RERA Penalty for Agents: What Real Estate Agents Must Know
Real estate agents often assume that RERA compliance is primarily the responsibility of the builder or developer.
That assumption can be costly.
A recent action by the Telangana Real Estate Regulatory Authority (TG RERA) demonstrates that real estate agents can face regulatory action when they facilitate the sale or marketing of property in a project that has not obtained the required RERA registration.
The case involved the Amber Homes project at Mucherla village in Rangareddy district, Telangana, where TG RERA found that agents had facilitated transactions in an unregistered project. The Authority directed proceedings for penalties against the concerned agents under Section 62 of the Real Estate (Regulation and Development) Act, 2016.
What happened in the Amber Homes case?
The matter arose from a complaint concerning the sale of plots in the Amber Homes project.
The complainant stated that he had agreed to purchase a 1,000-square-yard plot and had paid approximately ₹1.17 crore, including registration-related charges.
According to the proceedings, 500 square yards were registered in his favour in February 2024, while registration of the remaining portion was delayed.
During the proceedings, TG RERA examined the role of the landowner, developer and real estate agents involved in marketing and facilitating transactions in the project.
RERA found that the project required registration
The Authority concluded that Amber Homes constituted a real estate project and that transactions were being facilitated without the mandatory registration contemplated under Section 3(1) of RERA.
The landowner/developer was directed to stop further advertising, marketing and sale of plots until the project was registered.
More importantly for real estate agents, the Authority separately examined the conduct of the individuals who facilitated the transactions.
Real estate agents can also face RERA penalties
The Authority found that two individuals had violated their obligations under Section 10(a) by facilitating transactions in the unregistered project.
Proceedings were directed for imposing penalties under Section 62.
One individual was additionally declared a defaulter for alleged misrepresentation and unfair conduct after presenting himself as a vendor/developer despite his status as a registered real estate agent.
This is a significant compliance warning for brokers and channel partners.
Having a RERA registration as an agent does not give an agent permission to market every property.
The agent must also ensure that the project being marketed falls within the applicable legal framework and that the required project registration is in place.
What does Section 10 require from a real estate agent?
Section 10 of RERA lays down important functions and duties of registered real estate agents.
Among other things, an agent must not facilitate the sale or purchase of a property in a project that is not registered with the Authority when registration is required.
The agent is also expected to maintain records and avoid unfair trade practices.
This means RERA compliance is not simply:
“Get your agent registration certificate and start selling.”
It is an ongoing compliance responsibility.
What is the penalty for an unregistered real estate agent?
Section 62 provides that where a real estate agent contravenes Sections 9 or 10, the Authority can impose a penalty of ₹10,000 for every day during which the default continues, subject to a cumulative limit prescribed by the Act.
Therefore, an agent facilitating transactions without satisfying the applicable RERA requirements can face a financial penalty in addition to reputational and regulatory consequences.
The exact penalty in an individual case depends on the facts, the applicable State rules and the Authority’s order.
Can a registered agent market an unregistered project?
Not where the project is required to be registered and has not been registered.
This is one of the most important compliance checks a real estate agent should perform before accepting a mandate.
A developer may say:
- “Registration is under process.”
- “The project is old.”
- “It is only a plotted development.”
- “The land is already approved.”
- “The project is exempt.”
- “The RERA number will come shortly.”
- “You can start marketing now and registration will be completed later.”
An agent should not rely solely on such verbal assurances.
The legal position must be independently verified.
Why “RERA registration is under process” is not enough
The distinction between registration obtained and registration applied for is crucial.
Where registration is mandatory, marketing, booking or sale before registration can expose the promoter to action under RERA.
The agent can also become exposed if the agent knowingly facilitates a transaction contrary to the requirements applicable to registered projects.
The safest approach is to verify the project directly on the relevant State RERA portal and retain documentary evidence of the verification.
What should a real estate agent verify before marketing a project?
Before onboarding a new project, an agent should ideally maintain a RERA compliance checklist.
1. Verify the RERA registration
Check:
- RERA registration number
- Registered promoter
- Project name
- Project address
- Registered land details
- Registration validity
- Project completion date
- Registered phases/towers/blocks
- Any extension of registration
2. Verify the inventory being marketed
The property being offered should correspond with the project and phase actually covered by the RERA registration.
3. Verify the promoter’s marketing material
Brochures, websites, advertisements and digital campaigns should not contain representations that contradict the registered project information.
4. Verify your own agent registration
Ensure that your RERA agent registration is valid in the relevant State and that renewal requirements are followed.
5. Maintain records
Keep copies of:
- project RERA certificate;
- authority letters;
- marketing approvals;
- inventory sheets;
- booking forms;
- advertisements;
- buyer communications; and
- relevant correspondence with the developer.
Why this matters even more for channel partners
Modern real estate sales involve multiple parties:
Developer → Master Channel Partner → Sub-Broker → Individual Agent → Buyer
A compliance problem at the project level can therefore affect several participants in the sales chain.
An agent should not assume that responsibility automatically rests with the developer.
The bigger lesson from the TG RERA action
The Amber Homes matter sends a clear message:
RERA compliance is not only a builder’s responsibility. Real estate agents facilitating transactions have independent statutory obligations.
For agents, RERA registration should therefore be treated as a compliance system rather than a one-time certificate.
RERA Compliance Checklist for Real Estate Agents
Before marketing a project, ask:
Is the project registered?
Is the registration valid?
Does the registration cover the property being sold?
Is my agent registration valid?
Does the marketing material match the registered project details?
Am I maintaining proper transaction records?
If any answer is unclear, obtain professional RERA compliance advice before proceeding.
Final takeaway
A real estate agent’s role under RERA is not merely that of a salesperson.
It is a regulated activity.
The recent Telangana action demonstrates that agents facilitating transactions in unregistered projects can themselves face regulatory proceedings and penalties.
For agents, developers and channel partners, the cost of a compliance check is generally far lower than the cost of defending a regulatory violation.
RERAconsultants.com provides RERA registration and compliance assistance for real estate agents, builders, developers and landowners/collaboration projects.
Frequently Asked Questions
Is RERA registration mandatory for real estate agents?
Where an agent facilitates the sale or purchase of property in a project registered under RERA, registration requirements under Sections 9 and 10 apply, subject to the applicable State framework.
What is the penalty under Section 62 of RERA?
Section 62 provides for a penalty of ₹10,000 per day during the period of default, subject to the statutory cumulative limit.
Can an agent sell property in a project whose RERA registration is pending?
An agent should not facilitate marketing, booking or sale where RERA registration is legally required but has not yet been obtained.
Can a RERA-registered agent still face penalties?
Yes. Agent registration does not provide immunity from the agent’s continuing obligations under RERA.
Does RERA apply to plotted projects?
It can, depending on the nature of the project, applicable thresholds, State rules and exemptions. The project should be legally assessed rather than assumed to be exempt.
Legal Disclaimer: This article is intended for general information and compliance awareness only and does not constitute legal advice. RERA applicability, registration requirements and penalties can vary based on the State, project structure and facts of each matter.