The Confederation of Real Estate Developers’ Associations of India (Credai) said the proposed real estate regulatory Bill would only increase corruption.
Credai represents 8,800 developers through 20 States and 114 city chapters across the country.
The Bill is expected to come up in the current session of Parliament.
The sweeping powers sought to be vested with the regulatory authority would only increase corruption manifold, instead of curbing it, said Lalit Kumar Jain, National President of Credai.
This may serve political interests of the powers that be, but does not solve the home buyers’ issue of making housing affordable, he said.
For instance, he said, the authority seeks to grant registrations manually and even empowers the regulator to reject them. It also gives discriminatory powers to the authority to cancel registrations. “This is dangerous and will lead to greasing the palms and all such cost is bound to be passed onto the end-buyer,” Jain alleged.
The best way is to strengthen the consumer redressal forum by adding a chapter on real estate and empowering it, he said.
“Credai wants a true regulator which will govern all the stakeholders and have powers to ensure that no delays occur due to other stakeholders like the planning authority,” he said.
There are provisions to penalise developers under CrPC (code of criminal procedure), though economic offences do not invite such draconian legal action, he said.
The Bill also provides for depositing 70 per cent of the sale price in a bank account by developers. Blocking such a large amount will hamper their liquidity and business expansion, he said.
Stating that the real estate and construction industry is the country’s largest employer after agriculture, Jain said the regulatory provisions will create a fear psychosis and also discourage entrepreneurs from entering the business.