Noida: UP-Rera to crack down on handover of incomplete flats

The directive, issued under Section 37 of the Rera Act, 2016, aims to protect new buyers from being forced to accept bare-shell flats

The Uttar Pradesh Real Estate Regulatory Authority (UP-Rera) has directed all developers to immediately stop handing over incomplete apartments to homebuyers, cracking down on errant builders, officials said. The order, issued on May 8, clearly reiterates the law that possession can only be offered after full completion of the apartment, all promised amenities are in place, and a registered sale or lease deed has been executed, they added.

Buyers being forced to accept bare-shell flats is a practice that UP-Rera has deemed both illegal and a serious violation of the law. (HT Archive)

The directive, issued under Section 37 of the Rera Act, 2016, aims to protect new buyers from being forced to accept bare-shell flats, a practice that UP-Rera has deemed both illegal and a serious violation of the law.

“The promoters found violating these rules can be fined up to 5% of the total project cost under Sections 38 and 61 of the Rera Act,” said Mahendra Verma, secretary, UP-Rera.

To be sure, Uttar Pradesh building bylaws states that a developer must secure multiple no-objection certificates — including fire safety, dues clearance, and provisions for parks, lifts, pools, and other common services — before applying for an OC.Once all parameters are met, the Noida Authority inspects the site. Only after OC is granted can possession be legally handed over. Without an OC, giving possession is illegal, officials said.

The authority said physical possession of an apartment can only be transferred after the builder obtains a completion or occupancy certificate from the competent authority. Further, developers must execute a legally registered agreement before demanding more than 10% of the property cost, officials added.

The order defines “ready-to-move-in” units as those where all internal works — flooring, plumbing, electrical connections, fire safety, doors, windows, and other finishes — are complete and in accordance with what is promised in the brochure and sanctioned plan. According to Rule 1.8(3) of the UP Agreement for Sale Rules, 2018, the price quoted must include land cost, construction charges, development fees, and committed amenities — any deviation is considered default.

“The developers must deliver the apartments once they complete the facilities as per the promises made in the builder-buyer agreement, and also they must fulfil all legal formalities because it is related with safety too,” said Dinesh Gupta, secretary of the Confederation of the Real Estate Developers Association of India (Credai).

UPRera’s directive has been welcomed by homebuyer groups, while developers have raised concerns about increasing compliance demands, especially in projects where utility connections or final clearances cause delays. “Many developers citing the financial crisis have given possession to incomplete housing projects without obtaining a mandatory occupancy certificate. As a result, the flat buyer suffers as he is made to live without basic amenities in the society,” said Madhvi Singh, a homebuyer at Supertech Romano, Sector 118.

In a related move, the Noida, Greater Noida, and Yamuna Expressway industrial development authorities have made it mandatory to pay stamp duty upfront at the time of booking in all new housing projects, further tightening procedural norms for developers.