RERA Disclosures Every Real Estate Developer Must Know

By LegalInk Editorial · 2026-05-17

RERA Disclosures Every Real Estate Developer Must Know

Non-disclosure and delayed disclosure remain among the most commonly cited grounds for complaints filed before Real Estate Regulatory Authorities across states. Yet many developers — particularly those managing mid-sized residential or mixed-use projects — continue to treat RERA compliance as a one-time registration exercise rather than a continuing obligation. This post sets out the full scope of mandatory disclosures under the Real Estate (Regulation and Development) Act, 2016, covering what must be disclosed at registration, what must be updated through the project lifecycle, how the escrow mechanism interacts with disclosure obligations, what agent registration requires, and what enforcement looks like when any of these go wrong.

Project Registration and the Disclosure Trigger

The registration obligation is the starting point. Under Section 3 of the RERA Act, no promoter may advertise, market, book, sell, or offer for sale any plot, apartment, or building in a real estate project unless the project is registered with the appropriate state authority. The registration threshold covers projects where the land area exceeds 500 square metres or the number of apartments exceeds eight, inclusive of all phases. Phased development does not escape the threshold — each phase is treated as a standalone real estate project requiring its own registration.

A common error in mid-sized developments is to begin "soft launches" or expression-of-interest collections before registration is granted, on the assumption that no booking amount has technically been received. The Act does not draw that distinction. Section 3 captures advertising and offering for sale, not merely accepting consideration. State authorities have repeatedly held that pre-launch campaigns conducted before registration attract penalty under Section 59, even where no money changed hands.

What Registration Actually Requires You to Disclose

Registration is not merely a filing. Section 4 of the Act requires the promoter to submit a detailed disclosure package at the point of registration. This includes:

• Authenticated copies of all approvals and commencement certificates obtained from competent authorities
• The sanctioned plan, layout plan, and specifications of the proposed project
• Plan of development works, proposed facilities, and amenities
• Location details including the address of the project and the district
• Proforma of the allotment letter, agreement for sale, and the conveyance deed that the promoter proposes to execute with the allottees
• Number, type, and carpet area of apartments for sale, along with the area of the exclusive balcony or verandah and the exclusive open terrace
• Names and addresses of real estate agents engaged for the project
• Names and addresses of contractors, architects, structural engineers, and other professionals associated with the project
• Declaration regarding title to the land, supported by an authenticated copy of the legal title deed
• Details of encumbrances on the land, if any, including any rights, title, interest, or dues

The declaration under Section 4(2)(l) is particularly important. The promoter must declare that the land is free from all encumbrances, or if there are encumbrances, disclose them fully. A promoter who makes a false declaration is exposed to liability not only under the RERA Act but also under Section 318 of the Bharatiya Nyaya Sanhita — the cheating provision that replaced IPC Section 420 — where the false declaration induces an allottee to part with money.

The same logic extends to disclosures around joint development agreements. Where the promoter holds development rights rather than freehold title, the JDA terms, profit-sharing ratios, and the landowner's share of units must be reflected in the registration filings. Allottees purchasing landowner-share units have, in several states, successfully argued that an undisclosed JDA structure amounts to suppression of material fact.

Ongoing Website Disclosure Under Section 11

Registration creates a continuing obligation under Section 11. The promoter must maintain a dedicated webpage on the authority's website — most state RERAs now integrate this with their public portal — and update it quarterly. The quarterly update must reflect:

• The number and type of apartments or plots booked
• The status of approvals obtained and pending
• Progress of construction against the declared timeline
• Status of the common areas and facilities
• Progress of project development works

Failure to update is treated as a disclosure violation and attracts penalties under Section 61 of the Act. In practice, the quarterly disclosure is also the document most often relied on by complainants. When a buyer files a Section 31 complaint alleging delayed possession, the first document the adjudicating officer typically asks for is the QPR (Quarterly Progress Report) history. A clean QPR trail that flags slippage early is, paradoxically, a better defence than an unblemished record that diverges from on-ground reality.

The Escrow Obligation: Disclosure and Compliance

The 70 percent escrow rule is among the most consequential — and most misunderstood — provisions of the Act. Section 4(2)(l)(D) requires the promoter to deposit 70 percent of the amounts realised from allottees in a separate designated account maintained in a scheduled bank. The amount is to be used only for the cost of construction and the land cost.

What the Escrow Rule Requires in Practice

The escrow obligation creates an implicit disclosure requirement. The promoter must disclose to allottees that the designated account exists and that withdrawals from it are linked to certified construction progress. The promoter cannot withdraw from the designated account without first obtaining a certificate from an engineer, an architect, and a chartered accountant in practice certifying the percentage of completion of construction.

Three points are routinely misunderstood. First, the 70 percent applies to amounts realised from allottees of that particular project, not to the developer's overall cash position — there is no netting against other projects. Second, the "land cost" component, once recovered, cannot be re-applied; the designated account is not a revolving facility. Third, the tripartite certification (engineer, architect, CA) is conjunctive, not in the alternative — withdrawal on the strength of only a CA's certificate is non-compliant.

Several state authorities — Maharashtra, Karnataka, and Telangana among them — have elaborated on this requirement through state rules. MahaRERA's Order No. 30/2022 prescribes the form of CA certification; Karnataka and Tamil Nadu have similar formats. Developers must check the operative state rules in addition to the central Act. The percentage disclosed at registration must be consistent with the state rule in force, not simply stated as "70 percent" if the state has prescribed a different figure.

Consequences of Escrow Mismanagement

Diverting funds from the designated account is treated as a serious violation. Under Section 18, allottees are entitled to a refund with interest if the promoter fails to complete or is unable to give possession. If misuse of the escrow is established, the promoter can face prosecution under Section 65 of the Act, which provides for imprisonment of up to three years, a fine, or both. Regulatory authorities in several states have levied substantial penalties in cases where promoters withdrew from the designated account without the required certificates, and in egregious cases have directed attachment of project bank accounts.

Developers using our real estate compliance framework can generate a quarterly escrow certification checklist aligned with the state-specific rules applicable to their project.

Mandatory Disclosures to Allottees

Beyond what is filed with the authority, the Act specifies what must be disclosed directly to allottees before and after booking.

Pre-Sale Disclosures

Under Section 12, the promoter is bound by every advertisement, prospectus, or communication made to the public. If a buyer relies on any statement made in an advertisement and suffers loss because the statement was untrue, the promoter is liable to compensate. This makes every marketing document — including brochures, hoardings, microsites, social media posts, and even WhatsApp broadcasts sent by sales teams — a formal disclosure instrument. Developers should maintain a versioned archive of every public communication tied to a registered project, because the marketing material in circulation on the date of a buyer's booking is the document the authority will compare against the eventual delivery.

Before executing an agreement for sale, the promoter must share with the prospective allottee all information that the allottee is entitled to know, including:

• Sanctioned plans and approvals obtained
• Completion timeline
• Carpet area — the Act is specific that sale must be on the basis of carpet area, not super built-up area
• Specifications of the apartment including fittings, fixtures, amenities, and common areas

Developers should be careful about representations regarding amenities such as clubhouses, swimming pools, or landscaped gardens. Under Section 14, the promoter cannot make any addition or alteration in the sanctioned plan or the specifications and amenities agreed upon with allottees without their written consent. Where an alteration is structural and affects more than two-thirds of allottees, consent from at least two-thirds of allottees is mandatory. A frequent litigated issue is the substitution of brand-named fittings — for instance, "Kohler or equivalent" being interpreted by buyers as a guarantee of the named brand. Generic substitution clauses do not override Section 14 if specific brands were advertised.

Agreement for Sale as a Disclosure Document

The agreement for sale under Section 13 is itself a disclosure mechanism. The promoter cannot accept more than 10 percent of the cost of the apartment, plot, or building as an advance before executing a written agreement for sale and registering it. The agreement must include:

• The carpet area of the apartment
• The total price payable
• The schedule of payment
• The project completion date
• The rate of interest payable by both parties in case of default
• The obligation of the promoter to execute a conveyance deed after obtaining the occupancy certificate

The reciprocal interest clause is worth flagging. Section 18 read with state rules typically prescribes that the interest rate payable by the promoter for delay must be the same as the rate at which the allottee is charged for default — usually pegged to the State Bank of India's marginal cost of lending rate plus a margin. Asymmetric default clauses that charge allottees 18 percent while capping promoter liability at 9 percent are routinely struck down as contrary to Section 13.

Our sale deed drafting tool includes RERA-compliant templates that incorporate these mandatory disclosures and can be adapted to the state-specific rules applicable to the project.

Real Estate Agent Registration and Agent-Specific Disclosures

The RERA Act extends registration and disclosure obligations beyond promoters to real estate agents. Section 9 prohibits any person from acting as a real estate agent in connection with any registered real estate project without first registering with the relevant state authority.

What Agent Registration Requires

An agent registering under Section 9 must disclose:

• Name, address, and type of enterprise (individual, firm, company, or other)
• Particulars of registration under any other law currently in force — for example, GST registration
• Details of any disciplinary proceedings initiated by any authority against the agent in the past five years
• Authenticated copies of proof of address and identity

The registration is valid for a period as prescribed by state rules, and renewal requires fresh disclosure. Some states have introduced digital registration portals that require agents to upload documents in a prescribed format, and a few — notably Maharashtra — have made completion of a certified training and examination a precondition to renewal.

Ongoing Agent Disclosure Obligations

Under Section 10, a registered agent has continuing obligations. The agent must maintain and preserve books of accounts and records and documents relating to each transaction for a period as prescribed by the authority. The agent must not facilitate any transaction in respect of a project that is not registered under Section 3. If an agent facilitates a sale in an unregistered project, both the agent and the promoter face penalties.

Agents must also disclose to allottees all information about the project that is available on the authority's public portal. Withholding material information, or misrepresenting project status to a buyer, creates liability for the agent independently of any liability of the promoter. This independent liability is significant: an agent cannot, in defending a complaint, take refuge in the position that they merely relayed what the promoter told them. The statutory duty runs from the agent directly to the allottee.

Penalties and Enforcement: What Non-Disclosure Costs

The enforcement mechanism under RERA is worth understanding clearly before treating disclosure obligations as administrative formalities.

Promoter Penalties

Under Section 59, a promoter who fails to register a project is liable to a penalty of up to 10 percent of the estimated cost of the project. If the promoter provides false information or contravenes any provision of Section 4, the penalty is also up to 5 percent of the estimated cost. Continued non-compliance after an authority order attracts imprisonment of up to three years, or fine, or both under Section 65.

Under Section 61, contravention of any order or direction of the authority — including directions to update website disclosures — attracts a penalty of up to 5 percent of the estimated project cost. The "estimated cost of the project" denominator is calculated on the project's declared cost at the time of registration, not on the promoter's profit margin, which is why even modest projects can attract penalties running into several crores.

Agent Penalties

Under Section 62, an agent who fails to register, or who violates any provision of Section 10, is liable to a penalty of up to ten thousand rupees per day during the period of default, subject to a ceiling of 5 percent of the cost of the plot, apartment, or building for which the sale was facilitated.

Concurrent Remedies for Allottees

Section 31 allows any aggrieved person — including allottees, associations of allottees, and any voluntary consumer association — to file a complaint with the authority. The authority's adjudicating officer has powers to direct compensation, interest payments, and refunds. The remedy is independent of consumer forum proceedings, though Section 79 bars civil court jurisdiction for matters falling within the authority's purview. The Supreme Court in Imperia Structures Ltd. v. Anil Patni clarified that RERA does not displace the Consumer Protection Act — allottees retain the option of approaching consumer commissions, and developers must therefore plan disclosure documentation with both forums in mind.

Appeals from the authority lie to the Real Estate Appellate Tribunal under Section 43, with a further appeal to the High Court on questions of law under Section 58. A promoter intending to appeal an adjudicating officer's order directing refund must deposit not less than thirty percent of the penalty or the amount payable to the allottee — a pre-deposit requirement that has, in practice, deterred frivolous appeals and accelerated settlement.

Why This Matters

The cumulative effect of RERA's disclosure architecture is that developers are now legally bound to a standard of transparency that was, for most of Indian real estate's history, aspirational at best. Each layer — project registration, escrow certification, pre-sale communication, agreement for sale, agent registration, quarterly progress reporting — generates a documented record against which the promoter's conduct can be measured. State authorities are increasingly data-driven, and the public portals in Maharashtra, Karnataka, and Uttar Pradesh allow allottees to track project status in real time. A developer whose portal disclosures are inconsistent with actual construction progress is exposed to complaints well before the disclosure lapse hardens into a financial dispute. Treating RERA disclosures as a continuing compliance programme rather than a paperwork burden is, at this point, a commercial necessity as much as a legal one. Teams looking to systematise this workflow can start with the real estate compliance framework at legalink.co.in and use the sale deed drafting tool to ensure transaction documents meet the mandatory disclosure standard under Section 13.

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