High Court Upholds HRERA Penalties on Ansal Properties Despite Insolvency
The Punjab and Haryana High Court has ruled that Ansal Properties and Infrastructure Ltd must face penalties imposed by the Haryana Real Estate Regulatory Authority (HRERA) for statutory non-compliance under the RERA Act, even while undergoing insolvency proceedings.
HreraRera ActAnsal PropertiesInsolvencyReal EstateReal EstateSep 18, 2025
The High Court clarified that despite the company undergoing insolvency proceedings, it must ensure compliance through its resolution professional. The court also noted that the petitioner company has an alternative remedy of appeal before the Real Estate Appellate Tribunal under Section 43(5) of the RERA Act, instead of directly approaching the High Court in a writ petition.
A division bench comprising Justice Anupinder Singh Grewal and Justice Parmod Goyal passed these orders while dismissing a petition filed by Ansal Properties and Infrastructure Limited through its resolution professional. The dispute arose when HRERA, through orders dated May 14, 28, and March 26, 2025, directed Ansal Properties to deposit penalties of Rs 8 lakh each in multiple suo motu complaints relating to alleged non-compliance of statutory obligations under the RERA Act.
These proceedings were initiated due to continued defaults in disclosures and project compliance requirements. Ansal Properties, however, argued that the orders were unsustainable because the company was already undergoing Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code, 2016 (IBC). The National Company Law Tribunal (NCLT), New Delhi, on February 25, 2025, admitted a Section 7 petition against the company and appointed a resolution professional, thereby triggering the statutory moratorium under Section 14 of the IBC.
The company argued that once the moratorium was in place, HRERA could not insist upon penalties being deposited, as the corporate debtor's management stood suspended and its affairs were under the resolution professional. After examining the plea, the bench observed that the Resolution Professional had access to the assets of the petitioner company. Penalty was imposed on account of non-compliance of statutory provisions under the Real Estate (Regulation and Development) Act, 2016 (hereinafter referred to as the ‘RERA Act').
The impugned orders are interim orders, and the petitioner was directed to deposit the penalty before the next date of hearing. The HRERA, while passing the impugned order, relied upon the judgments of the Supreme Court to hold that the Real Estate Regulatory Authority can impose penalties under Chapter VIII of the RERA Act.
'The Resolution Professional is obligated to comply with the statutory requirements as set out in the RERA Act. Therefore, we do not find any illegality in the interim orders passed by the HRERA which would warrant interference in the matter at this stage. Moreover, the petitioner has an alternative remedy of challenging the impugned orders by preferring an appeal before the Real Estate Appellate Tribunal under Section 43(5) of the RERA Act,' observed the bench dismissing the company's plea.
Frequently Asked Questions
What is the RERA Act?
The RERA Act, or the Real Estate (Regulation and Development) Act, 2016, is a law in India aimed at regulating the real estate sector, protecting homebuyers, and ensuring timely completion and delivery of real estate projects.
What is HRERA?
HRERA stands for Haryana Real Estate Regulatory Authority. It is the regulatory body established under the RERA Act to oversee and enforce compliance with the Act in the state of Haryana.
What penalties did HRERA impose on Ansal Properties?
HRERA imposed penalties of Rs 8 lakh each on Ansal Properties for multiple instances of non-compliance with statutory obligations under the RERA Act.
What is the Corporate Insolvency Resolution Process (CIRP)?
The Corporate Insolvency Resolution Process (CIRP) is a procedure under the Insolvency and Bankruptcy Code, 2016, designed to revive or liquidate a corporate debtor in a time-bound manner.
Can a company under CIRP be penalized by HRERA?
Yes, a company under CIRP can still be penalized by HRERA for non-compliance with the RERA Act. The High Court ruled that the resolution professional is obligated to ensure compliance with statutory requirements.
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