Q 1.) Does marketing and branding costs not include in
the cost of the project?
Ans. - Sec 2 (v) of the
RERA Act 2016 defined “Estimated cost of real estate project” means the total the cost involved in developing the real estate project and includes the land cost,
taxes, cess, development, and other charges.
The estimated cost of real estate project =
Land Cost + development Cost
Development cost = Construction Cost +
Other Costs
Further respective RERA Rules has defined - The cost of construction shall include all such costs,
incurred by the promoter towards on-site and off-site expenditure for the development
of the real estate project including payment of Taxes, Fees, charges, premiums,
interests, etc., to any competent authority, or statutory authority of the
Central or State Government, including interest, paid or payable to any
Financial Institutions including scheduled banks or non – banking financial
companies etc.
By Reading of definitions, it is understood that the Estimated cost of a real estate project is the
Cost for the development of the Project. Generally, Sales and marketing costs
related to Sales Expenses. Hence Sales and marketing costs shall not be
included to arrive at the Estimated cost of the
real estate project and also shall not be considered as incurred while the
issuance of CA certificate for withdrawal of funds from the project Bank
Account-based on a percentage of completion of the project.
Q 2.) How to take the cost of land in case of dagpa
(Joint Development) ?
Ans. - RERA Act does not differentiate between whether
the weather project is developed on own land or a third party (landowner). RERA
Act mandates the registration of the Real Estate Project and not the promoter
share in the Real Estate Project.
The State rules has defined the Cost of Land - the costs incurred by the promoter for acquisition
of ownership and title of the land parcels for the real estate project as an
outright purchase lease etc., or the Guidance Value in accordance with section
45-B of the Karnataka Stamp Act 1957 relevant on the date of registration of
the real estate project whichever is higher.
Hence promoters shall consider the Cost
of Land - higher of purchase price or Guidance value as on date of application
for grant of RERA Registration irrespective of own land or joint development.
Q 3.) Will Income Tax be a part of the cost of the
project?
Ans. Since this is not a tax paid for the development of the
project, but it is paid as a result of the profit derived on development of the
real estate project.
Q 4.) What is the purpose of mentioning the cost
belonging to the owner when it is a Joint Development
Agreement?
Ans. - RERA Act does not differentiate between whether
the project is developed on own land or third party land (land owner). RERA Act
mandates the registration of the Real Estate Project and not the promoter share
in the Real Estate Project. Hence, cost of the land for the purpose of
registration of Real Estate Project shall be mentioned in the application for
grant of registration.
In case of JDA, both the Promoter and LandOwner are
deemed to be promoters and jointly liable to comply with the requirements under
RERA and most of the Authorities have issued circular clarifying this and
require a single designated Bank Account to be opened and 70 % of the money
collected to be deposited into the same account.
Q 5.) Do landowners require separate registration Under
RERA?
Ans. - Project shall be registered as 1 (Developer +
landowner) share. RERA Act mandates the registration of the Real Estate Project
and not the promoter share in the Real Estate Project.
Q 6.) Is it possible to change the estimated cost of
construction later on once registration is
done?
Ans. - To change the estimated cost Promoter shall make
an application, giving an explanation as to the reason for the change in the
cost along with supporting documents substantiating such change in the estimated cost of construction.
Q 7.) Can we get a Certificate
Formats?
Ans. - Certificate formats are available to be downloaded
on the website of all Authorities.
Q.8.) How to show sold units in commercial units whereas
the plan is for the entire floor. later sold at small units on the floor?
Ans. Generally, the Number of units or inventory in the
project shall be declared in the application for grant of registration along
with the Carpet Area in Square meter. Square meters could be the measurement of
sold and unsold in commercial projects if the promoter does not have a standard
number of units.
Q 9.) The reader of the certificate is the
Statutory authority?
Ans. - The certificates are presently only available for
the Authority's scrutiny, however, it may become available to the public soon
and is amenable to an Allottee under RTI.
Q 10.) Is there any time limit for Post
Registration compliance?
Ans. - The Post-registration update would have to be
completed before the first Quarterly update, otherwise the Quarterly update can
not be done. There are not as such guidelines for Post Registration, however,
we recommend as soon as you obtain the registration.
Q 11.) - A flat is sold at 60 Lacs. However, the promoter
has agreed to pay EMIs for 1 year amounting to 4.8 Lacs. What is the amount to
be reported in RERA as sales?
Ans. - Amount realized from the allottee is Rs.60 Lacs in
terms of the agreement. hence the same shall be mentioned in the certificate.
EMI paid is as expenses to the promoter and not related to the consideration
towards the unit.
Q 12.) - My RERA application was approved on 31.03.2021,
Should I file for the quarter from January to March 2021?
Ans. - Yes, as the approval date falls within the quarter
date. Quarterly filing for March 2021 is applicable (for Karnataka projects).
Q 13.) - Is there any way to change the architect,
engineer or contractor details once the registration is done under
RERA?
Ans. – Promoters need to inform the RERA Authority
in order to change the architect, engineer, or contractor details and also
obtain NOC from the previous professional. The format of the Engineer
Certificate notified by the Authority has mentioned that the promoter shall not
change the engineer without taking approval of the Authority.
Q 14.) - The due date for Q4 quarterly updates is 15 days
from the end of the quarter. The due date for the Annual report is 6 months
from the end of the financial year. So, Is it mandatory to upload the annual
report with the Q4 quarterly updates or can it be done anytime before 30
September?
Ans. – Please refer to State Rules for due dates for
Quarterly updates. Most of the States direct to file 15 days from the end of
each quarter and 30th Sep for Annual accounts.
Q. 15) - RERA completion date for my project was
10/6/2019, but the project is still not completed by the builder. Can the
landowner revoke the Joint Development Agreement with the builder and complete
the remaining work by collecting the amount from flat holders? Can we complete
the cost of the remaining work through the balance with flat
holders?
Ans. - If the Project has been registered under RERA by
the Promoter, The Landowner would have to seek for Transfer of the Project
under Section 15 because Landowner can not simply be taken over.
Q. 16.) - Whether the process is smooth and cost-efficient. After transfer can the landowner do the registration of flats which
were earlier booked by the builder in his share?
sAns. - In our Experience, each real estate project has
unique challenges to address. If the landowner along with the allottees is able
to gather the consent for the scheme of the takeover, it would be faster and cost-effective.
Q. 17.) - How to change the cost of the estimated cost of
the project?
Ans - File a separate application along with an explanation and representation before
the Authority for such correction in estimated
cost of real estate project.
Q. 18.) - How to show sold units in commercial units,
whereas the plan is for the entire floor. Later sold at small units in the
floor in Quantity updates?
Ans. – You can mention sold by the Carpet Area.
Q. 19.) - The agreement is for Rs. 1 crore, the allottee
has paid Rs. 50 lakhs (Rs. 49.5 lakhs to promotor and Rs. 50,000 towards TDS).
In this case, what will be the amount collected from the allottee, whether it
should be Rs. 49.5 lakhs or Rs. 50
lakhs?
Ans. - Rs. 50 lacs as TDS is credited in favour of
Builder.
Q. 20.) - Can the landlord & developer be able to
have multiple RERA accounts for their share?
Ans. – RERA Act mandates project-specific bank accounts.
Only 1 bank is allowed as a project-designated bank. There can not be
different/multiple bank accounts for builders and LO. Refer notification or
circulars issued by the RERA Authorities.
Q 21.) Architect certificate is issued as per the format, it
does not have an overall percentage of completion of the project, what
percentage to be mentioned in CA Certificate?
Ans – Please insist the architect to mention over all % of completion of the
development of the project. Otherwise, the promoter shall provide it. CA should
mention the fact of % of completion as per Architect in his certificate while
issuing the certificate for withdrawal of funds in accordance with Sec
4(2)(L)(D) of the Act.
Q. 22.) Do we have to open a collection account; 70%
&30% or only a designated account is enough for plots
project?
Ans. - Act says bank account in a scheduled bank account
- even 1 bank account is sufficient - Many banks have come out with separate
products for the RERA project having 3 different accounts (Master Collection
Account + 70 % Account + 30% Account). For the purpose of RERA, promoters shall
provide a 70 % Account during Registration.
Q. 23.) Whose percentage to be considered for withdrawal
from the bank. Architect, Engineer, or CA?
Ans. - Architects issue the % of Completion of
development of the Project. Based on the Architects certificate, CA calculates
the amount eligible for withdrawal of funds from the project Designated Bank
Account.
RERA Consultants LLP,
Contact Us: 9535578604/ 8296807004
No comments:
Post a Comment