Expert Urges Fixing RERA Implementation Gaps, Not Abolishing It
The recent remarks by the Chief Justice of India (CJI) to scrap the Real Estate (Regulation and Development) Act (RERA) have sparked significant debate in the real estate sector. The CJI observed that RERA has only helped builders and not homebuyers, failing in its purpose of protecting homebuyers and ensuring accountability. The bench also criticized delays in dispute resolution, weak enforcement, and the growing perception that RERA authorities are ineffective and biased. Advocate Shirish V Deshpande, chairman of Mumbai Grahak Panchayat, provides insights into these comments and the future of RERA.
Deshpande emphasizes that the CJI's remarks must be viewed seriously and with perspective. They deserve serious attention from all RERA authorities and the Ministry of Housing and Urban Affairs. He welcomes the observations, as they have prompted both state RERA bodies and the Government of India to introspect. The reported comments are sharp and call for immediate corrective action. The experience of homebuyers in Maharashtra broadly aligns with the court’s concerns, with delays in dispute resolution, weak enforcement, and a perception of bias towards defaulting builders.
The CJI’s dissatisfaction over the appointment of retired IAS officers as chairpersons of RERA authorities in various states and union territories reflects deeper structural concerns. However, Deshpande does not agree with the suggestion that RERA should be abolished. The Real Estate (Regulation and Development) Act, 2016 contains strong provisions to safeguard homebuyers’ interests. Scrapping it would allow errant builders to go scot-free and erase the legal accountability and transparency introduced in the real estate sector. It is unlikely that the CJI literally intended abolition; rather, the strong wording appears meant to shake the system out of complacency.
The message is clear – the Supreme Court is watching, and authorities must course-correct. RERA has brought much-needed transparency by mandating the registration of all real estate projects with state authorities, except for small projects on plots not exceeding 500 square metres or those with not more than eight apartments. However, MahaRERA interpreted Section 3(2)(a) in a manner that exempted projects with 200 to 250 flats in 25-to-30-storey towers if the plot area was within 500 square metres. This interpretation, in Deshpande’s view, defeats the legislative intent, which never aimed to exempt such large developments.
A similar issue arises in redevelopment projects. MahaRERA has maintained that residents in the rehabilitation portion of redevelopment schemes are not covered under RERA. Mumbai Grahak Panchayat has consistently argued that when a redevelopment project includes a sale component, the rehab portion should not be excluded. Persisting with such builder-friendly interpretations inevitably strengthens the perception highlighted by the CJI. Coincidentally, a Real Estate Development Conclave was held in Delhi the day after the court’s remarks, attended by the MoHUA minister.
Deshpande raised these specific issues, along with other areas requiring amendment. The minister has indicated a willingness to incorporate the suggestions of Mumbai Grahak Panchayat in the proposed amendments to RERA to ensure stronger protection for homebuyers. The path forward lies not in dismantling RERA, but in enforcing it in letter and spirit.
