New Delhi: Government plans to set up a tough regulator for the real estate sector with provisions for even jail term for the developer for putting out misleading advertisements about projects.
The proposed regulator will also make it mandatory for developers to launch projects only after acquiring all the statutory clearances from relevant authorities, Minister for Housing and Urban Poverty Alleviation Ajay Maken said at the National Editors` Conference here.
He said all relevant clearances for real estate projects would have to be submitted to the regulator and also displayed on a website before starting the construction.
Maken said a proposal for the Real Estate (Regulation and Development) Bill, which seeks to provide a uniform regulatory environment to the sector, will be brought before the Union Cabinet soon.
"We plan to introduce the Bill during the Budget Session of Parliament," he said.
The Bill has certain tough provision to deter builders from putting out misleading advertisements related to the projects carrying photographs of actual site.
Failure to do so for the first time would attract a penalty which may be up to 10 per cent of the project cost and a repeat offence could land the developer in jail, Maken said.
The Bill also has provisions that seek to clearly define a carpet area for an apartment thus barring the developer from making any announcements regarding a "super-duper carpet area", he said.
The proposed Bill also seeks to make it mandatory for a developer to maintain separate bank account for every project to ensure that money raised for a particular task is not diverted elsewhere, Maken said.