'Cannot remain silent spectator to shattering of taxpayers’ dream homes,' SC tells Centre

The Supreme Court calls housing a fundamental right under Article 21, directing the government to set up a revival fund or expand SWAMIH to protect homebuyers from stalled real estate projects.

New Delhi: The Supreme Court has ruled that the Centre cannot remain a silent spectator when the dream of homeownership for taxpayers is shattered. An average homebuyer invests hard-earned money with the expectation of a stable roof over their family’s head, and the anxiety of being left without a home despite paying a fortune takes a serious toll on health, productivity, and dignity.

A bench of Justices J. B. Pardiwala and R. Mahadevan directed the Union government to consider establishing a revival fund under the National Asset Reconstruction Company Ltd (NARCL) or expanding the SWAMIH (Special Window for Affordable and Mid-Income Housing) Fund. This fund would provide bridge financing for stressed real estate projects undergoing Corporate Insolvency Resolution Process (CIRP), preventing the liquidation of viable projects and safeguarding homebuyers’ interests.

The court passed a series of directives to authorities to protect bona fide homebuyers and stabilize the real estate sector.

In its judgment delivered on September 12, the court asserted that a home is not merely a roof over one’s head, but a reflection of hopes and dreams—a safe space for a family, a refuge from the world’s worries.

The bench noted that an average homebuyer often pours life savings into a developer’s pocket and stressed that these savings must culminate in the timely possession of the promised home.

“Article 21 mandates nothing less,” the court said, citing Samatha vs State of AP (1997), which affirms the right to social and economic justice, including shelter, as a fundamental right under the right to life.

The court rejected the notion of treating home-buying as a simple commercial transaction.

Housing is neither a luxury nor a speculative commodity—it is a fundamental human need.

“The right to secure, peaceful, and timely possession of one’s home is thus part of the fundamental right to shelter under Article 21,” it emphasized.

The state has a constitutional duty to create and strictly enforce a framework preventing developers from defrauding or exploiting homebuyers.

“Ensuring timely project completion must be the cornerstone of India’s urban policy. The State must also tackle the parallel cash economy and speculative practices in real estate that artificially inflate prices and allow opportunistic investors to jeopardize genuine homebuyers,” the court added.

The apex court stressed that RERA authorities must not be reduced to toothless tigers. They must be equipped with adequate infrastructure, empowered tribunals, and effective enforcement mechanisms to implement their orders swiftly and in full.

“This is ultimately a policy matter under the government’s domain, but the state cannot remain a silent spectator,” the court said.

Lakhs of homebuyers are plagued by uncertainty as several projects nationwide face insolvency proceedings, jeopardizing possession of their homes.

The court suggested the Centre may consider setting up a corporate entity, like NARCL, supported by real estate/construction-focused PSUs or Public-Private Partnerships, to identify, take over, and complete stalled projects under the IBC framework. “Unsold inventory from such projects could be used for affordable housing schemes like PMAY or for government quarters, addressing both the housing shortage and reviving distressed projects,” the court said.

The bench underscored that every rupee of the large fund—drawn from public money—must be used strictly for last-mile financing and protected against misuse.

It further directed that a comprehensive periodic performance audit by the CAG be conducted, with reports made available publicly in a layperson-friendly format.

Finally, the court mandated that vacancies in NCLT/NCLAT be filled urgently, and dedicated IBC benches with additional strength be set up to expedite proceedings.