Separate bank account and withdrawal control

Seventy per cent of amounts realised from allottees must be deposited in a separate project account for land and construction cost, with withdrawal linked

Finin2min summary

Seventy per cent of amounts realised from allottees must be deposited in a separate project account for land and construction cost, with withdrawal linked to completion and professional certification.

Source review date: 4 July 2026. Read with the official text and the facts of the transaction.

Legal anchors

Section 4(2)(l)(D)
State rules, circulars and certificate formats
MoHUA official FAQs

How to analyse it

Open a project-specific account.
Reconcile collections to deposits.
Obtain engineer, architect and CA certificates before withdrawal.
Complete annual audit within the statutory period.

Practical illustration

A promoter collects ₹100 crore and deposits ₹70 crore. Withdrawals should follow certified percentage of completion and permitted land/construction cost, not group cash needs.

What can go wrong?

Calling it a discretionary escrow
Withdrawing before certification
Inter-project transfers

Evidence pack

Bank statements
Collection reconciliation
Professional certificates
Annual audit report

Decision workflow

Freeze the facts and effective date.
Identify the controlling Act, rule, notification, circular and jurisdictional overlay.
Prepare a calculation or exposure note.
Collect the evidence pack before filing, payment, signing or response.
Record reviewer conclusion and assumptions.

Quick Q&A

Is the result automatic?

No. Open a project-specific account.

What is the most important control?

Complete annual audit within the statutory period.

What should be escalated?

Calling it a discretionary escrow, especially where money, deadlines, enforcement, personal liability or irreversible transaction steps are involved.

Official source trail

Secondary commentary may help interpretation, but it is not the source of law.