Pre-Launch Offer, EOI Cheque: What RERA Section 3 Means for Bengaluru Buyers Before They Pay
Section 3(1) of the RERA Act says a promoter shall not advertise, market, book, sell or invite purchases in a project in a planning area before registering it. This guide explains how that applies to pre-launch expression of interest offers in Bengaluru, the Section 3(2) exemptions, Section 59 penalties and the checks to run before paying.
The message arrives on a Friday evening: an exclusive pre-launch at a new Bengaluru address, priority allotment for the first hundred families, and a refundable expression of interest cheque of Rs 2 lakh to hold a place in the queue. There is a glossy deck, a price band per square foot, and a line saying RERA registration is in process. The question for the buyer is simple. Is it safe, or even allowed, to pay?
The Real Estate (Regulation and Development) Act, 2016 has a clear starting rule on this. Section 3 says a promoter shall not advertise, market, book, sell or offer for sale, or invite persons to purchase in any manner, any plot, apartment or building in a real estate project in a planning area without first registering the project with the regulator. This guide explains what that rule covers, the exemptions, the penalties, and the checks a Bengaluru buyer can run before handing over an EOI cheque.
The short answer. Under Section 3(1), registration comes before marketing, booking and inviting purchases, not after. Section 2(b) defines advertisement to include publicity in any form inviting persons to purchase or to make advances or deposits. Section 59(1) makes a promoter who contravenes Section 3 liable to a penalty up to ten per cent of the estimated cost of the project. The trade-off: a pre-launch may offer an early price, but money paid before registration is paid before the Act's project disclosures, agreement rules and complaint routes are attached to that project.
What does Section 3 actually prohibit?
Five activities, plus a catch-all. In the text of the Act published by the Telangana regulator, Section 3(1) says no promoter shall advertise, market, book, sell or offer for sale, or invite persons to purchase in any manner any plot, apartment or building, as the case may be, in any real estate project or part of it, in any planning area, without registering the real estate project with the Real Estate Regulatory Authority established under the Act.
The verbs are broad: advertise, market, book, sell, offer for sale. The phrase invite persons to purchase in any manner goes further, covering invitations that are not formal bookings. On the plain wording, a scheme that markets units and collects money to hold a place in an allotment queue sits close to these words. Whether a particular expression of interest scheme breaches Section 3 is for the Authority to decide on the facts.
The Act's definition of advertisement points the same way. Section 2(b) says advertisement means any document described or issued as advertisement through any medium and includes any notice, circular or other documents or publicity in any form, informing persons about a real estate project, or offering for sale of a plot, building or apartment or inviting persons to purchase in any manner such plot, building or apartment or to make advances or deposits for such purposes.
Which projects do not need registration?
Section 3(2) lists three exemptions. No registration is required where the area of land proposed to be developed does not exceed five hundred square metres or the number of apartments proposed to be developed does not exceed eight inclusive of all phases; where the promoter received a completion certificate before the Act commenced; or for renovation, repair or redevelopment which does not involve marketing, advertising, selling or new allotment of any apartment, plot or building.
The proviso to clause (a) lets the appropriate Government reduce the five hundred square metre or eight apartment threshold. The explanation adds that where a project is developed in phases, every phase shall be considered a stand-alone real estate project and the promoter shall obtain registration for each phase separately.
A large pre-launch for hundreds of families is unlikely to fall inside the small-project exemption. If a sales team says a project does not need registration, ask which clause of Section 3(2) they rely on.
| Stage of the project | What the Act says | What a buyer can check |
|---|---|---|
| Before registration | Section 3(1) bars advertising, marketing, booking, selling or inviting purchases in a planning area | Whether a registration number exists on the regulator's portal |
| Small project | Section 3(2)(a) exempts land up to 500 square metres or up to eight apartments, all phases | Land area and number of units in the plan |
| New phase of an existing project | Explanation to Section 3: each phase is a stand-alone project needing its own registration | Registration number for the specific phase on offer |
| Advertising after registration | Section 11(2): ads must prominently show the Authority's website and the registration number | The number printed on the ad or deck |
| Contravention of Section 3 | Section 59(1): penalty up to ten per cent of estimated project cost | Orders on the regulator's website |
What penalties apply to a promoter who skips registration?
Section 59(1) says if any promoter contravenes the provisions of section 3, he shall be liable to a penalty which may extend up to ten per cent of the estimated cost of the real estate project as determined by the Authority.
Section 59(2) goes further. If the promoter does not comply with the orders, decisions or directions issued under sub-section (1), or continues to violate section 3, he shall be punishable with imprisonment for a term which may extend up to three years, or with fine which may extend up to a further ten per cent of the estimated cost of the project, or with both.
These are penalties paid to the state, not compensation paid to a buyer. For a buyer, their main value is as a signal of how seriously the Act treats registration. Our earlier guide on unregistered projects under Sections 3 and 59 covers the penalty side in more depth.
What does a buyer lose by paying before registration?
The disclosures and safeguards that come with registration. Section 4(2) lists what a promoter must file when applying, including the declaration under clause (l) supported by an affidavit stating legal title to the land, that the land is free from encumbrances or the details of encumbrances, the time period within which the promoter undertakes to complete the project, and that seventy per cent of amounts realised from allottees shall be deposited in a separate account.
Before registration, those statements may not exist on the regulator's record for the project. Section 13(1), which says a promoter shall not accept more than ten per cent of the cost as an advance without first entering into a registered agreement for sale, also assumes a project being sold under the Act's framework.
Registration itself is not a long wait under the Act. Section 5(1) says that on receipt of an application, the Authority shall within thirty days either grant registration and provide a registration number, or reject the application for reasons recorded in writing. Section 5(2) says that if the Authority does neither, the project shall be deemed to have been registered, and a registration number shall be provided within seven days after the thirty days end. Section 5(3) says the registration is valid for the period the promoter declared for completion. On the Act's own timelines, a pre-launch that says registration is in process is asking buyers to pay inside a window the Act expects to be short.
Ask, too, what refundable means on the EOI receipt. If the refund terms are not in writing, with a date and a method, the word alone does not tell you much.
How can you check a Bengaluru project's registration?
On the Karnataka regulator's portal, using the number printed on the ad. Section 11(2) says an advertisement or prospectus issued by the promoter shall mention prominently the website address of the Authority, wherein all details of the registered project have been entered, and include the registration number obtained from the Authority. A deck that says registration is in process, with no number, is telling you the project is not yet registered.
Our step-by-step guide on how to verify a K-RERA project registration shows what to look for. PropNewz project pages also carry registration numbers where available. The page for Saiven Six Senses in Kasavanahalli, for example, lists K-RERA number PRM/KA/RERA/1251/446/PR/290525/007795, the kind of number a buyer should be able to find for any project before paying.
What should you do before paying an EOI?
- Ask for the project's registration number and match it on the Karnataka regulator's portal.
- If the deck says registration is in process, treat the project as unregistered for now.
- Check whether the phase being offered has its own registration, since each phase is a stand-alone project.
- If told the project is exempt, ask which clause of Section 3(2) applies and check land area and unit count.
- Get any refund terms for the EOI in writing, with a date and method of refund.
- Read the registration filings once available, including the title, encumbrance and completion date declarations.
- Keep advances within ten per cent of cost until a registered agreement for sale exists, as Section 13(1) requires.
Frequently asked questions
Can a builder take bookings before RERA registration?
Section 3(1) of the RERA Act says no promoter shall advertise, market, book, sell or offer for sale, or invite persons to purchase in any manner, any plot, apartment or building in a real estate project in a planning area without registering the project with the Real Estate Regulatory Authority.
Is an expression of interest cheque covered by RERA?
Section 3(1) covers inviting persons to purchase in any manner, and Section 2(b) defines advertisement to include publicity inviting persons to purchase or make advances or deposits. Whether a particular expression of interest scheme breaches Section 3 is decided by the Authority on the facts of each case.
Which projects are exempt from RERA registration?
Section 3(2) exempts projects where land does not exceed five hundred square metres or apartments do not exceed eight across all phases, projects with a completion certificate before the Act commenced, and renovation, repair or redevelopment not involving marketing, advertising, selling or new allotment.
What is the penalty for selling an unregistered project?
Section 59(1) says a promoter who contravenes Section 3 is liable to a penalty up to ten per cent of the estimated project cost. Under Section 59(2), continued violation or non-compliance with orders can lead to imprisonment up to three years, a further fine up to ten per cent, or both.
An early price can be tempting, but the registration number is the first thing to ask for, not the last. This is general buyer information, not legal or investment advice.
Last updated 2026-10-27. PropNewz Team.
Contact Us
Stay updated with latest news and new projects!
Tell us what you want, We'll do the rest.
Share your budget and where you're looking. An advisor who has actually walked the sites will shortlist a handful of RERA-registered projects and tell you which to skip.