Housing Minister Manohar Lal Slams NCLT for Failing Homebuyers, Calls for Real Estate Reforms
Union Housing and Urban Affairs Minister Manohar Lal criticizes the National Company Law Tribunal (NCLT) for failing to resolve stalled real estate projects and calls for stricter adherence to RERA norms and faster project approvals.
Real EstateNcltReraHousing ProjectsGdpReal EstateAug 30, 2025
Speaking at the annual convention of the realtors’ body NAREDCO, the minister said NCLT was envisaged to revive projects and protect consumers, but instead, it has become a graveyard for unfinished housing schemes. “Projects that could otherwise have been saved are never completed once they go to NCLT. The system has not delivered what it was supposed to,” he remarked, adding that he was raising this concern with the consent of the Prime Minister.
A presentation on reforms, prepared with the Corporate Affairs Ministry, is now set to be placed before the PM, he said. Beyond the tribunal issue, the minister also pulled up developers on cash transactions in property deals, warning that the government is working to eliminate them. “Cash dealing is a big problem in the real estate sector,” he said, urging builders to align circle rates with market rates to reduce cash usage.
He also directed the industry to steer clear of misleading advertisements, stressing that transparency in marketing is critical for building trust with homebuyers. RERA (Real Estate Regulatory Authority) was introduced in 2017 to significantly reduce disputes between builders and consumers. However, Manohar Lal admitted that there are still instances of fund diversion from escrow accounts meant for construction, leaving projects stuck despite regulation. “This is unacceptable. If we want to raise the sector’s credibility, strict adherence to RERA norms is essential,” he cautioned.
Delays in project approvals remain another drag on growth. The minister asked NAREDCO to press state governments for ease of doing business and faster clearances, highlighting that best practices adopted by some states should be replicated nationwide. Citing his tenure as Haryana Chief Minister, he said his government introduced single window clearances and special schemes for stalled projects during the COVID-19 pandemic, which helped revive activity.
Calling the real estate sector a pillar of India’s progress, Manohar Lal underlined that it already contributes 8-10 percent to GDP, but must aim to reach 18 percent by 2047. India’s economy, he said, is expanding rapidly under PM Modi’s leadership, registering 7.8 percent growth in April-June 2025 despite global headwinds and the recent 50 percent US tariff shock. “The high growth silences countries that doubt India’s potential,” he declared.
The minister also highlighted India’s infrastructure progress, particularly in metro rail, where the country is ranked third globally with 1,036 km of operational lines. With another 900 km under construction, he said India will soon surpass the United States to become the second largest metro network in the world. The focus now, he added, is on ensuring last-mile connectivity so commuters can fully benefit from the expanding system.
Frequently Asked Questions
What is the main issue with the National Company Law Tribunal (NCLT) according to Manohar Lal?
According to Manohar Lal, the NCLT has failed to resolve cases of stalled real estate projects, often leaving projects unfinished and causing significant delays.
What reforms is the government planning to present to the Prime Minister regarding the real estate sector?
The government is preparing a presentation on reforms with the Corporate Affairs Ministry, focusing on issues such as cash transactions, misleading advertisements, and adherence to RERA norms.
How is the government aiming to eliminate cash transactions in the real estate sector?
The government is urging builders to align circle rates with market rates to reduce the use of cash in property deals and is working on policies to eliminate cash transactions.
What is the current contribution of the real estate sector to India's GDP, and what is the target by 2047?
Currently, the real estate sector contributes 8-10 percent to India's GDP, and the target is to increase this to 18 percent by 2047.
How is the government addressing delays in project approvals?
The government is pushing for ease of doing business and faster clearances by urging state governments to adopt best practices and streamline approval processes.
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