Approval for bill to crack down on unscrupulous realtors

Centres plans regulator to keep unscrupulous builders on a leash

In a big relief to home-buyers, who are often duped by fly-by-night realtors, the Union Cabinet on Tuesday cleared the Real Estate (Regulation and Development) Bill. It seeks to establish a regulator that will keep unscrupulous builders on a leash and provides for a jail term to developers who put out misleading advertisements about projects.

A brainchild of Housing and Urban Poverty Alleviation Minister Ajay Maken, the Bill seeks to create a uniform regulatory environment. It will allow builders or developers to sell their projects only after they receive all statutory clearances. Furthermore, developers can launch projects only after getting all statutory clearances. The Cabinet discussed the Bill at its April 2 meeting, but deferred it for further consultations.

The Bill seeks to make it mandatory for a developer to maintain a separate bank account for every project to ensure that the money raised for it is not diverted. It provides for a clear definition of the carpet area and prohibits developers from selling houses or flats on the basis of an ambiguous ‘super area.’ Developers will be barred from collecting money from buyers before receiving all permits to start construction.

All clearances will have to be submitted to the regulator and displayed on a website before construction begins. The measure lays out strict provisions to deter builders or developers from putting misleading advertisements by carrying photographs of an actual site. Failure on the part of a developer to comply with these rules will attract a penalty, which may be up to 10 per cent of the project cost. A repeat offence can land him in jail.

Developers will be required to keep aside 70 per cent or less — as decided by the competent authority — of the buyer’s funds in a separate account to ensure timely completion of projects. The buyers are entitled to full refund, with interest, in case of any delay in the completion of projects. Registration of projects with the regulatory authority is a must. They will not be allowed to take more than 10 per cent in advance payment without a written agreement with buyers.

http://www.thehindu.com/news/national/approval-for-bill-to-crack-down-on-unscrupulous-realtors/article4782163.ece?homepage=true

I thought this info was important for property buyers. As this is applicable for private builders, it should surely go on to touch the government agencies who also announce large projects and do not develop the same for years and years.   -Thanks.

Now, pay TDS on property over Rs 50 lakh

I thought the information was very useful for people who buy and sell properties. It is almost government is chasing citizens in every transaction.  I wish everybody look into this new provision in the IT law.    -Thanks.

 

NEW DELHI: Now, you will now have to deduct tax when you make the payment to the seller if the cost of the immovable property exceeds Rs 50 lakh. The Central Board of Direct Taxes has notified the new provision of tax deducted at source, or TDS, on immovable property.

The Finance Act 2013 had provided that purchaser of an immovable property (other than agricultural land) worth over Rs 50 lakh is required to pay withholding tax at the rate of 1% from the consideration payable to a resident transferor.

The rate at which tax is to be cut is 1%, but it would go up to as high as 20% if the seller does not disclose his permanent account number. The provision will apply even when the property has been financed through a bank loan.

Buyer will have to ensure either he himself or the bank deducts tax before disbursing the loan to the seller. The provision will apply in cases where buyer bought an underconstruction property prior to the provision coming into effect but has to make the balance payment after June One.

The tax deducted is to be paid electronically on the Income-tax Department’s website by filling a form online. If a person does not have the facility to pay tax online, he can take the printout of the duly filled form and make payment on any authorised branch. The income tax authorities have done away with the mandatory requirement of Tax deduction and account number for buyers. The buyer will be able to generate the TDS certificate from I-T department’s website and provide it to the seller. The seller would also be able to see the TDS credit in 26AS statement.

http://economictimes.indiatimes.com/news/economy/finance/now-pay-tds-on-property-over-rs-50-lakh/articleshow/20402356.cms