HRERA has proposed opening of a dedicated bank account for completion of a project.
The Haryana Real Estate Regulatory Authority (HRERA) has introduced new rules to check the rampant diversion of funds from one project to the other by the builders. It has proposed opening of a dedicated bank account for completion of a project.
The dedicated RERA account will be used for depositing 70 per cent of the total amount realised from the allottees of a particular project.
“The RERA account shall be free from all encumbrances, lien, loan and the control of any third party (lender/bank/financial institution). The account shall be exclusively used for the construction and development of the project and proportionate land cost,” HRERA secretary said in a notification issued recently.
It was also cleared that no amount from the RERA account will be used to make repayment and pre-payment of the project loans or other liability.
However, in case of loans, the builder will be paying the loan amount and the interest from the “free account.” It may be recalled that 30% of the total receipts (apart from 70% in the RERA account) from the allottees would be deposited in the “free account.”