NCLT Fails to Meet Real Estate Sector Expectations: Union Minister Khattar
Union Housing and Urban Affairs Minister Manohar Lal Khattar has criticized the National Company Law Tribunal (NCLT) for its inability to resolve issues in the real estate sector, highlighting the high probability of stressed projects never getting completed.
NcltReal EstateManohar Lal KhattarReraNaredcoReal EstateAug 30, 2025
If a project that could have been revived ends up at the NCLT, it is highly unlikely that it will ever be completed. Khattar stated, “NCLT has not been able to improve the system as was envisaged. If a project, which could otherwise have been revived, goes to the NCLT, it is certain that it will never get completed.”
Khattar made it clear that he was critiquing a government mechanism with the consent of the Prime Minister. “This issue has reached the PM. We will soon make a presentation to him, which has been prepared in consultation with the corporate affairs ministry. We need to correct the system, and if we do it together, it will be better,” he added.
In his address, Khattar also urged builders to avoid cash dealings in property transactions to ensure the proper growth of the real estate sector and promote transparency. He advised the industry to avoid issuing misleading advertisements for their projects.
On the effectiveness of RERA, the real estate regulation law, Khattar noted that disputes between buyers and builders have been reduced since its enactment. “There have been some instances where people have taken out money from the Escrow Account without carrying out construction, not spending it on construction. We have information of the nexus in this as well,” he pointed out.
Earlier in the day, Civil Aviation Minister K Rammohan Naidu announced that the government will conduct a study with the assistance of the International Civil Aviation Organization (ICAO) to address issues related to height restrictions for buildings around airports. The government also plans to develop aerotropolises or cities around airports without compromising on aviation safety.
Frequently Asked Questions
What is the National Company Law Tribunal (NCLT)?
The National Company Law Tribunal (NCLT) is a quasi-judicial body in India that deals with issues related to the winding up of companies and other legal matters concerning corporate entities. It was established to provide a specialized forum for resolving corporate disputes.
Why is the NCLT criticized in the real estate sector?
The NCLT is criticized in the real estate sector for its inability to deliver the desired results and for the high probability that stressed projects reaching the tribunal will never get completed. This criticism highlights the need for reforms to improve the system.
What is RERA?
RERA stands for the Real Estate (Regulation and Development) Act, 2016. It is a law enacted to regulate the real estate sector in India, ensuring transparency, accountability, and protection for homebuyers. RERA aims to reduce disputes between buyers and builders.
What is NAREDCO?
NAREDCO stands for the National Real Estate Development Council. It is a prominent real estate developers' body in India that represents the interests of real estate developers and promotes the growth of the real estate sector.
What are aerotropolises?
Aerotropolises are cities developed around airports. They are designed to leverage the economic and logistical advantages of proximity to an airport, often including business districts, residential areas, and other facilities to support aviation and related industries.
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