Best Project Not Registered with RERA? Your Options Lawyer

Sometimes a buyer only discovers after paying that the project they booked isn't registered with RERA. Perhaps it was sold as a "pre-launch" with a special discount. Perhaps the sales team said registration was "in process". Perhaps it was a small plotted colony on the edge of the city where nobody mentioned RERA at all. Or it's an older project whose builder simply never registered it when the law came in.

If that's your situation, you have more protection than you might think. Selling an unregistered project that needs registration is one of the most serious violations under the Real Estate (Regulation and Development) Act, 2016, and buyers in such projects can still go to the authority. This page explains how to check registration, when a project needs it, what happens to a builder that sells without it, and what you can do.

The rule: no registration, no sale

Section 3 of the Act says that no promoter shall advertise, market, book, sell or offer for sale, or invite people to buy, any plot, apartment or building in a real estate project in a planning area without first registering the project with the state authority. That's a wide prohibition. It covers not just sale agreements but advertising, marketing and even inviting expressions of interest.

For projects that were already ongoing when the Act came into force and hadn't received a completion certificate, the builder had to apply for registration within three months of the Act's commencement.

The idea behind the rule is simple. Registration forces the builder to put its approvals, land title, layout plans, completion date and financial arrangements on public record before taking anyone's money. A buyer who books in an unregistered project has been denied that information.

When registration isn't required

The Act exempts some projects from registration. Under Section 3(2), registration isn't required where:

• the land proposed to be developed doesn't exceed 500 square metres, or the number of apartments proposed doesn't exceed eight, including all phases (states can reduce these thresholds);
• the promoter received a completion certificate for the project before the Act came into force; or
• the work is renovation, repair or redevelopment that doesn't involve marketing, advertising, selling or new allotment of any apartment, plot or building.

The explanation to Section 3 adds that where a project is developed in phases, each phase is treated as a stand-alone project and needs its own registration. Builders sometimes register Phase 1 and start selling Phase 2 without registering it. That's still a violation.

The small-project exemption is where most borderline cases arise. Builders occasionally split a larger development into several small parcels, each just under the threshold, to avoid registration. Authorities look at the substance. If the parcels are in reality one project, marketed together, sharing roads and facilities, the exemption may not apply.

How to check whether your project is registered

Every state authority runs a public website where you can search registered projects by name, promoter or registration number.

• Look up the project name, and also the promoter's company name, because projects are sometimes registered under a different name from the one used in marketing.
• Check the phase. Make sure the registration covers the tower or phase you booked in, not just an earlier phase.
• Check the dates. The registration shows its validity and the declared completion date. A registration that has lapsed and not been extended is a problem in itself.
• Check the documents. Registered projects usually upload approvals, layout plans and quarterly progress updates. These tell you a great deal about the project.
• Look at the registration number on your documents. Your allotment letter, agreement and the builder's advertisements should all quote the RERA registration number. If they don't, ask why.

If you can't find the project, don't panic yet. Ask the builder in writing for its registration number. Its answer, or its silence, is useful evidence.

Pre-launch bookings and "expressions of interest"

A common practice in the NCR, especially before 2017 but still seen today, is the soft launch or pre-launch. Buyers are invited to pay a "token" or an "expression of interest" amount, often lakhs of rupees, for priority allotment in a project that hasn't been registered or sometimes hasn't even received building plan approval. The pitch is a discount for early buyers.

Under Section 3, inviting people to purchase in an unregistered project is prohibited, and collecting money against future allotment in such a project is a clear violation. Separately, Section 13 says a promoter can't accept more than 10% of the cost of the unit as an advance or application fee without first entering into a registered written agreement for sale. A large EOI payment collected without registration and without an agreement may breach both provisions.

If you've paid an EOI or token for a project that wasn't registered at the time, you're entitled to ask for it back, and the authority can take action against the builder.

What happens to a builder that sells without registration

Section 59 sets out the penalty. A promoter that contravenes Section 3 is liable to a penalty of up to 10% of the estimated cost of the real estate project, as determined by the authority. If the promoter doesn't comply with the authority's orders or continues to violate Section 3, it can be punished with imprisonment for up to three years, or with a further fine of up to another 10% of the estimated cost, or both.

That is a heavy penalty, and it applies regardless of whether any buyer complains. Authorities can act on their own when they come across unregistered projects being marketed, and several NCR authorities have issued public notices and penalty orders against builders advertising unregistered projects.

The penalty goes to the government, not to you. Your own remedies are separate, and that's where the complaint comes in.

Your remedies as a buyer

You are still an allottee

A buyer in an unregistered project is still an "allottee" under the Act. Builders sometimes argue that because the project isn't registered, RERA has no jurisdiction over it. Authorities have generally rejected that. It would be absurd if a builder could escape the Act by breaking its most basic rule. The authority's powers under the Act extend to projects that should have been registered.

Refund with interest

If you want out, you can usually claim a refund of everything you paid, with interest at the prescribed rate. Where the project was sold without registration, the builder's conduct itself supports the claim. Where it has also missed its possession date, Section 18 applies in the ordinary way.

Delay interest and possession

If you want the unit, you can ask the authority to direct the builder to register the project, comply with the Act, complete construction and give possession, along with interest for delay if the possession date has passed.

Directions to register

The authority can direct the builder to apply for registration and to disclose the information the Act requires. For buyers, registration brings the project under the authority's continuing supervision, with quarterly updates and the separate project account rule. That can be valuable even if the builder is eventually penalised.

Compensation

Where you've suffered losses, such as paying for a project that was never approved and losing years of the money's use, you can claim compensation before the adjudicating officer.

Projects that were registered late

A different situation arises where the builder sold units first and registered the project later, sometimes years later. In that case:

• the earlier sales were still in breach of Section 3 at the time they were made, and the authority can penalise that breach;
• the project is now under the authority's supervision, so your ordinary rights as an allottee apply; and
• the declared completion date in the late registration doesn't override the possession date in your agreement for the purposes of your delay claim.

Late registration is common for projects that were ongoing in 2017. Many of them registered within the three-month window, some registered months or years after, and some have never registered.

Plotted colonies, farmhouses and smaller projects

Outside the big group housing projects, buyers often deal with smaller plotted developments, "farmhouse" schemes, builder floors and low-rise projects. These are where unregistered sales are most common, and where the questions get technical.

• Plotted development is a real estate project under the Act, and plots are covered. A plotted colony above the size threshold needs registration.
• Builder floors, where a builder constructs three or four floors on a single plot and sells them separately, often fall below the eight-apartment threshold and may not need registration. Whether they do can depend on state rules and on whether the builder is developing several plots together.
• Planning area. Section 3 applies to projects in a planning area. Some projects on the outskirts sit in areas where planning permissions are themselves unclear, which raises separate problems about approvals and title.
• Agricultural land sold as "farmhouses" or as plots without conversion and approvals raises questions under land revenue and town planning laws, not only RERA.

If you're in one of these situations, the first job is to work out whether the project needed registration at all. If it did, the remedies above apply. If it didn't, your remedy may lie in consumer law, a civil suit or, where there's fraud, a criminal complaint.

Warning signs before you book

Most problems with unregistered projects can be avoided by asking a few questions before paying anything. If you're about to book, check these.

• Is the registration number on the brochure and the website? Advertisements of registered projects must carry it, along with the authority's website address. If the number is missing, ask why.
• Does the registration match the phase you're buying? Builders sometimes show the registration of an earlier phase.
• Is the token refundable, and on what terms? Get it in writing.
• Are you being asked for more than 10% before an agreement? If so, that breaches Section 13. Ask for a registered agreement for sale first.
• Is there a building plan approval? A registered project should have one, and it's usually uploaded on the RERA portal.
• Who owns the land? The registration should show this. If the land owner is a different company, understand the arrangement before you pay.
• Is the discount "only for today"? Pressure to pay immediately for a project with no visible registration is a classic red flag.

When the builder won't refund a token

Buyers who paid a token or EOI and later changed their minds, or discovered the project wasn't registered, often find the builder unwilling to return the money. Common responses are that the token was "non-refundable", that it's been "adjusted towards a unit", or that it will be refunded "after the unit is resold".

None of these is a good answer where the project wasn't registered when the money was taken. A "non-refundable" label doesn't make an unlawful collection lawful. If the builder later allotted you a unit without your agreement, that doesn't help it either. Write to the builder asking for the refund within a fixed period, and if it doesn't pay, file a complaint. The amounts in these cases are often smaller, but the principle is the same and authorities treat it seriously.

Projects that lose their registration

A related problem is a project whose registration lapses or is revoked. Registration is valid for the period the builder declared for completion, and can be extended under Section 6, normally by up to a year, in cases of force majeure or other reasonable circumstances where the builder wasn't at fault. If the builder doesn't get an extension, or the authority revokes the registration under Section 7 for serious violations, the project is left in limbo.

Section 8 gives the authority power, after lapse or revocation, to decide how the remaining work is to be completed, including by the competent authority or the association of allottees. For buyers, a lapsed registration is also a strong ground for a refund under Section 18, which specifically covers the situation where a promoter's business is discontinued because of suspension or revocation of registration. If your project's registration shows as lapsed on the portal, take advice promptly.

An illustration

A simplified, made-up example.

In 2022, a buyer saw a social media advertisement for a new group housing project on the Yamuna Expressway with a "launch offer". The sales office asked for Rs 5 lakh as an EOI for a 2BHK priced at Rs 55 lakh, and then, a month later, another Rs 6 lakh as "allotment money", without any agreement for sale. Neither the advertisement nor the receipts mentioned a RERA number. Eighteen months later, the project still wasn't on the UP RERA website, and the site was an empty plot.

The buyer has a strong case. The project was advertised and sold without registration, in breach of Section 3. The builder collected Rs 11 lakh, 20% of the price, without a registered agreement, in breach of Section 13. The buyer can seek a full refund with interest from the date of each payment, and the authority can separately penalise the builder under Section 59. If the broker who handled the sale wasn't registered, or facilitated a sale in an unregistered project, the authority can look at that too.

What registration gives you that you lose without it

It's worth understanding exactly what protections a buyer in an unregistered project has been denied, because they help explain why authorities take these cases seriously.

• Disclosure. A registered project's approvals, land title, layout, specifications and completion date are on public record. You can see what you're buying.
• The 70% account. Under Section 4(2)(l)(D), builders of registered projects must deposit 70% of the money collected from buyers in a separate account and use it only for the project's land and construction costs, withdrawing in proportion to progress, certified by an engineer, an architect and a chartered accountant.
• Quarterly updates. Section 11(1) requires the builder to update the project's page with progress every quarter.
• Plan protection. Section 14 stops the builder from changing sanctioned plans without consent.
• Supervision. The authority can step in, inspect, and issue directions in the interest of buyers.

A builder that skips registration skips all of these safeguards. That's why getting the project registered, or getting your money back, are both legitimate aims of a complaint.

Where to file

The complaint goes to the RERA authority of the state where the project is located, even if the project isn't on that authority's list. For NCR buyers that's UP RERA, Haryana RERA in Gurugram or Panchkula, or Delhi RERA. We file with copies of the advertisements and receipts, and ask the authority to examine the Section 3 violation alongside your individual relief.

Why acting early matters

Buyers in unregistered projects are often the most exposed of all, because there's no regulator watching where their money goes. The longer a builder runs an unregistered project, the more it can collect from new buyers, and the more likely it is that funds are spread across other projects or companies. If you've paid into an unregistered project and have doubts, the sensible order of steps is: check the registration today, write to the builder for its registration number and approvals this week, stop further payments until you have clear answers, and take advice before the builder asks for the next instalment.

If you're one of several buyers in the same position, talk to each other. A builder that ignores one buyer's letter may answer a joint letter from forty, and a joint complaint gives the authority a fuller picture of how the project was sold.

Agents selling unregistered projects

Real estate agents also have duties here. Under Section 9, agents must register with the authority before facilitating sales in registered projects, and Section 10 lists their duties, including not facilitating the sale of a unit in a project that isn't registered. If a broker sold you a unit in an unregistered project, the broker may also be liable to a penalty under Section 62, and the facts of how the sale was made may support your claim against the builder.

Keep the broker's business card, any WhatsApp messages and brochures they sent, and any receipt for brokerage. These sometimes show what was promised about registration and approvals.

How we handle these cases

1. Check the registration on the authority's website, by project name, promoter name and phase.
2. Check the exemptions: land area, number of units, completion certificate status, and whether the project is really one project split into parcels.
3. Write to the builder asking for its registration number and approvals, if it hasn't already been asked.
4. Collect the marketing material, since advertising an unregistered project is itself a violation.
5. File a complaint before the authority, seeking a refund or registration and possession as you prefer, with a request that the authority examine the Section 3 violation.
6. Pursue compensation where you've suffered losses.
7. Consider other remedies where the project falls outside RERA, or where there are signs of fraud.

Documents to gather

• Any receipt for the token, EOI or booking amount
• Application form, allotment letter or agreement, if any
• Brochures, advertisements, emails and messages from the builder or broker
• Payment proofs and bank statements
• Any written answer from the builder about registration
• Screenshots of your search on the RERA website

Frequently asked questions

Can I file a RERA complaint if the project isn't registered?

Yes. A buyer in a project that should have been registered is still an allottee, and the authority can hear the complaint and act against the builder for the violation.

What is the penalty for selling an unregistered project?

Under Section 59, up to 10% of the estimated cost of the project, and if the violation continues or orders are ignored, imprisonment of up to three years or a further penalty of up to 10%, or both.

I paid an EOI for a pre-launch. Can I get it back?

Generally yes. Inviting purchases and collecting money for an unregistered project breaches Section 3, and an advance of more than 10% without a registered agreement breaches Section 13. You can ask for a refund with interest.

The builder says registration is "in process". Is it safe to book?

Under the Act, the builder shouldn't be accepting bookings until registration is granted. "In process" isn't registration. Wait until you can see the registration on the authority's website.

My project is a builder floor. Does it need registration?

Often not, if it has eight or fewer units on land of 500 square metres or less, though state rules and the way the builder develops neighbouring plots can change the answer.

The builder registered the project after I booked. Does that help me?

It brings the project under the authority's supervision, which helps. It doesn't erase the earlier violation, and it doesn't change your contractual possession date.

Can I complain about the broker too?

Yes. Agents mustn't facilitate sales in unregistered projects, and the authority can penalise them under Section 62.

Does an unregistered project mean the builder is a fraud?

Not necessarily. Some builders were slow or careless. But an unregistered project means you haven't had the disclosures the law requires, so you should check approvals and title carefully before paying more.

General information on registration under Section 3 of the Real Estate (Regulation and Development) Act, 2016. Thresholds and exemptions can vary under state rules. Not legal advice.