Beyond the Blueprint: RERA’s Role in Reshaping India’s Real Estate Justice System  

Introduction  

The Indian real estate industry has been one of the largest segments of the economy, generating employment for millions, and attracting both domestic and foreign investments. However, this growth came at the back of serious structural inefficiency. Homebuyers are often faced with long delays in waiting for projects to be completed, a lack of accountability, and overreaching terms and conditions included in contracts. Developers would routinely divert money away from projects to allocate to other projects, having homebuyers in limbo regarding possession of their property. In particular, resolution of disputes prior to 2016 were incoherent today- civil courts were bogged down with other matters, consumer forums backlogged with cases, and arbitrations tended to benefit developers, this resulted in reduced consumer confidence in the industry. This state of affairs was taken care of with the enactment of the Real Estate (Regulation and Development) Act, 2016 (RERA), which constituted India’s first specific legislation that comprehensively assured the regulation of the real estate sector. Comprising of three objectives, the legislation aimed for an end to confusion through assurance of clarity through transparency, accountability and efficient determination of disputes. 

Pre-RERA Disorder: Key Problems and Stakeholders 

Before RERA, the sector was plagued with uncertainty and one-sided practices. Home buyers invested their life savings expecting timely delivery but were left at the mercy of developers. Standard sale agreements were biased they allowed promoters to alter layouts unilaterally, impose unjustified price escalations, and include arbitration clauses that limited buyer recourse. Project delays, sometimes stretching over a decade, became common as developers faced liquidity crises or failed to obtain clearances. Further, buyers had to choose between multiple forums civil courts, consumer commissions, and municipal bodies each with limited jurisdiction. This led to forum shopping, inconsistent rulings, and duplication of cases. Adding to this chaos was a serious information gap. Developers controlled details about land titles, approvals, and financial progress, leaving buyers in the dark.

Genesis of the RERA: Legislative Purpose and Design 

In light of the significant irregularities in the Indian real estate sector, the Government of India introduced the Real Estate (Regulation and Development) Bill in 2013, which became legislation in 2016 the RERA objective was two-fold: protect homebuyers through transparency and to professionalize the industry for sustainable investments. It intended to harmonize practices across states, eliminate misappropriation of buyer funds, ensure buyer access to reliable project information, and to ensure expedited dispute resolution. The RERA required developers to register projects and/or agents, mandated complete disclosure of project information, and required only 30% of collected funds be permissibly diverted the 70% escrow rule. It also created regulated institutional mechanisms State RERA Authorities, Adjudicating Officers, and Appellate Tribunals to seek equitable balance for developers and buyers.¹  

RERA’s Dispute Resolution Mechanisms 

RERA built a structured, timely, and accessible dispute resolution mechanism. Any aggrieved buyer, association of allottees, or developer could submit a complaint online to the State RERA Authorities for nominal fee. The RERA Authority had the power to summon witness(es), require documents, order refunds, and impose fines. In matters concerning compensation, Judicial Adjudicating Officers dealt with complaints on a summary proceeding basis to reduce possible delays. Appeals could be made to the Real Estate Appellate Tribunal (REAT) and further to the High Court on questions of law. Although the 60-day resolution target is not always met, RERA has substantially reduced pendency compared to older forums. ² 

Interplay with Other Jurisdictions of Law 

RERA operates as complementary to existing statutes of law, but creates potential overlap, as some statutory forums operate concurrently with the jurisdiction of RERA. Under the Consumer Protection Act, a Supreme Court of India ruling has confirmed that buyers could approach either RERA or persons under the consumer forum since the remedies existed concurrently. Courts have also prohibited the arbitration provisions in agreements in circumstances where the dispute arises from statutory obligations under RERA, noting that rights under RERA could not be waived. Section 79 of RERA prohibits civil courts from hearing any dispute arising under RERA. Judicial interpretation has created a degree of harmony to address the overlap and the extent of each forum.³ 

 Judicial Interpretation and Fashioning Landmark Cases 

Judicial decisions provide the foundation for RERA’s framework. Imperia Structures affirmed that RERA was an addition rather than a replacement to consumer remedies. Courts find limits to arbitration where issues arise with registration and disclosure but allowed it in commercial issues where there are no statutory duties. There is a prioritization of consumer protection, while simultaneously discouraging multiple applications that may issue in competing assertions.  

Practical Consequences and Examples 

RERA has made a positive impact in the form of increased transparency, expedited dispute resolution, and better buyer protection. The requirement to disclose approvals and update progress has increased accountability of promoters, and lessened information deficits. Maharashtra’s MahaRERA has resolved thousands of complaints and authorized significant refunds to buyers, although some backlog still exists. Enforcement continues to be a problem, particularly when a builder is insolvent, which involves working with the banks or an insolvency tribunal to recover buyer funds. Nonetheless, RERA has improved compliance, compelled promoters to repay funds with interest, and it has reduced the sale of properties that are not compliant with RERA law.⁴   

Criticisms, Gaps, and Remaining Challenges 

RERA has been implemented unevenly among the states. Some states’ RERAs act efficiently, while receivership in others is limited by insufficient staff and infrastructure to support effective resolution. Enforcing orders, particularly following insolvency is often extremely difficult or impossible, further complicated by RERA overlapping the jurisdiction of several other forums that may then lead to forum shopping or delays. Moreover, RERA cannot, by itself, stop financial failure in the real estate sector, meaning better coordination with insolvency laws will be needed to improve coordination outcomes. 

Policy Proposals and Future Considerations 

 In order to enhance RERA’s framework, reform efforts should include an emphasis on establishing state regulations that align with national regulations, integrating RERA into insolvency processes, and developing technical capacity through an adjudication process that brings engineers and auditors into the picture. In addition, procedures and internal protocols should remain clear and functional to prevent cases from becoming duplicative, and there is also a need to develop awareness among buyers and strengthen complaint processes through outreach and legal assistance in an accessible format. 

Conclusion  

RERA has transformed the real estate landscape in India through a focus on transparency, accountability, and effective alternative dispute resolution. Courts have acted to protect consumer rights while ensuring the market is maintained. Nevertheless, challenges remain with enforcement, challenges with capacity among states, and manage insolvency. Moving forward, strengthening implementation, coordination with other legal orders, and strengthening institutional capacity will allow RERA to meet its potential and engender sustainable trust in India’s housing market.