A Developer's Obligations Under MahaRERA

Under MahaRERA — the Maharashtra wing of the Real Estate (Regulation and Development) Act, 2016 (RERA) — your developer is legally called the promoter and carries a fixed list of duties towards buyers and society members. In short, the promoter must register the project before advertising or selling it (Section 3), keep 70% of the money collected from buyers in a separate project bank account and draw it only against certified construction progress (Section 4(2)(l)(D)), upload quarterly progress and financial updates to the MahaRERA website, build strictly to the sanctioned plan and not change it without two-thirds consent (Section 14), fix structural defects for five years after handover (Section 14(3)), and deliver on time or pay the price of delay (Section 18). These duties carry penalties, and they replaced the far weaker protections that existed under the older Maharashtra Ownership Flats Act, 1963 (MOFA). This guide explains each one in everyday language, with worked examples and a checklist your committee can act on.

Four numbers from the Act are worth memorising before your next general body meeting, because each one is a line a developer cannot lawfully cross:

Source: Real Estate (Regulation and Development) Act, 2016, sections 4, 13 and 14.

Who is a "promoter", and does your redevelopment fall under MahaRERA?

In everyday speech you say "the developer" or "the builder". RERA uses one word — promoter — for the person or company that constructs and sells a project. In a redevelopment, that is your appointed developer. Existing members are treated as allottees for the new rehabilitation flats they receive, and outside buyers of the extra "sale" flats are allottees too. Importantly, the definition of promoter in Section 2(zk) is wide enough to catch a society itself: it covers any person who develops land into a project or constructs apartments for sale, and its explanation says that where the person who constructs and the person who sells are different persons, both are deemed promoters and are jointly liable for the functions and responsibilities under the Act. So in self-redevelopment, or where the society signs on as co-promoter alongside a builder, the promoter's duties attach to the society too — including the 70% account and the delay liability.

The registration threshold

Registration is not optional for most projects. Under Section 3 a promoter cannot advertise, market, book or sell without a MahaRERA registration number. Section 3(2) exempts only very small projects — where the land is up to 500 square metres or the project has up to eight apartments. Most society redevelopments comfortably cross this line and therefore must be registered.

If you want the bigger picture of how the whole Act maps onto redevelopment, see our note on RERA for redevelopment.

Obligation 1 — Register before selling or advertising (Section 3)

The most basic duty is registration. When a developer registers a project, they must upload key documents to the public MahaRERA portal — the sanctioned plan, the layout, the land-title details, the declared completion date, and the names of the architect, engineer and contractor. Until a registration number is issued, not a single flat may be booked or advertised.

For a society, this is powerful. It converts "possession in three years" from a spoken assurance into a dated, declared commitment on a government website that you can point back to later. Before you sign anything, confirm the project is registered and that its declared completion date matches what the developer told your general body. Lining that up against the commercial terms is easier with our offer comparison tool.

The two deadlines built into registration

Registration itself runs on a clock, and both ends of it are numbers your committee can check.

The one-year extension cap is the useful one. If a developer tells your general body that "the RERA date can always be pushed", that is wrong: beyond a single aggregate year of force-majeure extension, a slipping project is a Section 18 delay with money attached, not a paperwork problem. The three-month conveyance deadline in Section 17(1) is the number to write into your development agreement — it is the point at which the land and common areas legally become the society's.

Source: Real Estate (Regulation and Development) Act, 2016, sections 5, 6 and 17.

Obligation 2 — Keep 70% of buyers' money in a separate account (Section 4(2)(l)(D))

One of RERA's biggest changes is how money is handled. Section 4(2)(l)(D) requires the promoter to deposit 70% of the amounts collected from allottees into a separate account in a scheduled bank, maintained only for that project. This "ring-fences" the money so funds collected for your building cannot be spent on a different one.

That 70% can be withdrawn only to cover the cost of construction and land for the same project, and only in proportion to how much work is actually completed. In practice this is policed by professionals: an engineer, an architect and a chartered accountant must certify the stage of completion before each drawdown. On top of that, the promoter's project accounts must be audited by a chartered accountant every year, within six months of the end of each financial year, to confirm the withdrawals matched the progress.

Worked example: how the 70% rule protects your society

Suppose the developer has collected Rs 100 crore from sale-flat buyers. At least Rs 70 crore must sit in the separate project account. If the building is 40% complete on certified measurement, the developer can draw down only up to about that proportion of the ring-fenced funds — not the whole Rs 70 crore up front. So money follows genuine progress, rather than the developer collecting heavily and then stalling. For your society, that materially lowers the risk of a builder running out of cash halfway through.

The 10% rule and what must be inside the registered agreement (Section 13)

This is the single most useful number on this page, and the one societies most often miss. Section 13(1) says a promoter shall not accept more than 10% of the cost of the apartment as an advance payment or application fee without first entering into a written agreement for sale and registering that agreement. Not a booking form, not an allotment letter, not a memorandum of understanding — a registered agreement for sale.

In a redevelopment this bites in two places: members who buy additional area over their entitlement, and outside buyers of the sale flats whose money is what funds your building. If the developer is collecting well above 10% on unregistered paper, the project is being financed outside the Section 4(2)(l)(D) account — which is precisely the pattern that leaves societies stranded.

The eight things Section 13(2) says the agreement must specify

Section 13(2) requires the agreement for sale to be in the prescribed form and to state particular things. Use this as a demand list — if a draft put in front of your members is silent on any row below, it is not yet a compliant agreement.

Row 8 is the one to read twice. Section 13(2) requires the rate payable by the promoter to the allottee and by the allottee to the promoter to both be stated. A draft that charges a member 18% for a late instalment but gives the member nothing, or a token amount, for a year of delayed possession is not a balanced agreement — the Act contemplates a single rate running in both directions.

Separately, in a redevelopment each member's Permanent Alternate Accommodation Agreement (PAAA) should itself be registered. Members sometimes sign the development agreement and nothing else; the PAAA is what records your flat, your carpet area and your possession date.

Source: Real Estate (Regulation and Development) Act, 2016, section 13(1) and 13(2).

Obligation 3 — Upload quarterly progress and financial updates

Transparency is a continuing duty, not a one-time filing. A registered promoter must keep the project page on the MahaRERA website current, with quarterly updates showing how far construction has reached, the flats booked, approvals received and the financial position of the project.

For members, this is a free monitoring tool. You do not have to rely only on what the developer tells the committee in a meeting — you can open the official project page and read the declared progress yourself, quarter by quarter. If what you see on site does not match what is uploaded, that gap is worth raising in writing, early.

Obligation 4 — Build to the sanctioned plan; no changes without two-thirds consent (Section 14)

Section 14(1) requires the promoter to develop the project in accordance with the sanctioned plans, layout plans and specifications approved by the competent authority. Section 14(2) then locks those plans down: the promoter shall make no additions or alterations to the sanctioned plans, layout plans, specifications, or the nature of fixtures, fittings and amenities described in the agreement for sale, except in two narrow situations.

Two different consents — do not confuse them

This is where most societies get the rule wrong. Section 14(2) has two thresholds, and which one applies depends on what is being changed.

Note the exact wording of the two-thirds test: it is two-thirds of the allottees other than the promoter. Flats the developer still holds unsold, or has kept for itself, are excluded from the count. That is a meaningful protection in a redevelopment, where the developer may hold a large block of unsold sale flats and would otherwise vote them.

Your building's two-thirds number — read it off this table

Work this out once, before any meeting where a plan change is proposed, and record it in the minutes. A developer arriving with "majority approval" is not the same thing as the statutory two-thirds. Count only allottees other than the promoter, and round any fraction up — two-thirds of 40 is 26.67, so the number is 27, not 26.

The third column is the one to keep in your pocket. In a 60-member building, 21 members standing together are enough to stop an alteration of the sanctioned layout: 21 refusals leave only 39 possible consents, one short of the 40 the Act requires. That is a blocking minority, and it is smaller than most committees assume.

This directly protects the carpet area and amenities your society negotiated; you can read our summary of the position on changing sanctioned plans needs consent. Make sure your development agreement mirrors Section 14(2) instead of giving the builder a general power of attorney to amend plans at will — a common trap covered in our red flags in a development agreement guide. Also insist on the Section 11(3) right: at the time of booking the promoter must make the sanctioned plans and layout plans available to you, along with the stage-wise time schedule of completion. Ask for that schedule in writing — it is the document that lets you measure progress against a promise rather than against a mood.

Source: Real Estate (Regulation and Development) Act, 2016, sections 11(3) and 14.

What "carpet area" legally means — and why it includes your internal walls (Section 2(k))

Every number in a redevelopment offer is quoted in carpet area, so the definition is worth more to your members than almost anything else on this page. RERA does not leave it to the builder. Section 2(k) defines carpet area as the net usable floor area of an apartment, and then says exactly what is out and what is in.

Read that right-hand column again. Internal partition walls count as your carpet area. This is the opposite of what most members are told, and the opposite of the old builder practice of measuring "carpet" as bare floor between finished wall faces. If a developer's offer letter defines carpet area as "the area excluding all walls", it is not offering you RERA carpet area — it is offering you less, and the difference is real money.

This matters doubly in Mumbai because DCPR 2034 Regulation 2 states that carpet area carries the same meaning as under RERA 2016. So when your entitlement under a redevelopment scheme is expressed in carpet area, it is RERA carpet — internal partition walls included.

The concrete action: ask the developer, in writing, for the flat-wise carpet area statement certified by the project architect, expressly stated to be carpet area as defined in Section 2(k) of RERA, and require that exact wording in the PAAA. Then check the same figure on the project's MahaRERA page. Two other checks follow from the definition — a balcony quoted inside "carpet" is inflating the number, and any figure described as built-up or saleable area is not carpet area at all and cannot be compared with it. Our offer comparison tool puts competing offers on the same carpet basis.

The exact words to insist on in the PAAA

Do not let "carpet area" stand in the agreement as a bare phrase — that is how the 38 sq ft above disappears. Require a definition clause in these terms, with the architect's flat-wise schedule annexed to it:

Three checks once that clause is in: the figure in the schedule must match the figure on the MahaRERA project page; the architect's certificate must name Section 2(k); and no balcony, verandah, terrace or shaft area may appear anywhere inside the carpet figure.

Source: Real Estate (Regulation and Development) Act, 2016, section 2(k); DCPR 2034 (sanctioned), Regulation 2.

Obligation 5 — Fix structural defects for five years (Section 14(3))

The promoter's responsibility does not end at handover. Under Section 14(3), if any structural defect — or a defect in workmanship, quality or the provision of services — is brought to the promoter's notice within five years from the date of handing over possession, the promoter must rectify it without further charge, within thirty days. If the promoter fails to rectify within those thirty days, the aggrieved allottees are entitled to receive appropriate compensation under the Act.

Both numbers are worth writing on the noticeboard. The five years runs from possession, not from the occupancy certificate or from completion, so the clock for each member starts on the day that member's flat is handed over. And the developer's window is 30 days from notice — not "as soon as practicable", not "after the monsoon".

How to preserve the 30-day clock

• Send the defect complaint in writing — email or letter to the promoter's registered address — never only by phone or through the site engineer.
• Date it, and keep the delivery proof. That date is what starts the thirty days.
• Attach photographs and the flat number; list each defect separately.
• Diarise day 31. If nothing is fixed, the entitlement to compensation has arisen and you can file with MahaRERA.
• Have the society keep one consolidated register of all members' defect notices with dates — a pattern across many flats is far stronger evidence than one complaint.

This is also why the defect-liability clause in your agreement must not be watered down below the five-year, thirty-day legal floor. A draft that says "two years" or "at the developer's discretion" is below the statutory minimum. See our overview of defect-liability court orders for how members have enforced this in practice.

Source: Real Estate (Regulation and Development) Act, 2016, section 14(3).

Obligation 6 — Deliver on time, or pay: delay remedies (Section 18)

RERA's strongest protection for buyers is against delay. Under Section 18, if the promoter fails to hand over possession by the date declared to MahaRERA, an allottee has a choice: withdraw from the project and claim a full refund of the money paid, together with interest, or stay in the project and claim interest for every month of delay until possession is given. This shifts the cost of delay onto the developer instead of the members.

The rate is a formula, not a fixed percentage

The interest rate is not left to the agreement. The Maharashtra RERA Rules, 2017 prescribe a single formula for both directions: the State Bank of India's highest Marginal Cost of Lending Rate (MCLR) plus 2%. Because MCLR moves, look up SBI's current highest MCLR on the date you are computing, then add two percentage points. The same rate is what the promoter may charge a member for a late instalment — it cuts both ways, which is exactly what Section 13(2) requires the agreement to record.

The catch every rehabilitation member should understand

Section 18 interest runs on the amount you have paid the promoter. An existing member receiving a rehabilitation flat usually pays the developer nothing, so on a strict reading their Section 18 interest is calculated on a small base or on nil. Their real protection against delay is contractual: the monthly transit rent, the escalation on it, the corpus, and a liquidated-damages clause. Section 18 protects the money you paid; the development agreement has to protect the time you lost.

So the concrete action is at drafting stage: insist the development agreement fixes (a) the transit rent per month per member with a stated annual escalation, (b) that rent continues until actual possession with no cut-off date, (c) a separate liquidated-damages amount per member per month of delay beyond the MahaRERA-declared date, and (d) a bank guarantee or security securing them. Benchmark the damages figure to the same MCLR + 2% formula so it is defensible.

One more point with no expiry date attached: under Section 18(2), if members suffer loss because of a defective title to the land, the promoter must compensate them, and that claim is not barred by limitation under any other law. For a society whose property documents are old or incomplete, that is an unusually strong and permanent right.

If your project is already late, our guide on what to do when a builder delays walks through the practical steps, and a badly stalled project may justify terminating a non-performing developer.

Source: Real Estate (Regulation and Development) Act, 2016, section 18; Maharashtra RERA Rules, 2017 (prescribed rate of interest).

The developer's core MahaRERA duties at a glance

What non-compliance actually costs the promoter

These duties are not advisory. The Act attaches money penalties to each of them, calculated on the estimated cost of the real estate project as determined by the Authority — so on a large redevelopment the exposure is substantial. Quoting the right section in your first letter changes the tone of the reply.

The practical use of this table is leverage, not litigation. When a committee writes to a developer citing Section 61 and the 5% figure, it is stating a consequence the developer's own lawyer will confirm — which is a different conversation from asking politely for a third time.

Source: Real Estate (Regulation and Development) Act, 2016, sections 59 to 64.

How to check a project's registration and file a complaint

You do not need a lawyer for the first checks. On the official MahaRERA website there is a public project search where you can look up a registered project by its name, the promoter's name or the registration number. Once a project page opens, you can see the declared completion date, the sanctioned plans, the professionals involved and the uploaded quarterly progress.

A quick verification routine for your committee

• Search the developer's proposed project and confirm the registration number is valid and current, not lapsed.
• Check the declared completion date matches the timeline in your draft agreement — and note whether the one-year Section 6 extension has already been used.
• Compare the sanctioned plan and flat areas online with what the developer has shown your members.
• Confirm the flat-wise carpet areas are expressed as Section 2(k) carpet area, internal partition walls included, and not as built-up or saleable area.
• Confirm nothing above 10% of cost has been collected from any member or buyer before a registered agreement for sale — Section 13(1).
• Work out your building's two-thirds number (allottees excluding the promoter) and record it in the minutes before any plan-change proposal.
• Each quarter, open the project page and compare declared progress with what you see on site.
• Look at the promoter's track record — under the 79A directive, a shortlisted developer must already have at least one MahaRERA-registered project.

If the promoter breaks an obligation — misses possession, changes plans without consent, or refuses to fix defects — an aggrieved allottee or the society can file a complaint with MahaRERA online, on payment of the prescribed fee. MahaRERA can then order the promoter to comply, refund money, or pay interest and compensation. Keeping paperwork organised makes any complaint far stronger; our free downloads and the how to choose a developer guide help your committee stay prepared from day one.

What this means for your society, in practice

Read together, these obligations give ordinary members a level of protection that simply did not exist under MOFA. The registration duty makes the timeline public; the 70% account keeps the money honest; the quarterly updates let you monitor without a fight; Section 14 protects the area and amenities you bargained for; Section 14(3) keeps the builder on the hook for defects; and Section 18 makes delay expensive for the developer, not just painful for you.

The practical lesson is to use these rules before you sign, not only after something goes wrong. Insist the development agreement restates the five-year defect liability, the sanctioned-plan lock, and the completion date, and that each member's Permanent Alternate Accommodation Agreement (PAAA) is registered. If your society is also stepping in as a co-promoter, remember the promoter's duties may then attach to the society too — a reason to plan the structure carefully and read our possession and corpus guide alongside this one.

Where to find the official rule

The parent law is the Real Estate (Regulation and Development) Act, 2016, passed by the Government of India, along with the Maharashtra rules made under it. The regulator for our state is MahaRERA, and its official website carries the project search, the promoter and agent registration system, the online complaint facility, and the circulars and orders it issues from time to time. Because thresholds, timelines and procedures are refined periodically through MahaRERA circulars, always confirm the current position on the official MahaRERA portal or the text of the Act rather than relying on older summaries — several procedural details have been clarified and tightened since 2017. For anything specific to your plot's building potential, use our FSI calculator rather than a general figure.