Parliament adopts Real Estate Bill

The Lok Sabha passed Real Estate (Regulation and Development) Bill, 2015 by voice vote after Urban Development Minister M Venkaiah Naidu’s assurance that all aspects pertaining to interests of buyers-consumers and developers have been taken care and the suggestions made by members during the debate would be duly incorporated in implementation of the Act. 

“The Ultimate purpose of the legislation is to serve the interests of consumers and develop the sector in a regulated and transparent manner”, the Minister said. 

After the Minister’s reply the House passed the Bill by voice vote. Prior to this the House rejected amendments proposed by Members. Many Members did not move their amendments following Minister’s assurance that their points would be take care of. 

Even during the debate over the Bill, most of the Members favoured the Bill, some wholeheartedly and others with certain suggestions and issues of their concerns. With this, the Bill gets nod of Parliament as the Rajya Sabha has already passed it last week. 

Earlier in the day, Naidu made a strong pitch in the Lok Sabha for “some sort of understanding”, saying passage of the legislation is necessary to make land available for the programme of ‘Housing-forAll’ by 2020. 

“Land is a major issue...want some solution whereupon people of different parties try to find some sort of understanding on Land Bill at the earliest.”  Naidu noted that land is acquired for affordable housing and no one could create hundreds of houses without that. The minister said the Real Estate Bill aims to protect the interests of buyers and bring more transparency in the housing sector. 

It is the need of the hour as lots of consumers have been taken for a ride by various unscrupulous people, he said but added that he was not berating the entire industry. He also assured the construction industry that the measure would help attract greater flow of investment, including from foreign investors and will help in reducing cost of borrowing. 

Initiating the debate, K C Venugopal (Cong) said he is happy that Naidu admitted that the bill is the baby of the UPA government.

The Bill provides that 70 per cent of sale proceeds in a deal will have to be kept aside by the  developer in an escrow account and that sum would be utilised for land cost and construction of the related project only, piloting the Bill for consideration and passage, Urban Development Minister Venkaiah Naidu said. An escrow account constitutes a financial instrument held by a third party on behalf of the two  parties involved in the transaction. “It, therefore, provides greater certainty to buyers that the money they pay to the developer will be utilised for development of the project where they have bought houses,” the minister explained.