What are the penalties under RERA for builders?

RERA prescribes stringent penalties for developers and builders who violate its provisions including failure to register projects, non-disclosure, fund diversion, delayed possession, and non-compliance with RERA orders. Penalties are designed to be deterrent, ranging from financial fines to imprisonment for serious offences.

Penalty for Non-Registration of Project

Up to 10% of the estimated project cost if the developer fails to register the project under RERA before marketing or selling.

Penalty for Providing False Information

Up to 5% of the estimated project cost for furnishing false or misleading information to the RERA authority.

Penalty for Non-Compliance with RERA Orders

Up to 5% of the estimated project cost per order violation, plus potential imprisonment of up to 1 year or both.

RERA penalties are significant both financially and reputationally and are increasingly being enforced by state RERA authorities. Developers who register projects, maintain escrow discipline, and communicate transparently have nothing to fear; those who don't face escalating penalties that can materially impact project viability.