Realtors irked over financial body status
Feb 18, 2014
Source : The Times of India


BHUBANESWAR: Registration of houses, as required after sale, has come to a grinding halt in the state following a recent government order putting realtors in the bracket of financial establishments.

The order mandates the builders to submit their financial transaction details periodically to the government under the Odisha Protection of Interests of Depositors (in Financial Establishments) Act 2011. The realtors are opposed to it, terming the order a wrong interpretation of the Act.

The economic offences wing (EOW) of the crime branch on January 18 issued instructions to the district sub-registrars to ensure that financial establishments, including real estate companies, submitted their financial position and investment details on a quarterly basis to the district collectors and SPs, as specified under Rule 9 of the Act. "You are requested to ensure that financial establishments, which also include real estate companies, have complied with Rule 9 before allowing any registration/sale/purchase of land/flats/apartments," EOW DIG Rajesh Kumar wrote to the district sub-registrars.

According to Rule 9 (Filing of Report and Return by the Financial Establishment), "Every financial establishment shall furnish, within one month of the expiry of each quarter of a financial year, a return showing particulars in respect of its business including its financial position, the area of its investments and the location made by it within and outside the state, to the collector and SP within whose jurisdiction his place of business is located."

The Act is silent on whether real estate developers fall under the purview of financial establishments.

While sub-registrars are insisting on such particulars, realtors are saying they are not financial establishments, which has resulted in the deadlock for the past several days. Transactions relating to registration of any immovable properties by the builders have been stopped by the sub-registrar offices thanks to the EOW's January 18 circular.

"A realtor who develops land, after being duly approved by the development authority, can't be termed financial establishments. The Act has nowhere described housing developers as financial establishments. Defined activities of builders are not in the ambit of a similar law in any other state," said Pradipta Biswasroy, president, Real Estate Developers' Association of Odisha (Reda).

Reda on Monday submitted a memorandum to the EOW against its order. Despite attempts, the EOW DIG could not be contacted for comment.





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