RERA orders rarely translate into relief; homebuyers left in limbo in Bengaluru

Bengaluru: Carrying the dream of owning a home, Nikhil N booked an under-construction flat in Jakkur in 2012 and paid nearly 90% of the cost by 2015.

When the builder failed to deliver despite repeated extensions, the marketing professional approached Karnataka’s Real Estate Regulatory Authority (K-RERA) in 2018.

A year later, RERA ordered a refund with interest. But recovery proceedings stalled at the tahsildar’s office. Nikhil then moved the Karnataka High Court, only to lose on technical grounds: the order had been passed by the adjudicating officer, not the authority itself.

In 2023, he filed a fresh plea before RERA. The chairman ordered repayment of around Rs 40 lakh with interest and penalty. Yet again, the file got stuck in the Revenue Department. Left with little choice, Nikhil has returned to the High Court. The matter is listed for hearing later this month.

His case mirrors the ordeal of hundreds of homebuyers across Karnataka.

Since its formation in July 2017, K-RERA has passed recovery orders in 2,338 cases. However, only 291 homebuyers — about 12.45% — have secured actual relief. For the rest, enforcement remains elusive.

Conceived as a speedy dispute-resolution mechanism, RERA is increasingly described by petitioners as a “paper tiger”. Delays are reported at every stage — from admission of complaints and hearings to uploading orders and executing them. Once a Revenue Recovery Certificate (RRC) is issued, the matter moves to the Revenue Department, where files often remain pending for months, sometimes years.

Even the Supreme Court has voiced concern.

A bench led by Chief Justice Surya Kant observed that it was high time state governments revisited the constitution and functioning of RERA bodies, noting that beneficiaries of the law appeared “depressed, disgusted and disappointed”. In strong remarks, the court said that if the institution was not serving its purpose, “it is better to abolish it”.

Homebuyers argue that RERA has the power to deny registration of new projects to developers who fail to comply with its orders. Yet this provision is rarely enforced.

Extensions granted to builders for project delays are often generous. Moreover, RERA Karnataka has never published its mandatory annual report, as required under Section 78 of the Real Estate (Regulation and Development) Act, 2016.

MS Shankar, convener of Fight for RERA, said regulatory authorities across states had lost their sheen, but Karnataka’s RERA was the “worst of all”.

“More than 2,000 cases are awaiting refunds. Developers facing multiple complaints can be barred from registering new projects. Yet this provision is seldom invoked,” he said.

Prominent businessman Mohandas Pai said institutions created with good intent had become instruments of corruption and rent-seeking.

“RERA is mandated to dispose of complaints within 60 days. It has, however, been captured by builders. When there is a rate card for approvals, how can there be justice?” he asked.