TL;DR
- Section 3 of the Real Estate (Regulation and Development) Act, 2016 requires registration before any advertising or sale where the land proposed to be developed exceeds 500 square metres, or where more than eight apartments or plots are proposed, whichever applies.
- A plotted development carrying infrastructure obligations is a real estate project. Sale of raw land with no development obligation is different, and that distinction is where promoters argue.
- Each phase is a separate real estate project and needs its own registration. A registration number for phase one says nothing about the plot you are being sold in phase two.
- Under section 13, a promoter cannot accept more than ten per cent of the cost of the plot as an advance or application fee without first entering into a registered agreement for sale.
- Under section 4(2)(l)(D), seventy per cent of the amounts realised from allottees must go into a separate account, to be used only for that project’s land and construction cost.
- Section 18 gives the allottee a right to withdraw with refund and interest, or to continue and take interest for delay, if the promoter fails to complete or hand over by the agreed date.
- Penalty for developing without registration can run to ten per cent of the estimated project cost, with imprisonment for continued breach.
A plotted development with roads, drainage, water lines and a completion promise is a real estate project, and if it crosses the section 3 thresholds it cannot be advertised or sold before it is registered. The belief that a MahaRERA plotted project is somehow outside the regime is the single most useful misunderstanding a weak promoter has, because it removes the escrow, the agreement, the timeline and the remedy all at once.
When registration is required
Registration under section 3(1) is required before any marketing, advertising or sale where any one of the triggers is met. The thresholds are not cumulative in the way people assume, and the exemption is narrower than the trigger.
| Position | Requirement |
|---|---|
| Land proposed to be developed exceeds 500 sq.m | Registration required |
| More than eight apartments or plots proposed | Registration required, whatever the land area |
| Project without a valid occupancy certificate, still selling inventory | Registration required |
| Each phase of a phased development | Treated as a separate project, each needing its own registration |
| Exemption | Only where the area is under 500 sq.m and there are not more than eight units. Both limbs must be satisfied |
The phasing point deserves emphasis because it is where plot buyers are most often misled. A promoter can hold a genuine registration for a first phase and sell plots from an unregistered second phase alongside it, on the same site, under the same name, using the same signboard. The registration number on the brochure has to be checked against the specific phase in which your plot sits.
The raw land argument
The counter-position a promoter will run is that this is a sale of land, not a development, and land is outside RERA. That argument has a real basis where nothing is being promised: a survey number is conveyed, the buyer takes it as it is, and there is no obligation on the seller to do anything to it.
It collapses the moment infrastructure obligations enter. Internal roads, storm-water drains, a water line, street lighting, a gate, a compound wall, common open space, an amenity plot, a completion date. Each of those is a development obligation, and a promoter who has taken money against them has sold a real estate project. The test is what has been promised, not what the document has been titled.
The three protections a plot buyer loses without registration
This is the part worth internalising, because registration is not paperwork. It is the mechanism that delivers three specific protections.
- The ten per cent rule, section 13. A promoter cannot accept more than ten per cent of the cost of the plot as an advance or application fee without first entering into a registered agreement for sale. Where a buyer has paid forty per cent against a booking form and an allotment letter, that rule has been broken and there is no registered agreement setting out area, price, timeline or default consequences.
- The seventy per cent account, section 4(2)(l)(D). Seventy per cent of the amounts realised from allottees must be deposited in a separate account, to be used only for the land and construction cost of that project. This is what stops money from one project funding another promoter’s land purchase elsewhere, which is the single most common mechanism by which projects stall.
- The delay remedy, section 18. Where the promoter fails to complete or hand over by the agreed date, the allottee may withdraw and claim a refund with interest, or continue and claim interest for every month of delay. Without a registered project and a registered agreement carrying a date, there is nothing to be in breach of.
Plotted developments with infrastructure obligations do require registration.
Analysis of section 3 registration requirements under MahaRERA
What to check, and how
| Check | What good looks like | What to be wary of |
|---|---|---|
| Registration number on the MahaRERA portal | An active registration matching the project and the phase your plot sits in | A number that resolves to a different phase, a lapsed registration, or a number quoted only on paper |
| Promoter name | Matches the entity that will execute your agreement and the entity on the title | Three different names across brochure, agreement and 7/12 |
| Sanctioned layout on the portal | Plot numbering that matches what you are being shown on site | A marketing plan with plot numbers that do not appear in the sanctioned layout |
| Declared completion date | A specific date you can hold against section 18 | Soon, subject to approvals, or a date only in conversation |
| Quarterly progress updates | Filed and current | Nothing filed for several quarters on a project claimed to be moving |
| Amount demanded before agreement | Not more than ten per cent | A booking demand well above ten per cent against an allotment letter |
| Litigation disclosed | Listed on the portal | Encumbrances you find yourself that are not disclosed |
Do these in this order, because the first two dispose of most problems in ten minutes and the rest are only worth doing if the first two hold.
Registration is not a quality certificate
An honest article has to say this. A MahaRERA registration number tells you the promoter has made declarations to a regulator, that a separate account exists, and that a completion date has been committed. It does not tell you the title is clean, that the layout was properly sanctioned, that the land is free of the tenure restrictions discussed elsewhere on this site, or that the promoter can deliver.
Registration is a floor. A registered project with a defective title is still a defective title, and the regulator does not adjudicate that for you before granting registration. Run the title work regardless.
What non-registration actually costs the promoter
Where a project that required registration was developed or sold without it, the penalty can extend to ten per cent of the estimated cost of the project, with imprisonment available for continued contravention. That is worth knowing not because a buyer wants to prosecute anyone, but because it explains behaviour. A promoter who has taken your money outside the system has an incentive to keep you outside it, and that shows up as reluctance to execute a registered agreement.
Frequently asked questions
Does RERA apply to plots or only to flats
It applies to plots. A plotted development with infrastructure obligations is a real estate project and requires registration where the section 3 thresholds are met.
What is the registration threshold for a plotted project
Registration is required where the land proposed to be developed exceeds 500 square metres, or where more than eight plots or apartments are proposed. The exemption applies only where both limbs are satisfied.
Is each phase registered separately
Yes. Each phase is treated as a separate real estate project with its own registration, so the number on the brochure must be checked against the phase your plot is in.
How much can a promoter take before the agreement for sale
Not more than ten per cent of the cost of the plot, under section 13. Beyond that a registered agreement for sale must be executed first.
What is the seventy per cent account
Under section 4(2)(l)(D), seventy per cent of amounts realised from allottees must be kept in a separate account and used only for the land and construction cost of that project.
What can I do if the plot is not handed over on time
Section 18 lets the allottee withdraw and claim a refund with interest, or continue and claim interest for the period of delay, where the promoter fails to complete or hand over by the agreed date.
Does a MahaRERA number mean the title is clean
No. Registration records declarations to a regulator. It is not a title certificate, and full title due diligence remains necessary.
Being sold a plot in a phase you cannot find on the portal? That is the check to finish before the booking amount, not after. We verify registration, phase and layout against what is actually on site.
Related reading
- Section 45(5A) and 54F: The Landowner Tax Playbook on a JDA and a Land Sale
- Buying Land as an Individual, HUF, LLP or Private Limited Company
- Plot possession delays and RERA compensation rights
- What is a branded plotted development
- How to evaluate a real estate developer in India
- Sale deed vs agreement to sale
- 12 red flags to check before you buy a plot in MMR
Citations and sources
- Real Estate (Regulation and Development) Act, 2016, section 3 — registration of real estate projects, the 500 square metre and eight unit thresholds, phase-wise registration and the exemption. See this analysis of section 3 registration
- Real Estate (Regulation and Development) Act, 2016, section 13 — no more than ten per cent as advance without a registered agreement for sale
- Real Estate (Regulation and Development) Act, 2016, section 4(2)(l)(D) — seventy per cent of realisations to a separate account
- Real Estate (Regulation and Development) Act, 2016, section 18 — refund with interest or interest for delay
- Real Estate (Regulation and Development) Act, 2016, section 59 — penalty up to ten per cent of estimated project cost for non-registration
