The Odisha Real Estate Regulatory Authority (ORERA) recently imposed penalties on two different real estate developers, each amounting to ₹20 lakh, for violating various provisions of the Odisha Real Estate Regulation and Development Rules, 2017. One developer faced consequences for advertising properties without proper registration, while the other was penalized for neglecting to provide a valid sales agreement to a homebuyer. The authority emphasized the importance of adherence to regulations to protect the interests of homebuyers and maintain transparency within the real estate sector.
Advertising Without Registration
In one instance, ORERA levied a ₹20 lakh fine on a developer for contravening Section 3 of the Act, which explicitly states that developers cannot engage in advertising or pre-launch reservations or sales of properties prior to registering such projects with the regulatory body. The law stipulates a potential fine of up to 10% of the overall project cost for those found to be in violation of this clause. ORERA initiated the case because the developer, whilst having applied for online registration in December 2019 for a project in Rudrapur, Bhubaneswar, had commenced advertising campaigns—both via hoardings and online platforms—without obtaining the necessary registration clearance. The regulator mandated that the developer settle the ₹20 lakh penalty within two months, failing which stricter legal actions would be pursued.
Firm Did Not Issue Sale Agreement
In a separate incident, a real estate firm was fined ₹20 lakh by ORERA for failing to furnish a legally compliant sales agreement to a consumer who had made an advance payment of ₹11 lakh for a property situated near Fire Station Square in Bhubaneswar. Based on the homebuyer's complaint lodged with the authority, the order was issued by ORERA. The timeline of the case reveals that the buyer had procured an Allotment Letter after reserving the property and making the initial payment of ₹11 lakh in December 2017. Although the developer provided a digital document labeled as a sales agreement, the concerned homebuyer deemed the document’s format unsatisfactory. Subsequently, the developer's unresponsiveness to these objections propelled the buyer to lodge a complaint with the regulatory authority.
ORERA in its order said that the developer must pay a fine of 20 lakh within two months. Otherwise strict action would be taken in accordance with the law.
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