4.2 Functions, Duties & Code of Conduct for Agents

4.2 Functions, Duties & Code of Conduct for Agents

Real estate agents serve as the vital operational link between developers (promoters) and property buyers (allottees). To prevent deceptive sales practices and protect consumer interests, Section 10 of the RERA Act 2016 outlines mandatory statutory duties for agents. These duties are amplified by the MahaRERA Code of Conduct, regulatory circulars, and mandatory periodic filing requirements.

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1. Five Mandatory Statutory Duties (Section 10)

Under Section 10 of the RERA Act 2016, every registered real estate agent is bound by five core legal duties:

Duty 1: Exclusively Market Registered Projects (Section 10(a))

An agent shall not facilitate the sale or purchase of any plot, apartment, or building in a real estate project being sold by a promoter in any planning area which is not registered with MahaRERA. Before accepting a marketing engagement, the agent must verify the project's active MahaRERA Registration Number on maharera.maharashtra.gov.in.

Duty 2: Maintenance & Preservation of Records (Section 10(b) & Rule 16)

Section 10(b) requires an agent to maintain and preserve such books of account, records and documents as may be prescribed. Rule 16 supplies the prescription, and it does so by reference rather than by fixing its own period.

• The Standard: Rule 16 requires the agent to maintain and preserve books of accounts, records and documents as required under the Income Tax Act, 1961, the Companies Act, 2013, or any other law for the time being in force. Do not memorise a flat "five years" for this rule — the exam-safe answer is that Rule 16 points to the applicable tax and company law. In practice that means six years from the end of the relevant assessment year under Income-tax Rule 6F, and eight years under Section 128 of the Companies Act, 2013, for corporate agents.
• Inspection Rights: Rule 16 expressly requires the agent to produce these records for inspection when needed for the grant or renewal of registration.
• Separate PMLA Rule: A distinct five-year retention period does exist, but it comes from the Prevention of Money Laundering Act, 2002 for KYC and transaction records — not from Rule 16. Section 7.2 covers it.

Duty 3: Prohibition of Unfair Trade Practices (Section 10(c))

An agent shall not involve in any unfair trade practice during the solicitation or sale of any property. Unfair trade practices specifically include:

1. False Representation of Services: Falsely representing that services are of a particular standard or grade.
2. False Claims of Approval: Falsely representing that the promoter or the project has approval, affiliation, or sanctions which they do not possess.
3. Misleading Advertisements: Making misleading statements in print, digital, or oral promotions regarding completion dates, amenities, or pricing.
4. Permitting Misleading Publications: Permitting the publication of any advertisement or prospectus of a project that is not authorized or contains false disclosures.

Duty 4: Handover of Statutory Documents to Allottee (Section 10(d))

An agent must ensure that the allottee is enabled to possess all statutory documents at the time of booking. The agent is obligated to provide the buyer with true copies of:

• Sanctioned layout plans, building plans, and floor specifications.
• Approved project schedule and completion milestones.
• Draft Agreement for Sale (Form of Agreement under Rule 10).
• Allotment letter issued by the promoter.

Duty 5: Compliance with RERA Rules & Orders (Section 10(e))

An agent must discharge all other functions and adhere to all directions, circulars, and orders issued by MahaRERA from time to time.

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2. Mandatory Advertising & Disclosure Standards

To eliminate deceptive marketing, MahaRERA issued strict advertising guidelines that apply directly to real estate agents.

Display of Agent Registration Number (Section 9(5) & Rule 14)

• Section 9(5) requires the registration number to be quoted in every sale the agent facilitates, and Rule 14 requires it to be displayed at the principal place of business and at every branch office and quoted on all advertisement, marketing, sale and purchase documents. Registration numbers follow the A5... agent series (for example A518000XXXXX).
• Applicable channels include print advertisements, newspaper features, hoardings, digital banners, websites, social media posts (Facebook, Instagram, LinkedIn, YouTube), business cards, and video promotions.

Display of Project QR Code (Orders 46/2023, 46A/2023, 46B/2023 & 46C/2025)

• Agents publishing any advertisement or brochure for a registered project must embed the project's official QR Code alongside the agent's registration number, in the top-right quadrant and in a legible, high-contrast font, per the display norms in Order 46C/2025.
• Scanning the QR code with a smartphone must directly redirect the buyer to the verified public disclosure page of that project on the MahaRERA portal, allowing instant inspection of Form 1-5 certificates, title reports, and encumbrances.

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3. Mandatory Half-Yearly Progress Reports (MahaRERA Order No. 43/2023)

To ensure ongoing compliance surveillance, MahaRERA issued Order No. 43/2023, making it compulsory for every registered real estate agent to publish a half-yearly progress report in Form 6 on the agent's own web page.

Required Contents of Form 6

1. The agent's name, MahaRERA registration number and MahaRERA Certificate of Competency number.
2. The period covered (from dd/mm/yy to dd/mm/yy).
3. Projects in which the agent has been designated by the promoter to act as real estate agent under Section 4(2)(j) of the Act.
4. Particulars of the real estate transactions facilitated during that half-year.

Except for the portions marked '\', the whole of Form 6 is placed in public view, so a prospective buyer can independently check what an agent has actually transacted.

Consequence of Non-Filing: Order 43/2023 states that where the report is not filed in the prescribed manner and within the prescribed timelines, action as deemed fit shall be initiated by the Authority. It does not create an automatic suspension. In practice the sharper consequence is procedural: MahaRERA requires the Form 6 half-yearly progress report to be uploaded along with the renewal application, so a missing report stalls renewal.

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4. Financial Integrity & Handling Allottee Funds

Ethical conduct under RERA requires agents to maintain strict financial boundaries:

• Direct Payment to Escrow: All booking amounts, advance payments, and installment funds collected from allottees must be made payable directly to the promoter's designated 70% separate RERA bank account. Agents are strictly prohibited from receiving allottee booking payments into their personal or brokerage bank accounts.
• Commission Disclosures: Agents must disclose their commission terms upfront in writing to the buyer or promoter. Double-dipping or collecting secret undisclosed profits violates Section 10(c).

Statutory Duties vs. Prohibited Practices Matrix

The table below contrasts an agent's statutory legal duties against illegal practices and non-compliance penalties under the RERA legal framework.

Half-Yearly Reporting Deadlines & Record Retention Math

Agents must track their statutory compliance windows using fixed calendar calculations:

$\text{Period 1 Submission Window} = \text{Period End (Sept 30)} + 20 \text{ days} = \text{October 20}$

$\text{Period 2 Submission Window} = \text{Period End (March 31)} + 20 \text{ days} = \text{April 20}$

Record retention, by contrast, has no single RERA number to memorise. Rule 16 defers to the Income Tax Act, 1961 and the Companies Act, 2013:

$\text{Income-tax Rule 6F} = 6 \text{ years from the end of the relevant assessment year}$

$\text{Companies Act 2013, s.128} = 8 \text{ years of financial year records}$

A MahaRERA-registered agent operating as a private limited company therefore keeps its statutory books for eight years, while an individual proprietor works to the six-year income-tax horizon. Separately, the PMLA, 2002 imposes a five-year retention period on KYC and transaction records (Section 7.2).