2.1 Mandatory Project Registration & Exemptions
Key Takeaways
- Real estate projects exceeding 500 square meters of land area OR 8 apartments must be registered with MahaRERA before marketing, advertising, booking, or selling.
- Section 3(2) provides specific exemptions: land area <= 500 sq. m. AND apartments <= 8; projects receiving CC/OC prior to 1st May 2017; and non-commercial structural repairs/renovations without new sales.
- Phase-wise registration under Section 3(1) proviso allows large developments to register each phase as an independent real estate project with its own completion date and 70% separate escrow account.
- Promoters marketing or accepting bookings for unregistered projects face penalties up to 10% of total project cost under Section 59(1), and up to 3 years imprisonment or additional 10% fine under Section 59(2) for continued default.
- Registration validity aligns strictly with the promoter's declared completion date, with extensions under Section 6 capped at an aggregate maximum of 1 year for force majeure or reasonable cause.
2.1 Mandatory Project Registration & Exemptions
Quick Summary: Section 3 of the Real Estate (Regulation and Development) Act, 2016 (RERA) mandates that no promoter can advertise, market, book, sell, or offer for sale any plot, apartment, or building in a real estate project without prior registration with MahaRERA. Registration is required whenever a project exceeds 500 square meters of land area OR 8 apartments. Exemption applies only when both thresholds remain unexceeded, for pre-RERA projects with Completion Certificates, or for non-commercial structural renovations.
1. Statutory Registration Mandate & Thresholds (Section 3(1))
Under Section 3(1) of RERA 2016, mandatory registration with the Maharashtra Real Estate Regulatory Authority (MahaRERA) applies to all commercial, residential, and plotted real estate developments prior to any public invitation, advertisement, or booking collection.
The statutory threshold logic relies on a disjunctive OR condition between two independent physical parameters:
| Statutory Parameter | Threshold Limit | Regulatory Requirement |
|---|---|---|
| Land Area | Exceeds 500 square meters | Mandatory Registration (even if units $\le 8$) |
| Apartment Count | Exceeds 8 apartments | Mandatory Registration (even if land $\le 500\text{ m}^2$) |
| Plotted Developments | Exceeds 500 sq. m. OR > 8 plots | Mandatory Registration |
| Dual Below-Threshold | Land $\le 500\text{ m}^2$ AND Units $\le 8$ | Exempt under Section 3(2)(a) |
Key Exam Concept: The Disjunctive "OR" Rule
Candidates must remember that satisfying either criterion triggers mandatory registration:
- Scenario A: A builder constructs 6 luxury villas on a land parcel of 750 sq. meters. Although the unit count (6) is below 8, the land area (750 sq. m.) exceeds 500 sq. meters, making MahaRERA registration mandatory.
- Scenario B: A developer builds a 4-story building containing 12 compact studio apartments on a small plot of 380 sq. meters. Although land area (380 sq. m.) is below 500 sq. meters, the apartment count (12) exceeds 8, making MahaRERA registration mandatory.
- Scenario C: A developer constructs 6 apartments on a 420 sq. meter plot. Because both land area ($\le 500\text{ m}^2$) AND apartment count ($\le 8$) remain below their respective limits, the project is exempt from registration.
2. Statutory Exemptions from Registration (Section 3(2))
Section 3(2) of the Act outlines three explicit statutory exemptions where real estate projects are not required to register with MahaRERA:
1. De Minimis Projects (Section 3(2)(a))
Projects where the area of land proposed to be developed does not exceed 500 square meters AND the number of apartments proposed to be developed does not exceed 8 units. Both conditions must be met simultaneously.
2. Pre-RERA Completion / Occupation Certificate (Section 3(2)(b))
Projects where the promoter received a valid Completion Certificate (CC) or Occupation Certificate (OC) from the local planning authority (e.g., BMC, PMC, NMMC) prior to the implementation of RERA (i.e., prior to 1st May 2017). Ongoing projects without CC/OC as of 1st May 2017 were required to register as "ongoing projects."
3. Structural Renovation & Repair (Section 3(2)(c))
Projects limited to renovation, repair, or internal structural alteration that do not involve advertising, marketing, booking, or selling any apartment, plot, or building to external purchasers. If redevelopment involves constructing additional units for open-market sale, registration is mandatory.
3. Phase-Wise Registration Architecture (Section 3(1) Proviso)
Large township developments spanning multiple acres and extended construction schedules can be registered in independent phases under the proviso to Section 3(1):
- Independent Project Status: Each registered phase is treated as a distinct, standalone real estate project with its own unique MahaRERA registration number.
- Dedicated Escrow Account: Each phase must maintain a separate 70% escrow bank account for customer payments.
- Standalone Timeline: Each phase has its own legally binding completion date and progress schedules.
- Shared Common Amenities: Promoters must explicitly disclose how common infrastructure (clubhouse, central park, access roads) is shared across phases and declare committed completion deadlines for each shared amenity.
4. Application Process, Registration Validity & Extensions (Section 4, 5 & 6)
Application & Form C Registration Certificate
Promoters file an online application on the MahaRERA portal (Form A for project details, Form B for statutory declarations). Upon scrutiny of title deeds, sanctioned plans, local authority approvals, and professional certificates, MahaRERA issues a Certificate of Registration (Form C) containing the project's unique registration number and QR code.
Validity Period
Registration remains valid strictly for the operational period declared by the promoter in the application for project completion.
Statutory Extension Rules (Section 6)
If a promoter fails to complete construction within the declared timeline, registration extension may be requested under Section 6:
- Force Majeure: Extensions granted due to natural calamities (floods, earthquakes, drought, fire, cyclones) or war. No penalty fee is charged, and extensions are capped at an aggregate maximum of 1 year.
- Reasonable Cause: In non-force majeure situations, MahaRERA may extend registration for valid technical or administrative reasons for an aggregate period not exceeding 1 year, subject to payment of prescribed extension fees.
5. Statutory Penalties for Non-Compliance (Section 59 & Section 62)
MahaRERA enforces strict penalties to curb unauthorized pre-launches and unregistered sales:
| Violation | Responsible Party | Statutory Penalty under RERA 2016 |
|---|---|---|
| Failure to Register Project | Promoter | Fine up to 10% of estimated project cost (Section 59(1)) |
| Continued Default / Willful Breach | Promoter | Imprisonment up to 3 years, or additional fine up to 10% of project cost, or both (Section 59(2)) |
| Facilitating Unregistered Sales | Real Estate Agent | Fine of INR 10,000 per day of default, or up to 5% of property cost (Section 62) |
Real estate agents have a statutory duty under Section 10(a) to verify that a project holds a valid MahaRERA Registration Number and QR code before displaying brochures, advertising, or taking buyers to project sites.
Under Section 3 of the Real Estate (Regulation and Development) Act, 2016, which of the following real estate projects is legally REQUIRED to register with MahaRERA prior to marketing or accepting bookings?
If a promoter advertises or accepts bookings for an unregistered real estate project that requires registration under RERA Section 3, what is the maximum penalty prescribed under Section 59 of the Act?
Under Section 6 of RERA 2016, an extension of MahaRERA project registration due to force majeure events (such as floods, earthquakes, or war) can be granted for what maximum period?