RERA Separate bank account provisions

RERA Separate bank account provisions
  • General
  • Saturday 9th March 2019
  • Author: RIYA KAPOOR

Highlights

  • As per section 4(2)(I)D), every promoter is required to open RERA separate account in a scheduled bank to cover the cost of construction and land cost of the project.

  • The withdrawal from such accounts should be in accordance with act, rules, and regulations as prescribed.

  • The promoter is required to get his accounts audited within six months after the end of every financial year

  • The Promoter shall deposit seventy percent of the amount collected from Allottees in the RERA Account.

As per section 4(2)(I)D), every promoter is required to open RERA separate account in a scheduled bank to cover the cost of construction and land cost of the project.

The withdrawal from such accounts should be in accordance with act, rules, and regulations as prescribed.

Account opening for project registration in RERA

1. RERA account shall be opened for each of the projects to be registered in RERA. Details of the project-specific account are to be submitted by the promoter at the time of registration of the project.

2. Every project should have only RERA account. In the case of multiple promoters, necessary contractual or legal arrangements should be made by the principal promoter, who is registering the project, to ensure proper operations of RERA Account.

Deposit in account

1.  The Promoter shall deposit seventy percent of the amount collected from Allottees in the RERA Account. In the case of a project where the estimated cost to complete the project is higher than the estimated value of sales revenue, hundred percent of the amount collected from the Allottees shall be deposited in the RERA  Account.

  2. The money lying in the RERA Account can be put in fixed deposits with the bank operating the RERA Account provided it is a ‘No Lien Fixed Deposit’ and no loan can be obtained against or on such Fixed Deposit nor any charge can be created on such Fixed Deposit.

Withdrawal from account

1. As per the second proviso to section 4(2)(l)(D) of the Act which provides that the amounts from the RERA Account shall be withdrawn by the promoter after it is certified by an architect, an engineer and a chartered accountant in practice, that the withdrawal is in proportion to the percentage of completion of the project.

2. The promoter shall have following certificates for withdrawal from bank account :     

a) Certificate from the Architect in Form 1 certifying the percentage of completion of construction work of each of the tasks/activity of the building wing of the project

b) Certificate from the Engineer in Form 2 for the actual cost incurred on the construction work of each of the building/wing of the project.

c) Certificate from a practicing Chartered Accountant in practice other than the statutory auditor of the Promoter in Form 3, for the cost incurred and paid on construction cost and the land cost.

Auditing of account

The promoter is required to get his accounts audited within six months after the end of every financial year by the statutory auditor of the Promoter’s enterprise and produce the report on the statement of accounts on project fund utilization and withdrawal by Promoter in Form‐5 in accordance with respective state rules.

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