NCLT Failing Homebuyers: Manohar Lal Calls for Real Estate Reforms
Union Housing and Urban Affairs Minister Manohar Lal criticizes the National Company Law Tribunal (NCLT) for its failure to resolve stalled real estate projects and calls for stricter adherence to RERA norms. He also pushes for faster approvals and aims to double the real estate sector's GDP share by 2047.
Real EstateNcltReraGdpInfrastructureReal Estate NewsAug 30, 2025
“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.
Cash dealings and misleading advertisements have also come under the spotlight. 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 has improved consumer protection, but gaps remain. Manohar Lal noted that the introduction of RERA (Real Estate Regulatory Authority) in 2017 has significantly reduced disputes between builders and consumers. However, he 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?
Manohar Lal criticized the NCLT for failing to resolve cases of stalled real estate projects, stating that projects that could otherwise be saved are never completed once they go to NCLT.
What reforms is the government planning to address the issues in the real estate sector?
The government is planning to eliminate cash transactions in property deals, align circle rates with market rates, and ensure transparency in marketing to build trust with homebuyers.
How has RERA (Real Estate Regulatory Authority) impacted the real estate sector?
RERA has significantly reduced disputes between builders and consumers, but there are still instances of fund diversion from escrow accounts meant for construction, leaving projects stuck despite regulation.
What is the target for the real estate sector's contribution to India's GDP by 2047?
The target for the real estate sector's contribution to India's GDP by 2047 is to reach 18 percent.
What is the current status of India's metro rail network and future plans?
India is currently ranked third globally with 1,036 km of operational metro rail lines. With another 900 km under construction, India is set to surpass the United States to become the second largest metro network in the world.
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