RERA Project Audit & Utilisation Certificate

Real Estate (Regulation and Development) Act 2016: every commercial/residential project with area > 500 sq. m or >8 apartments must register with the state RERA authority before advertising or booking. Post-registration: quarterly updates of project status on the RERA portal (completion percentage, units sold, funds collected); annual Chartered Accountant's certificate on project finances by 30 September; and disclosure of any litigation, encumbrance, or material changes.

Section 4(2)(l)(D) RERA and Rule 3 of state RERA rules require an annual CA certificate certifying: (1) total funds received from allottees in the financial year; (2) funds deposited in the designated separate project account (Section 4(2)(l)(D) mandates 70% of funds be deposited in the separate account); (3) utilisation of funds — construction cost, land cost; (4) funds withdrawn from the account and for what purpose. Separate account adherence is the core certification.

70% of all amounts collected from allottees (for a specific project) must be deposited in a designated separate bank account — used only for that project's land acquisition and construction costs. The CA certifies compliance with this rule. Withdrawal is permitted only after certification by an engineer and CA of the work done proportional to the withdrawal. The remaining 30% can be used by the developer for other purposes (overhead, overheads, profit).

Section 60: failure to register before selling/advertising — penalty up to 10% of estimated project cost. Section 61: non-compliance with orders of RERA authority — penalty up to 5% of estimated project cost per day. Section 63: non-compliance with the adjudicating officer's orders — up to 5% of cost per day. Section 66: deliberate failure to comply with RERA — imprisonment up to 3 years (for developer, individual officers). Homebuyers can also seek refund with interest (Section 18) for delayed possession.

The CA prepares and certifies: (a) the annual RERA certificate on separate account utilisation; (b) project-wise quarterly financial progress for the RERA portal; (c) cost-to-complete estimates and reconciliation with collections; (d) audit of whether the 70% fund has been maintained and withdrawals properly certified. For projects nearing completion, the CA assists in preparing the audited cost statement that triggers RERA authority satisfaction and enables transfer to the owners' association.