RERA Act, 2016 | Chapter VIII | Offences, penalties and adjudication

Section 62: Penalty for Non-Registration and Contravention under Sections 9 and 10

Section 62 of the Real Estate (Regulation and Development) Act, 2016 (RERA) prescribes a daily monetary penalty where a real estate agent fails to comply with or contravenes the agent registration requirements under Section 9 or statutory obligations under Section 10. The penalty is Rs 10,000 for each day of continuing default, subject to a statutory cumulative ceiling of 5% of the specified property cost.

Text of Section 62 - Penalty for non-registration and contravention under sections 9 and 10

If any real estate agent fails to comply with or contravenes the provisions of section 9 or section 10, he shall be liable to a penalty of ten thousand rupees for every day during which such default continues, which may cumulatively extend up to five per cent of the cost of plot, apartment or buildings, as the case may be, of the real estate project, for which the sale or purchase has been facilitated as determined by the Authority.

What do Sections 9, 10 and 62 mean?

Section 9: Registration of real estate agents

Section 9 requires a real estate agent to obtain registration with the appropriate Real Estate Regulatory Authority before facilitating sales or purchases in a real estate project, or part of a project, registered under RERA. It also addresses the application, registration number, validity and renewal, and circumstances in which registration may be revoked or suspended. The applicable State or Union Territory rules govern procedural details.

Section 10: Functions and duties of real estate agents

Section 10 requires registered agents, among other duties, not to facilitate the sale or purchase of an unregistered project where registration is required; to maintain prescribed books and records; not to engage in specified unfair trade practices; to facilitate the provision of documents and information to allottees; and to perform other prescribed functions.

Section 62: Consequences of non-compliance

Where an agent violates Section 9 or Section 10, the Authority may impose the statutory penalty for the duration of the continuing default, subject to the prescribed cumulative limit. Section 62 concerns real estate agents; distinct penalty provisions govern promoters and other parties.

Daily penalty and maximum limit

The statutory rate is Rs 10,000 per day for each day during which the default continues. The cumulative penalty may extend only up to 5% of the cost of the relevant plot, apartment or building in the project for which the agent facilitated the transaction, as determined by the Authority. The ceiling is not necessarily 5% of the entire project cost.

Illustration: For an apartment with a relevant determined cost of Rs 50 lakh, 5% is Rs 2.5 lakh. At Rs 10,000 per day, the daily calculation reaches that ceiling after 25 days. This is an illustration of the statutory formula, not a determination in any individual proceeding.

Practical compliance checklist

Check whether the project requires registration under RERA and whether the agent has valid registration with the competent Authority.
Use the assigned registration number and observe applicable renewal and disclosure requirements.
Maintain prescribed records and provide relevant project and transaction information to prospective buyers.
Avoid prohibited unfair trade practices and facilitating transactions in projects that must be, but are not, registered.
On receipt of a notice from the Authority, examine the alleged breach, applicable rules and dates of default, and respond within the specified period.

Sections 9 and 10 establish registration and conduct obligations for real estate agents. Section 61 addresses other contraventions by promoters. Section 65 concerns failure by a real estate agent to comply with orders or directions of the Authority; Section 66 concerns non-compliance with Appellate Tribunal orders.

Frequently asked questions

Does Section 62 apply to promoters?

No. Section 62 specifically addresses real estate agents. Promoter-related contraventions are governed by other provisions, including Sections 59 to 61, depending on the breach.

Is the penalty automatically 5%?

No. Section 62 specifies Rs 10,000 for each day of continuing default, with a cumulative maximum of 5% of the relevant property cost determined by the Authority.

Can a real estate agent be penalised for breaching duties after registration?

Yes. Section 62 covers violations of both Section 9 (registration) and Section 10 (functions and duties).

Official legal resources

Read the Real Estate (Regulation and Development) Act, 2016 on India Code and consult the Ministry of Housing and Urban Affairs. State and Union Territory RERA rules and the relevant Authority's orders should also be considered for specific compliance requirements.