NEW DELHI: The Uttar Pradesh Real Estate Regulatory Authority (UP-RERA) has notified amendments to the UP-RERA General Regulations, 2019, introducing a framework for collection, management, transfer and utilisation of Interest Free Maintenance Security funds.
The 12th amendment has been inserted under Regulation 47 and will come into force from the date of publication on the authority’s website.
Under the amended regulations, promoters will be required to collect IFMS from allottees at the time of registration of sale, lease or sub-lease deed and deposit the amount in a separate designated account opened with a scheduled bank.
The collected funds will have to be invested in the highest interest-bearing fixed deposit after obtaining quotations from eligible banks.
The authority has also prescribed IFMS rates based on the nature, size and category of projects.
For multi-storey group housing projects, the rates range from ₹20 to ₹100 per sq ft, depending on the category of the dwelling unit.
In commercial projects, IFMS has been fixed at ₹40 per sq ft for non-central air-conditioned projects and ₹50 per sq ft for central air-conditioned projects. Separate rates have also been prescribed for plotted residential and plotted commercial developments.
The amendment makes it mandatory for promoters to transfer the entire IFMS corpus to the Residents’ Welfare Association or Association of Allottees at the time of handing over common areas.
Promoters will also have to provide a detailed transfer statement, including unit-wise IFMS collections, expenditure details, audit trail and the final balance being transferred.
The regulations state that the IFMS corpus can be used only for operation, maintenance, repair and replacement of common areas, equipment and services meant for the collective benefit of residents.
The funds must be maintained in a separate account, distinct from other maintenance receipts.
The RWA or association will be required to maintain books of accounts reflecting all receipts, payments and utilisation of IFMS funds.
The utilisation of the corpus must be audited by a chartered accountant, and the audit report must be placed before the annual general meeting or extraordinary general body meeting within three months of its finalisation.
Sanjay R Bhoosreddy, chairman, UP-RERA, said the objective of the amendment is to ensure transparency, accountability and financial discipline in the management of IFMS funds.
“Homebuyers contribute these funds for the long-term upkeep of common facilities, and it is essential that the corpus remains secure and is utilised only for its intended purpose,” he said.
He added that the reform will strengthen the role of RWAs and promote better maintenance and sustainable management of real estate projects across Uttar Pradesh.
