Section 3 of the Real Estate (Regulation and Development) Act, 2016 provides that no promoter shall advertise, market, book, sell, or offer for sale any plot, apartment, or building without registering the project with the Real Estate Regulatory Authority. Earlier, TNRERA had issued penalty guidelines through Circular No. TNRERA/3867/2024 dated November 13, 2024. Based on the 35th Authority meeting held on August 28, 2025, the penalty framework has now been revised and supersedes the earlier order.

The revised penalty structure categorises local bodies into different jurisdictions (Greater Chennai Corporation, Chennai Metropolitan Area, other Corporations, Municipalities, Town Panchayats, and Village Panchayats) with penalties ranging from ₹15,000 to ₹3,000 per plot/flat/apartment.

The penalty shall be the highest of the following:

• As per the jurisdiction-wise rates in Table-1, OR
• 2% of proportionate project cost (plots) / 1% of proportionate project cost (flats) sold without registration, OR
• 2% of the total sale value of plots/flats sold without registration (as per Encumbrance Certificate).

For multiple sales in violation:

• 10–50 plots/flats/apartments – additional penalty of 50% of above penalty.
• More than 50 plots/flats/apartments – additional penalty of 100% of above penalty.

The revised order takes immediate effect and overrides the earlier penalty circular of November 13, 2024.