States object to Centre plan for realty regulator

Latest version of draft Bill allows a state to have more than one regulator and at the same time.

Written by Smita Aggarwal | New Delhi | Published:June 17, 2012 9:47 pm

The Centre’s attempts to regulate the realty sector to curb black money flows seems to be heading into rough weather with several states opposing the proposal.

Chhattisgarh,Madhya Pradesh and Maharashtra have objected to the proposed watchdog on the grounds that they plan to draft their own legislations. Tamil Nadu and West Bengal have not even sent their responses on the draft legislation floated by the Centre.

“We have assured states that they can draft their own version of the Bill as long as it is not inferior to the central Bill,” a senior government official told The Indian Express. In fact,the clause was included in the draft Bill only after these states,led by Maharashtra,objected to the Centre’s attempt to regulate the sector.

“We also clarified to the states that the central legislation would not get into matters related to land or housing which are in the State List,” the official said. The proposed Bill restricts itself to regulating transactions between promoters or builders and buyers.

Sources in the housing and urban poverty alleviation ministry said they had been in dialogue with the West Bengal and Tamil Nadu governments over the past seven-eight months. Meanwhile,the Centre has turned down a proposal by state governments including Delhi to exclude state development boards or housing authorities from the regulator’s scope.

Ministry officials said the draft Bill may be taken up by the Cabinet in the monsoon session after it receives the responses of Tamil Nadu and West Bengal.

The passage of the proposed Real Estate (Regulation and Development) Bill,2011 has been delayed by over a year,when its scope was changed from being a model draft Bill to a central legislation. While seeking to bring in transparency and accountability in the housing sector,the Bill has provisions to penalise errant builders.

The latest version of the draft Bill allows a state to have more than one regulator and at the same time,two or more states to have one regulator.

“In case of Uttar Pradesh,the state may like to have more than one regulator going by its sheer size,and the fact that the number of transactions or registrations may be very large. On the other hand,north-eastern states may like to have a single regulator,” the official said.

The draft Bill proposes a minimum built-up area of 1,000 sq m,which was revised from the 4,000 sq m earlier,bringing more projects under the regulator’s scope. Apart from a regulator in each state,the Bill proposes an appellate tribunal at the Centre to resolve disputes.

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