In exercise of the powers conferred on the Haryana
Real Estate Regulatory Authority, Gurugram under section 85(1) of the Real
Estate (Regulation and Development) Act, 2016 read with section 34(f) of the
Real Estate (Regulation and Development) Act, 2016 and all others powers
enabling it in that behalf, the Haryana Real Estate Regulatory Authority, Gurugram
having considered it necessary to provide for a mechanism to ensure compliance
of the obligation cast upon the promoters and real estate agents to
sell/facilitate sale of Apartments/Floors in a real estate project on the basis
of carpet area; hereby makes the Haryana Real Estate Regulatory Authority,
Gurugram, (Sale of Apartments/Floors in a Real Estate Project on the Basis of
Carpet Area) Regulations, 2021 as under: (i) These Regulations may be called
the Haryana Real Estate Regulatory Authority, Gurugram (Sale of
Apartments/Floors in a Real Estate Project on the basis of Carpet Area)
Regulations, 2021. (ii) The Real Estate (Regulation and
Development) Act, 2016 read with the Haryana Real Estate (Regulation and
Development) Rules, 2017 have come into force and are being implemented by the
Haryana Real Estate Regulatory Authority, Gurugram for regulation and promotion
of the real estate sector and to ensure sale of plot, apartment or building, as
the case may be, or sale of real estate project, in an efficient and
transparent manner and to protect the interest of consumers in the real estate
sector and to establish an adjudicating mechanism for speedy dispute redressal
of the grievance received by it from time to time. The Real Estate (Regulation
and Development) Act, 2016 intends sale of Apartments/Floors in a real estate
project on carpet area basis as has been defined in section 2(k) of the Act
ibid. The definition of super area as provided in various builder-buyer
agreements is vague and there are vide wide variations in the definition. The
property is not properly described by way of mentioning super area without
specifically giving details and breakup of the components included in the super
area. The practice of sale of real estate on super area basis is illegal,
misleading, ambiguous, opaque, and gives rise to confusion and complexities and
at times result into avoidable litigation. So, keeping in view the purpose and intention of
the Real Estate (Regulation and Development) Act, 2016 and the Rules made
thereunder, a need was felt to frame regulations on the abovementioned subject
and accordingly the same have been framed. (iii) The Haryana Real Estate
Regulatory Authority Gurugram (Sale of Apartments/Floors in a Real Estate
Project on the Basis of Carpet Area) Regulations, 2021 shall apply to sale of
all real estate projects falling within the jurisdiction of the Real Estate
Regulatory Authority, Gurugram, as notified by the Government of Haryana vide
notification No. 1/92/2017-1TCP dated 14/12/2017, which comprises entire area
of Gurugram district. (iv) These regulations shall come into
force with effect from the date of notification in the official gazette. (i) "Act" means the Real
Estate (Regulation and Development) Act, 2016. (ii) "Authority" means the
Haryana Real Estate Regulatory Authority, Gurugram established under
sub-section (1) of section 20 of the Act. (iii) "Carpet Area" shall
have the same meaning as assigned to it under section 2(k) of the Act. (iv) "Real Estate Project"
shall have the same meaning as assigned to it under section 2(zn) of the Act. (v) "Unfair Practice/fraudulent
practice/irregularity" for the purpose of these regulations shall have the
same meaning as assigned to it in explanation to section 7(1)(c) and section
10(c) which inter-alia includes an agreement for sale on any other basis (super
area/covered area/sale area or any other nomenclature prevalent in the area)
except on the basis of carpet area. (i) Before Real Estate (Regulation
and Development) Act, 2016 there was lack of a legal description for the term
"carpet area". The Real Estate (Regulation and Development) Act, 2016
has provided clear definition of carpet area which now has addressed the
vagueness and uncertainty in this regard. The term carpet area has been
specifically and clearly defined under section 2(k) of the Act ibid. (ii) As per section 2(k) of the Real
Estate (Regulation and Development) Act, 2016; "carpet area" means the net usable floor area of an apartment,
excluding the area covered by the external walls, areas under services shafts,
exclusive balcony or verandah area and exclusive open terrace area, but
includes the area covered by the internal partition walls of the apartment. Explanation. For the purpose of
this clause, the expression "exclusive balcony or verandah area"
means the area of the balcony or verandah, as the case may be, which is
appurtenant to the net usable floor area of an apartment, meant for the
exclusive use of the allottee; and "exclusive open terrace area"
means the area of open terrace which is appurtenant to the net usable floor
area of an apartment, meant for the exclusive use of the allottee; (iii) The definition of carpet area as
provided under section 2(k) of the Act means the net usable floor area.
Following have been excluded from the definition of carpet area: (a) Externals wall; (b) Service shafts; (c) Balcony; (d) Verandah; (e) Open terrace. However, the internal partition walls of the
apartment are not excluded. The definition of carpet area has now been made
transparent and leaves no scope for any ambiguity categorically specifying the
property on carpet area basis. (iv) All walls which are constructed
or provided on the external face of an apartment shall be regarded as
"external wall". (v) All walls or independent columns
constructed or provided within an apartment shall be regarded as "internal
partition wall". (i) A promoter is obligated to
provide complete information under clause (h) of section 4(2) of the Real
Estate (Regulation and Development) Act 2016 about the number, type and carpet
area of the real estate unit for sale in the project along with the area of
exclusive balcony or verandah and open terrace area. (ii) It is mandatory for the
developers of all ongoing projects, to disclose the size of their apartments,
based on carpet area (i.e., the area within four walls). This includes usable
spaces, like kitchen and toilets. This has brought transparency in the salable
area and imparts clarity to the buyer. (i) One of the condition for grant of
registration is that in future any new allotment in ongoing projects or new
projects, the apartment shall be sold only on carpet area basis and not on
super area basis and the rate shall be inclusive of all charges. Therefore,
after coming into force of the Real Estate (Regulation and Development) Act,
2016 no apartment in a real estate project shall be sold on any other basis
except on carpet area basis. If any promoter is found violating this condition,
it shall be considered as a ground for initiating penal proceedings against the
promoter including revocation of registration granted under section 5 of the
Act ibid. (ii) In case of ongoing projects where
the promoter has allotted real estate units on super area basis prior to the
Real Estate (Regulation and Development) Act, 2016, he shall disclose what all
components exactly constituted super area and also whether the super area as
promised in the builder buyer agreement entered into between the allottee and
the promoter actually exist or has been actually delivered to the allottee or
not. This is to prevent any fraud with the allottee when the unit is sold on
super area basis. (iii) No conveyance deed of a real
estate unit shall be registered except on the basis of carpet area. In cases
where the real estate unit was allotted to the allottee prior to the Real
Estate (Regulation and Development) Act, 2016 coming into force, the promoter
shall at the time of registration of the conveyance make disclosure of all the
components constituting the super area, however the conveyance deed shall be
registered only on carpet area basis. (iv) In case of a project which is
exempted from registration under section 3(2) of the Act the promoter shall
disclose to the allottee the size of the apartment based on carpet area even if
sold on any other basis such as super area/super built up area, built up area
etc., which shall not affect the validity of the agreements entered into
between the promoter and the allottee to that extent, but shall only specify
the carpet area of such unit sold on super area basis. (v) Any agreement for sale on any
other basis except on carpet area shall amount to indulgence in unfair trade
practice/fraudulent practice by the promoter and shall attract appropriate
action as per the relevant provisions of the Act. (vi) The real estate agents shall not
facilitate sale or purchase of apartments/floors in a real estate project on
the basis of super area. If any real estate agent is found engaged in such
illegal sale/purchase, he shall be deemed to be engaged in unfair trade
practice and his/her license may be revoked or/and a penalty may be imposed on
him as per provisions of section 65 of the Act ibid. (vii) The allottee shall be rightfully
in seeking details regarding each component comprising the super area and the
same shall be provided to him/her by the promoter or the real estate agent, as
the case may be. (i) The definition of real estate
project as provided under section 2(zn) does not distinguish between a
registered and non-registered real estate project. Section 2(zn) provides that: "real estate project" means the development of a building or a
building consisting of apartments, or converting an existing building or a part
thereof into apartments, or the development of land into plots or apartments,
as the case may be, for the purpose of selling all or some of the said
apartments or plots or building, as the case may be, and includes the common
areas, the development works, all improvements and structures thereon, and all
easement, rights and appurtenances belonging thereto; (ii) Therefore, in conformity to the
definition of real estate project as provided under the Act these regulations
shall be applicable to the following: (a) The real estate projects that are
launched after coming into force of the Real Estate (Regulation and
Development) Act, 2016. (b) The real estate projects launched
before coming into force of the Real Estate (Regulation and Development) Act,
2016 and for which completion certificate is not issued i.e. ongoing projects.
It is reiterated for the sake of clarification that a license lapses on the
completion of the project and not merely on the grant of occupation
certificate. The purpose of occupation certificate is limited to the extent
that the building for which the occupation certificate has been issued is
habitable and possession is offered to the allottees. The project is ongoing
until the completion certificate has been issued by the competent authority. Such ongoing project are obligated under the Real
Estate (Regulation and Development) Act, 2016 to register themselves with the
Haryana Real Estate Regulatory Authority, Gurugram. The promoter has to reveal
the size of the apartment based on carpet area at the time of registration of
projects, even if the apartments were earlier sold on any other basis, such as
super area, super built-up area, built-up area, etc. In case of sold out units of the on-going project
where sales were made on super area basis before coming into force of the Real
Estate (Regulation and Development) Act, 2016 the promoter has to give details
of the super area component wise, as per the definition of super area provided
in the earlier executed builder buyer agreements, for the allotted unit to the
buyer and such description shall form a part of the conveyance deed. (c) The real estate projects which
are exempted from registration as per provisions of section 3(2) of the Real
Estate (Regulation and Development) Act, 2016 as these projects are exempted
from registration only but are within the ambit of the provisions of the Real
Estate (Regulation and Development) Act, 2016. (iii) These regulations shall be
applicable to resale of a real estate unit i.e. apartment/floor in the favor of
subsequent allottee, as the Real Estate (Regulation and Development) Act, 2016
does not distinguish between an allottee and a subsequent allottee. This shall
bring more transparency into the real estate sale. After coming into force of
the Real Estate (Regulation and Development) Act, 2016 the obligations of the
promoter does not end with the conveyance deed as there are certain obligations
dependent upon lapse of certain time period such as structural defect liability
as provided under section 14(3) extends to five years from the date of handing
over of possession and land title defect liability extends to a lifetime. (iv) Further, as provided under
section 13 of the Real Estate (Regulation and Development) Act, 2016 read with
rule 8 of the Haryana Real Estate (Regulation and Development) Rules, 2017 the
promoter shall not accept a sum more than ten percent of the cost of the
apartment without first entering into written agreement for sale and also
registration of the sale agreement. An agreement for sale is an extremely
important document and constitutes the terms and conditions of sale of a
property between the seller and the buyer. (v) In this regard rule 8 of the
Haryana Real Estate (Regulation and Development) Rules, 2017 provides for a
model agreement at annexure A of the Rules. The model agreement in clause 1.2
provides that the total price for the built up unit/apartment for
residential/commercial/industrial/IT/any other usage (as the case may be) along
with parking (if applicable) is calculated based on the carpet area. Block/Building/Tower
No. Rate of
Apartment per square feet. (Carpet area basis) Size of
the apartment (carpet area) Apartment
No. Type Floor Parking(if
applicable) Externals
wall To be
excluded Service
shafts To be
excluded Balcony To be
excluded Verandah To be
excluded Open
terrace To be excluded Total
Price (in rupees) (vi) In case of the ongoing projects
the promoters shall incorporate in the agreements for sale the actual carpet
area of the unit. Any violation of these regulations by the promoter or real estate agent
will have serious implications and penal proceedings shall be initiated against
them. (i) Penalty against the promoter for
non-compliance for these regulations: For any act of violation or
non-compliance of these regulations by the promoter penal proceedings shall be
initiated as per the following provisions of the Real Estate (Regulation and
Development) Act, 2017: (a) The promoter hall be liable for
revocation of registration of real estate project under section 7(1)(c). Where
ever the promoter is found indulging in unfair trade practice/fraudulent
practice of selling the Apartment/Floor in a real estate project on the basis
of super area/covered area/sale area or any other nomenclature except on carpet
area, the Authority may, on receipt of a complaint or suo-motu in this behalf
or on recommendation of the competent authority, revoke the registration
granted under section 5 to the promoter or section 9 to the real estate agent
of the Real Estate (Regulation and Development) Act, 2016 as the case may be. (b) Penal action including imposition
of penalties by the Authority in exercise of its powers under section 34(f) and
section 38 or both. If the promoter contravenes the provisions of these
regulations, he shall be liable under section 61 to a penalty which may extent
upto five percent of the estimated cost of the real estate project as
determined by the Authority. (ii) Penalty against the real estate
agent for non-compliance for these regulations: If any promoter is found
indulging in facilitating sale of a real estate unit i.e. apartment/floor on
any other basis except on carpet area basis it shall be treated as involvement
in unfair trade practice under section 10 of the Real Estate (Regulation and
Development) Act, 2016 and proceedings for revocation of registration of such
errant real estate agent may be initiated as per provisions of section 9(7) of
the Act ibid. (iii) It is clarified here that
regulations 6(ii) and (iii) shall be applicable to all real estate projects,
irrespective of the fact that they are registered/registerable or exempted from
registration. (iv) For providing any false
information regarding sale on the basis of carpet area, the promoter shall be
liable to a penalty which may extend to up to five percent of the estimated
cost of the real estate project, as determined by the Authority. (v) Any sale of real estate project
on any other basis except on carpet area basis after Real Estate (Regulation
and Development) Act, 2016 coming into force may be declared as null and void
by the Authority.HARYANA REAL ESTATE
REGULATORY AUTHORITY, GURUGRAM (SALE OF APARTMENTS/FLOORS IN A REAL ESTATE
PROJECT ON THE BASIS OF CARPET AREA) REGULATIONS, 2021
PREAMBLE