a
building consist of 12 or more flats. However, Modi
Government made the bill applicable to the project where
area of land exceeds 4,000 sq. meters.
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5. Property brokers must
obtain a License
Developers to be submit
authenticated copies of
approvals and sanctions
from the Competent
Authorities while
applying for registration
Developers to maintain a
separate bank account for
each project in a schedule
bank to prevent diversion
of funds from one project
to another
If a provision of the Bill,
he could be jailed or fined
severely
The provisions of this bill
will also apply
government agencies
involved in housing
projects
No advertising, selling or
money raising will be
permitted before project
approvals are in place
Disclosure of mandatory
information by the
developers or estate
agents
Restriction on taking
advance
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6. The Authority will act as a nodal agency to co-ordinate efforts
regarding development of the real estate sector and render necessary
advice to the appropriate Government to ensure the growth and
promotion of a transparent, efficient and competitive real estate
sector.
The authority shall ensure compliance of the obligations cast upon the
promoters and the allottees and to cause an inquiry to be made into
compliance of its orders or directions made in exercise of its powers
To host and maintain a website of records of all real estate projects
within its jurisdiction as database, with all details as provided in the
application for registration under the Act, for projects, for which
registration has either been granted or cancelled as the case may be;
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7. Regulatory Authority shall have the power to call for information,
conduct Investigations, and make inquiry in the affairs of
promoters where it considers expedient so to do it
Regulatory Authority has the power to Issue directions to promoters
and allottees from time to time and such directions are binding on
all concerned.
Powers of the Regulatory Authority consequent upon lapse of or
cancellation of registration of the promoter to recommend to the
Competent Authority to have the remaining development works,
carried out from the proceeds of the enforcement of bank guarantee
and recover charges incurred on the said development works due
from the promoter.
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8. The Regulatory Authority shall have powers to regulate its
own procedure and shall be guided by the principles of
natural justice and shall have all the powers as are vested
in a Civil Court under the Code of Civil Procedure,1908
The Bill give the power to establish one or more Real Estate
Regulatory Authority in each State/UT, or one Authority
for two or more States/ UT, by the Appropriate
Government, specifying their functions, powers, and
responsibilities to exercise oversight of real estate
transactions. The Bill shall also appoint adjudicating
officers to settle disputes between parties, and to impose
penalty and interest.
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9. Any promoter who fails to register in accordance with the provisions of
the Real Estate (Regulation and Development) Bill,2013 shall be
punishable with imprisonment for a term which may extend to three
years, or a penalty which may extend to ten per cent of the estimated cost
of the real estate project, or with both.
If any promoter contravenes any other provisions of this bill, other than
that provided above, or the Rules or Regulations made , he shall be liable to
a penalty which may extend to five percent of the estimated cost of the real
estate project.
Any promoter who wilfully fails to comply with orders of the Authority
shall be liable to a minimum penalty of one lakh rupees for every day
during which such default continues, which may extend to five percent of
the estimated cost of the real estate project.
Any promoter who wilfully fails to comply with the orders of Appellate
Tribunal shall be punishable with imprisonment for a term which may
extend to one year or with a penalty which may extend to ten percent of
the estimated cost of the real estate project, or with both.
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10. Although the bill is in the interest of the consumers
which will bring transparency and a proper grievance
system for the dispute management and also they will get
their apartments/ units booked on the prescribed time as
promised by the Developer(s)/ Builder(s) .
The consumer can approach the Regulatory Authority for
any dispute as to the violation of the any of the terms and
conditions by the developer(s)/ builder(s).
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11. But it will affect the Developers and Builders very
much as
a. Small developers that the increased disclosure
requirements may add to their costs.
b. The Bill does not address concerns faced by property
developers in obtaining permits and approvals.
c. Cannot divert the money of one project to the other
project till the time of completion.
d. Advertisement will be done only after the necessary
approval is taken from respective authorities.
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13. The Right to Fair Compensation and Transparency in Land
Acquisition, Rehabilitation and Resettlement (Amendment)
Bill, 2015 was introduced in the Lok Sabha by the Minister
for Rural Development, Mr. Birender Singh on February 24,
2015. The Bill amends the Right to Fair Compensation and
Transparency in Land Acquisition, Rehabilitation and
Resettlement Act, 2013 (LARR Act, 2013).
The Bill replaces the Right to Fair Compensation and
Transparency in Land Acquisition, Rehabilitation and
Resettlement (Amendment) Ordinance, 2014.
The bill is now pending at Rajya Sabha.
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14. The Bill provides for land acquisition as well as rehabilitation and
resettlement. It replaces the Land Acquisition Act, 1894.
The process for land acquisition involves a Social Impact Assessment
survey, preliminary notification stating the intent for acquisition, a
declaration of acquisition, and compensation to be given by a certain
time. All acquisitions require rehabilitation and resettlement to be
provided to the people affected by the acquisition.
Compensation for the owners of the acquired land shall be four times the
market value in case of rural areas and twice in case of urban areas
In case of acquisition of land for use by private companies or public private
partnerships, consent of 80 per cent of the displaced people will be
required. Purchase of large pieces of land by private companies will require
provision of rehabilitation and resettlement.
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15. It is not clear whether Parliament has jurisdiction to impose rehabilitation and
resettlement requirements on private purchase of agricultural land..
The requirement of a Social Impact Assessment for every acquisition without a
minimum threshold may delay the implementation of certain government
programmes.
Projects involving land acquisition and undertaken by private companies or
public private partnerships require the consent of 80 per cent of the people
affected. However, no such consent is required in case of PSUs.
The market value is based on recent reported transactions. This value is doubled
in rural areas to arrive at the compensation amount. This method may not lead to
an accurate adjustment for the possible underreporting of prices in land
transactions.
The government can temporarily acquire land for a maximum period of three
years. There is no provision for rehabilitation and resettlement in such cases. 15
17. Change(s) to the definition:
a. The bill substitute the words “private company”
wherever they occur with the words “private entity.”
b. The Bill amends the Act to include acquisition of
land for private hospitals and private educational
institutions within the definition of public purpose. ƒ
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18. Changes to five categories of exempted projects:
a. The Bill allows the government to exempt five categories of projects from:
(i) Social Impact Assessment, (ii) limits on acquisition of irrigated multi-
cropped land, through a notification, and (iii) consent provisions. These
five categories are: (i) defence, (ii) rural infrastructure, (iii) affordable
housing, (iv) industrial corridors, and (v) infrastructure and social
infrastructure. The amendments make the following changes to this
provision: ƒ
b. Industrial corridors: The amendments clarify that land acquired for
industrial corridors will be for industrial corridors set up by the
government and government undertakings. Further, land can be acquired
up to 1 km on both sides of the designated railway line or road of the
industrial corridor. ƒ
c. Social infrastructure: The amendments remove social infrastructure as an
exempted category.
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19. Changes to SIA and limits on irrigated multi-cropped
land:
a. The Bill allows the government to exempt the said five
categories of projects from SIA and limits on irrigated
land, through a notification. The amendment adds that
before issuing this notification, the government must
ensure that the extent of land being acquired is in
keeping with the minimum land required for such a
project.
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20. Survey of wasteland:
a. The amendments add that the government must conduct a survey of its
wasteland including arid land, and maintain a record containing details
of such land, as may be prescribed by the government.
Changes to rehabilitation and resettlement:
a. Under the Act, the rehabilitation and resettlement award for each
affected family includes employment for at least one member of the
family. ƒ
b. The amendments change this provision to ensure compulsory
employment to at least one member of such an ‘affected family of a farm
labourer’.
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21. Changes to Land Acquisition, Rehabilitation and Resettlement Authority:
a. The Act provides for the establishment of a Land Acquisition, Rehabilitation
and Resettlement (LARR) Authority which may be approached in case a
person is not satisfied with an award under the Act.
b. The amendments state that the LARR Authority must hold its hearing in the
district where the land acquisition is taking place, after receiving a
reference from the Collector and giving notice of this reference to all
concerned parties.
Offences by government employees:
a. The Bill states that if an offence is committed by a government employee he
cannot be prosecuted without the prior sanction of the government, as
provided in Section 197 of the Code of Criminal Procedure, 1973.
b. The amendments state that the government employee can be prosecuted if
procedure laid down in Section 197 of the Code of Criminal Procedure,
1973 is followed. Section 197 requires the prior sanction of the government
prior to prosecuting a public servant.
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22. Changes to application of 2013 Act:
a. The Land Acquisition Act, 1894 will continue to apply in certain cases,
when an award has been made under it. The 2013 Act will apply in case
an award has been made five years prior to the commencement of the
2013 Act but the physical possession of the land has not been taken or
compensation has not been paid.
b. The Bill states that in calculating the five year time period, any period
where possession of land was taken but the compensation is lying
deposited in a court or any account, will not be counted. The
amendments change ‘account’ to ‘designated account’.
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24. A developed urban area that create sustainable
economic development & high quality of life by
excelling in multiple key areas; Economic, Mobility,
environment, people, living & Govt. excelling in these
key areas can be done so through strong human
capital, social capital and/ or ICT infrastructure
Smartness in a city means different things to different
people. It could be smart design, smart utilities, smart
housing, smart mobility, smart technology etc. Thus it
is rather difficult to give a definition of a smart city.
However, people migrate to cities primarily in search
of employment and economic activities beside better
quality of life. Therefore, a Smart City for its
sustainability needs to offer economic activities and
employment opportunities to a wide section of its
residents, regardless of their level of education, skills or
income levels.
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26. The Narendra Modi government is set to substantially ease
norms for foreign investment in the construction sector,
hoping to drum up interest in the prime minister's plans for
100 smart cities as well his affordable housing initiative.
Therefore, in the 2014-15 Budget Session, the Finance
Minister of India Mr. Arun Jaitely has allotted 7,060 Crores
of Rupees for the 100 Smart Cities. The Indian Prime
Minister Mr. Narendra Modi is going to develop the 100
Smart Cities as Satellite Towns of Larger Cities by
modernizing the present Cities.
The government is seriously considering removal of all
restrictions on size and minimum capitalization for the
smart cities as well as affordable housing projects.
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27. Developers will be exempted from restrictions related to
minimum capitalization and exits if they commit 30% of the
project cost to affordable housing.
The thrust will be on affordable housing and smart cities. The
proposal is that, they will be exempted from the
conditionalities to attract more foreign investment.
There is a need to channelize investments in the affordable
housing segment, said a government official aware of the
development.
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28. The minimum built-up area has been proposed to be cut to
20,000 sq meters from 50,000 sq meter while the minimum
capitalization requirement will be halved to $5 million from
$10 million.
The government hopes the easier rules will also help in the
faster completion of projects delayed by a squeeze on funds
because of elevated debt levels.
"The (Cabinet) note is more or less finalized," the official
added. The government is planning to set up 100 smart cities
across the country that will provide modern amenities,
education and employment opportunities.
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29. The sector attracted $1.2 billion in FDI in 2013-14, down 8%
from 2012-13. Investors would likely be able to exit projects
on receipt of occupancy and/or completion certificates issued
by the competent local authority or after FIPB's nod.“
It is being discussed to do away with the minimum lock-in
period of three years after the completion of the project.
A developer should be allowed to exit immediately after
completing it. This will also create an incentive for faster
completion of projects.
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30. The issue related to agricultural land will be dealt
with at the state level. The BJP government is on a
foreign investment liberalization drive.
It increased the FDI cap in defence to 49% from 26%
and allowed 100% FDI in railway infrastructure
while partially opening up railway operations.
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31. The government will give concessions to smart cities
to make it attractive for foreign investors.
Easing of norms has generated high interest levels
from not just the foreign investors but also domestic
players.
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