1,000 Builders’ Accounts Frozen by GujRERA for Non-Compliance
1,000 Builders’ Accounts Frozen by GujRERA for Non-Compliance
Developers Fail to Meet Quarterly Compliance Requirements, Face Penalties and Restrictions
In a sweeping enforcement action, the Gujarat Real Estate Regulatory Authority (GujRERA) has frozen the bank accounts of approximately 1,000 real estate developers. The move comes as a consequence of failing to comply with quarter-end compliance (QEC) requirements.
This move marks a significant crackdown by GujRERA, enforcing penalties against developers. These builders have not submitted the progress reports or seeked extensions for incomplete projects as mandated under RERA regulations.
GujRERA is empowered to penalize non-compliance. Following hearings has barred developers with frozen accounts from accessing funds until their projects receive GujRERA’s approval. Additionally, developers whose project registrations have lapsed are prohibited from booking unsold units. Any proceeds from bookings during this freeze period must be deposited into a dedicated RERA account via cheque.
There are approximately 15,000 registered projects in Gujarat. GujRERA initiated this enforcement action two weeks ago. Meanwhile, 250 developers have achieved compliance, while others are still working to complete their paperwork to unfreeze their accounts.
Sources familiar with the situation report that affected developers are urgently seeking assistance from chartered accountants and navigating the compliance procedures. Simultaneously, developers who have not yet faced action are rushing to apply for extensions to avoid similar penalties.
The QEC requirements are integral to the RERA framework, ensuring that projects adhere to their proposed schedules. However, many developers neglected to report project completion or seek extensions, prompting GujRERA to instruct the State Level Banking Committee (SLBC) to freeze their accounts.
According to a senior GujRERA source, “Under the RERA Act and rules, developers must provide commencement and completion dates when registering construction projects with RERA. They are obligated to inform RERA upon project completion, obtaining BU permission and forming the Resident Welfare Association (RWA). If a project is not completed by the due date, developers must seek an extension.”
This enforcement action comes as GujRERA’s commitment to uphold transparency and accountability in the real estate sector. It aims to protect homebuyers and ensure timely project completions.
