Key Highlights: Supreme Court Raises Concerns on RERA Functioning
- Supreme Court Criticism: CJI Surya Kant and Justice Joymalya Bagchi expressed that RERA authorities are failing homebuyers and often favor defaulting builders.
- “Rehabilitation Centre” Remark: The bench noted that retired IAS officers occupy RERA positions, turning authorities into posts for retired officials rather than effective consumer protection bodies.
- Core Concerns: Delays in relief, weak enforcement of orders, and perceived leniency towards defaulting builders undermine RERA’s purpose of safeguarding homebuyers.
- State-Specific Action: Himachal Pradesh was allowed to move the RERA office to Dharamshala, with directions to shift the appellate tribunal to minimize inconvenience to litigants.
- Call for Reform: Experts and homebuyer groups urge strengthening enforcement, transparent appointments, and efficient dispute resolution instead of abolishing RERA.
The Supreme Court of India has expressed its deep concerns regarding the working of Real Estate Regulatory Authorities (RERA) in different states. The court made an observation that if the RERAs end up helping the defaulting builders rather than protecting the homebuyers, then the authorities should perhaps be abolished.
A bench comprising of Chief Justice of India Surya Kant and Justice Joymalya Bagchi along with others who were hearing an appeal on the issue of moving the state RERA office in Himachal Pradesh gave these comments. “It is high time that all the states should revisit and rethink constituting this authority,” CJI Surya Kant said during the hearing as per HT.
The Court did not hold back in its criticism. “Except facilitating the builders in default, this institution is doing nothing. Better abolish this institution, we don't mind that,” the CJI said.
The Court was dealing with a matter arising from an order of the Himachal Pradesh High Court, which had stayed a state notification shifting the RERA office from Shimla to Dharamshala.
The High Court had earlier noted:
- The decision to shift the office was taken without identifying an alternative premises.
- Adjusting outsourced employees elsewhere could render RERA non-functional.
- The notification dated June 13, 2025, would remain until further orders.
The Supreme Court, however, allowed the state to move the RERA office to Dharamshala and also directed that the appellate tribunal be shifted to avoid inconvenience to litigants.
‘Rehabilitation Centre’ Remark
During the hearing, when informed that a retired IAS officer had been appointed to RERA, the CJI remarked, “In every state, it has become a rehabilitation centre. These authorities are all occupied by these persons.”
The bench further said, “The people for whom this institution was created, they are completely depressed, disgusted and disappointed. None of them are getting any effective relief. For whom this institution actually is now serving, you will find out when you meet these people.”
The Court’s criticism highlights key concerns:
- Delays in granting effective relief to homebuyers.
- Weak enforcement of RERA orders.
- Perception that authorities are lenient towards defaulting builders.
Purpose of the RERA Act
The Real Estate (Regulation and Development) Act, 2016 has been brought about to regulate the real estate sector, increase transparency, ensure timely completion of projects, and protect homebuyers against delays and unjust practices. It was broadly considered a significant reform to bring accountability to a sector which was marked by project delays and no oversight.
About nine years after its application, the effectiveness of the law enforcement by the authorities is being questioned.
The Forum for Peoples Collective Efforts (FPCE), a homebuyers organization which supported the enactment of RERA, said that the Supreme Courts statements reflect issues of the past that were brought up repeatedly. Its president, Abhay Upadhyay, pointed out that even after several years of the existence of RERA, there is still no guarantee that the projects which have been registered will be completed on time or that the homebuyers will get the benefits as promised.
In his words, he emphasized that if RERA fails to accomplish its objectives, then either major reforms or a strong move may be needed to bring back faith in the system.
Reform Debate Intensifies
It is true that the Supreme Court has not given any order to do away with RERA. However, its critical remarks have certainly heated the discussion about the real estate regulation regime in India. Some lawyers are of the view that throwing away the law is not the solution, rather, it is the strengthening of enforcement mechanisms, the transparent making of appointments, and the effectiveness of dispute resolution that should be focused on.
So far, it is the Court's observations that have raised the alert of the state governments, compelling them to think if their RERA bodies indeed cater to the consumers' interests or they are just protecting the habitually defaulting builders.
Image source- sci.gov.in
.png)