Under Section 13 of the Real Estate (Regulation and Development) Act, 2016 (“RERA”), a promoter/developer cannot accept more than 10% of the cost of the apartment, plot, or building from a buyer as booking amount, advance, or application money unless:

1. A written Agreement for Sale is executed with the buyer; and
2. The Agreement for Sale is registered under the applicable registration law.

The Agreement for Sale must contain details such as:

• Project specifications
• Carpet area
• Payment schedule
• Possession date
• Interest/penalty clauses for default by promoter or allottee
• Internal and external development works details.

Relevant Provision

Section 13(1) provides that:

No promoter shall accept more than 10% of the cost without first entering into and registering an Agreement for Sale.

Penalty for Violation

If the promoter violates Section 13, penalty is generally imposed under Section 61 of RERA.

Under Section 61:

• The promoter may be liable to a penalty up to 5% of the estimated cost of the real estate project as determined by the RERA Authority.