Bhubaneswar, Feb. 23: Property buyers will have a forum to redress their grievance with the state government today announcing the formation of a regulatory authority and an appellate tribunal to regulate the real estate sector under the Real Estate (Regulation and Development) Act, 2016.

Urban development minister Pushpendra Singh Deo told the Assembly today that in keeping with the central act, the Real Estate Regulatory Authority and the Real Estate Appellate Tribunal would be formed in the state. Yesterday, the state cabinet had approved the proposal to implement the act in the state.

The formation of the regulatory authority would help homebuyers lodge grievances against any real-estate agency, while the tribunal will facilitate resolving such complaints.

While a senior administrative official of the rank of an additional secretary will head the authority, the tribunal will have as its head a retired chief justice of the high court. The authority will also have two experts to look into the disputes.

Deo said a three-member committee consisting of the chief secretary and two principal secretaries of the law and the housing and urban development departments would select the head of the authority. "The act will bring transparency in property transactions," the minister said.

The act stipulates that all residential and commercial real estate properties constructed over a minimum area of 500sqm or apartments with more than eight flats would have to be registered under the authority. Moreover, the ongoing projects that have not received completion certificate on the date of commencement of the act would have to register within three months.

The act says the application for registration of properties will be approved or rejected by the authority within a mandatory period of 30 days from the date of application. On successful registration, the promoter of the project will be provided a registration number, a login ID and a password to fill up essential details on the website of the authority - failing which will invite a penalty of up to 10 per cent of the project cost or three years imprisonment.

Sale and purchase of property without registration will attract jail term and fine. Registration for sale and purchase of properties has been made mandatory. A real estate developer cannot charge more than 10 per cent of the project cost from the customer before providing the sale agreement.

Singh Deo said: "A real estate developer will have to disclose his financial credibility such as PAN card and annual report of details, including disclosure of projects. The disclosure of projects include open areas, parking space and details pertaining to completion certificates, status of projects, extent of project completion, amount of money collected from the allottees, size of apartment and carpet area. A developer will have to give the time frame for completion of the project." Failure on the part of a real estate agent will invite penal action.

Bhubaneswar Development Authority vice-chairman Krishan Kumar said the act would definitely help buyers in many ways. "There are good provisions in the act that will help property buyers and also keep a check on the monopoly of real estate developers," said Kumar.

Real estate developers have welcomed the step. "It was known that the act will come into force and we welcome the move of the government. However, the government should have consulted us before enacting the rules," said Association for Real Estate Developers president Umesh Pattnaik.

"Implementation of the act is a good move. It would help in the buying of properties in a transparent manner. The irregularities will be checked," said Patia resident Sitaram Mishra.

Incidentally, Odisha became the fifth state in the country to enforce the central act after Gujarat, Madhya Pradesh, Kerala and Uttar Pradesh.