Economic, Commercial and Intellectual Property Laws · Real Estate Regulation and Development Law

RERA 2016: Objectives, Applicability and Key Definitions

Updated 11 October 2026 · Fact-checked

The Real Estate (Regulation and Development) Act, 2016 regulates the real estate sector, makes sales transparent and protects buyers. To answer questions, state the provision, apply the definition (promoter, allottee, real estate project, carpet area, ongoing project) or the Section 3 exemption to the facts, and conclude clearly.

Understand RERA 2016: Introduction, Objectives and Key Definitions

Before RERA, buyers of flats and plots had little protection. Projects were delayed, plans changed and money was diverted. The Real Estate (Regulation and Development) Act, 2016 was passed to regulate and promote the real estate sector. It aims to make the sale of plots, apartments and buildings efficient and transparent, to protect the interests of consumers, and to set up a quick way to settle disputes through an Authority and an Appellate Tribunal.

The Act has a short title, extent and commencement clause. Under Section 1, it extends to the whole of India except the State of Jammu and Kashmir. A 2019 notification made it applicable to the Union territories of Jammu and Kashmir and Ladakh. The Central Government appoints the commencement date by notification, and different dates may be set for different provisions. In fact, some provisions (including Section 2 and Sections 20 to 39) came into force on 1 May 2016. Sections 3 to 19 came into force on 1 May 2017.

The Act is built on a few defined terms. A promoter is the person who builds or causes to be built, or develops land into a project, for sale. An allottee is the buyer: the person to whom a plot, apartment or building has been allotted, sold or otherwise transferred by the promoter. This includes a person who later acquires it by sale or transfer. It does not include a person who takes it on rent. A real estate project is the development of buildings with apartments, conversion of an existing building into apartments, or development of land into plots or apartments, for selling all or some of them, along with common areas and development works.

Two more terms matter for numbers and timing. Carpet area is the net usable floor area of an apartment. It excludes external walls, service shafts, exclusive balcony or verandah and exclusive open terrace areas. It includes the area covered by the internal partition walls. An ongoing project is one that was running on the date the Act commenced and had no completion certificate. Section 3 required such promoters to apply for registration within three months of commencement.

Applicability is tested through Section 3. No promoter may advertise, market, book, sell, offer for sale or invite people to purchase any plot, apartment or building in a project without registering it with the Real Estate Regulatory Authority. Some projects are exempt. Phases are treated as separate projects.

Key rules to remember

Objective of the Act: Regulate and promote the sector + transparent and efficient sales + protect consumers + adjudication and Appellate Tribunal; Use this four-part answer for any 'objectives of RERA' question.
Extent (Section 1): Whole of India except the State of Jammu and Kashmir; later extended to the UTs of Jammu and Kashmir and Ladakh by notification (2019); Commencement is by Central Government notification, and different dates may be fixed for different provisions.
Commencement dates: 1 May 2016: Section 2, Sections 20 to 39 and others. 1 May 2017: Sections 3 to 19 and others; Registration (Section 3) and the promoter's obligations in Sections 4 to 19 operate from 1 May 2017.
Carpet area: Carpet area = net usable floor area, including internal partition walls, excluding external walls, service shafts, exclusive balcony or verandah and exclusive open terrace; Remember: internal walls in, external walls out.
Registration bar (Section 3(1)): No advertise, market, book, sell, offer for sale or invite to purchase without registration; Applies to the project or any part of it, in any planning area.
Exemption from registration (Section 3(2)): Land ≤ 500 sq m OR apartments ≤ 8 (inclusive of all phases); completion certificate received before commencement; renovation, repair or re-development with no marketing, selling or new allotment; The appropriate Government may lower the 500 sq m or eight-apartment threshold.
Phases (Explanation to Section 3): Each phase = a stand-alone real estate project, registered separately; Often tested with a multi-phase facts question.
Ongoing project proviso: Ongoing on commencement + no completion certificate → apply for registration within 3 months of commencement; The three months run from commencement of the Act (the provision for registration).

How to solve RERA 2016: Introduction, Objectives and Key Definitions questions

Use this method for definition questions, applicability questions and short-note questions on the introduction to RERA.

1Identify the type of question: objectives, extent and commencement, a definition, or a registration-applicability problem.
2Write the provision in plain words first. For Sections 1, 3 and 4, give the section number. For definitions, give the term and say it is defined in the Act without a section number unless you are sure.
3List the facts that matter: who is selling, what is being sold, the land area, the number of apartments, whether a completion certificate exists, and whether the project is in phases.
4Match each fact to the definition or exemption. For example, check whether the person is a promoter, whether the buyer is an allottee (not a tenant), and whether the project falls within the exemption limits.
5Apply the Explanation on phases and the ongoing-project proviso where they are relevant.
6Do any calculation (such as carpet area) line by line, with a one-line label for each item.
7End with a clear conclusion: 'Hence registration is / is not required' or 'Hence X is an allottee / a promoter'.

Quickest way: Three-check approach for applicability questions

When to use it: Use it when the question gives facts and asks whether a project needs registration under RERA.

Check 1: Is any plot, apartment or building being marketed or sold? If not (for example, only repair work), no registration under Section 3(2)(c).
Check 2: Is the size within the limit: land not above 500 sq m, or apartments not above eight, inclusive of all phases? Either test is enough for exemption, but check if the State has lowered it.
Check 3: Was a completion certificate received before the Act commenced? If yes, exempt. If the project was ongoing without one, registration was required within three months of commencement.
Write the conclusion with Section 3.

Common mistakes in RERA 2016: Introduction, Objectives and Key Definitions

Counting internal partition walls out of carpet area, or counting external walls in.
Students mix carpet area with built-up area from sale brochures.
Fix: Remember: internal walls are included; external walls, service shafts, exclusive balcony or verandah and exclusive open terrace are excluded.
Treating a tenant as an allottee.
Both occupy the property, so they look alike.
Fix: The definition of allottee excludes a person to whom the plot, apartment or building is given on rent. A later buyer through sale or transfer is covered.
Saying the whole Act commenced on 1 May 2016.
Students remember only one date.
Fix: Different provisions commenced on different dates. Section 2 and Sections 20 to 39 on 1 May 2016, and Sections 3 to 19 on 1 May 2017.
Applying the exemption using both limits together (500 sq m AND 8 apartments).
Misreading the word 'or' in Section 3(2)(a).
Fix: The text says the land does not exceed 500 sq m or the apartments do not exceed eight, inclusive of all phases. Meeting either is enough, subject to any lower limit set by the appropriate Government.
Registering a multi-phase project once.
Students think of the project as one unit.
Fix: The Explanation to Section 3 says every phase is a stand-alone real estate project and must be registered separately.
Omitting the conclusion or the section number in the answer.
Students write the facts but forget the ICSI style.
Fix: Give the provision, apply it to the facts, then state the conclusion and cite Section 3 or Section 1 where relevant.

Worked examples

Example 1

Sundaram Builders plans to develop a residential project in Coimbatore on 450 sq m of land, with six apartments in one phase. It plans to advertise and sell the flats. Does it need to register the project with the Real Estate Regulatory Authority? Assume the State has not lowered the threshold.

Show the solution

Provision: Under Section 3(1), no promoter may advertise, market, book, sell or offer for sale any plot, apartment or building in a real estate project without registration.
Exemption: Section 3(2)(a) says registration is not required where the land does not exceed 500 sq m or the apartments do not exceed eight, inclusive of all phases.
Facts: The land is 450 sq m, which is within 500 sq m. The apartments are six, which is within eight. The project has a single phase.
Check: The appropriate Government can lower the limits, but we are told it has not done so.
Conclusion: The project meets the exemption conditions.

Answer: Registration is not required under Section 3(2)(a). If the State had reduced the threshold below these figures, the answer would change.

Example 2

An apartment has these measurements: living room 20 sq m, bedrooms 25 sq m, kitchen 8 sq m, bathrooms 6 sq m, internal partition walls 3 sq m, exclusive balcony 7 sq m, external walls 5 sq m, service shaft 2 sq m. Find the carpet area under RERA.

Show the solution

Rule: Carpet area is the net usable floor area, including the area covered by internal partition walls, and excluding external walls, service shafts, exclusive balcony or verandah and exclusive open terrace.
Include: living room 20 + bedrooms 25 + kitchen 8 + bathrooms 6 + internal partition walls 3.
Exclude: balcony 7, external walls 5 and service shaft 2.
Add the included items: 20 + 25 = 45; 45 + 8 = 53; 53 + 6 = 59; 59 + 3 = 62.

Answer: Carpet area = 62 sq m.

Exam tips

Learn the definitions of promoter, allottee, real estate project, carpet area and ongoing project in your own words, but keep every key condition (for example, rent is excluded from allottee).
For objectives, write four points: regulation and promotion, transparency and efficiency, consumer protection, and adjudication through the Authority and Appellate Tribunal.
In registration problems, always quote Section 3 and say whether the exemption or the ongoing-project proviso applies. State the conclusion in the last line.
Know both commencement dates (1 May 2016 and 1 May 2017) and the extent clause, including the later extension to Jammu and Kashmir and Ladakh.
Do not copy long definitions word for word from the Act. Write the rule clearly in short points and cite the section where you are sure of it.

Practice questions from Real Estate Regulation and Development Law

RERA 2016: Introduction, Objectives and Key Definitions: frequently asked questions

What is the difference between a promoter and an allottee under RERA?

A promoter is the person who builds, or causes to be built, or develops land into a project for sale. An allottee is the buyer to whom a plot, apartment or building is allotted, sold or otherwise transferred by the promoter. A person who takes it on rent is not an allottee.

What is carpet area under RERA?

It is the net usable floor area of an apartment. It includes the area under internal partition walls. It excludes external walls, service shafts, the exclusive balcony or verandah area and the exclusive open terrace area.

When did RERA 2016 come into force?

The Central Government notified different dates for different provisions. Section 2 and Sections 20 to 39 came into force on 1 May 2016. Sections 3 to 19 came into force on 1 May 2017.

Does every real estate project need RERA registration?

No. Section 3(2) exempts projects where the land does not exceed 500 sq m or the apartments do not exceed eight, inclusive of all phases. It also exempts projects that got a completion certificate before the Act commenced, and renovation or repair work with no marketing, selling or new allotment.

Is RERA applicable in Jammu and Kashmir?

Section 1 originally excluded the State of Jammu and Kashmir. A notification dated 30 October 2019 made the Act applicable to the Union territories of Jammu and Kashmir and Ladakh.