The Indian government on Tuesday extended the reach of a law to regulate the real estate sector and curb undeclared “black money” in property markets that costs the treasury billions of dollars in lost taxable income not to mention cause unnecessary headaches for millions of homebuyers.
The decision by Prime Minister Narendra Modi’s government to amend the bill, which was submitted by the previous government in 2013 but not passed by the Rajya Sabha, aims to boost investor confidence and stamp out illegal practices in the real estate sector.
“The bill seeks to ensure accountability and transparency, which will in turn enable the real estate sector to access capital and financial markets essential for its long-term growth,” the government said in a statement.
The amendments approved by the cabinet will bring tougher regulation to consumer protection rules to commercial as well as residential real estate.
Vendors in India’s real estate market often demand part payment in illicit cash, making many ordinary people party to corruption and excluding some of the emerging middle class from the market.
The new set of laws will allow buyers to approach consumer forums in case of disputes with real estate developers, who will have to disclose all information about the project and comply with funding rules, an official said after the cabinet meeting.