Winning Bizness Desk

Mumbai. The Supreme Court has sharply questioned the functioning of the Real Estate Regulatory Authority, observing that it may be better to shut it down if it fails to protect homebuyers. Hearing a plea against a Himachal Pradesh High Court order, a bench of Chief Justice Surya Kant and Justice Joymalya Bagchi said the authority appears to be benefiting defaulting builders rather than distressed buyers. The remarks come amid growing dissatisfaction among homebuyers nearly nine years after the law was enacted.

RERA failing original mandate

The bench said the time has come for state governments to reconsider the very formation of RERA bodies. According to the court, the authority has strayed from the purpose for which it was established. Instead of ensuring accountability and timely possession, it is allegedly shielding errant developers.

Key observations made in court included:

• RERA is not effectively assisting homebuyers.
• Defaulting builders appear to be gaining advantage.
• The institution has deviated from its core objective.
• States must rethink how these authorities are structured and run.

The judges noted that the frustration among buyers is visible and widespread, raising serious questions about regulatory enforcement.

Retired bureaucrats under scanner

During the hearing, when the bench was informed that a retired IAS officer had been appointed to the authority, the Chief Justice remarked that in many states RERA has become a rehabilitation centre for retired bureaucrats. He said these authorities are filled with such officials.

The court observed that the very people for whom the law was framed — homebuyers — are left disappointed and distressed. According to the bench, they are receiving little to no meaningful relief under the present framework.

Himachal office relocation dispute

The matter before the court stemmed from a Himachal Pradesh government notification proposing to shift the RERA office from Shimla to Dharamshala. The High Court had earlier stayed this move.

The Supreme Court has now permitted the state government to relocate the office. It also directed that, for the convenience of homebuyers, the appellate tribunal should similarly be shifted to Dharamshala. The court indicated that administrative decisions should ultimately serve public interest, especially that of affected buyers.

Earlier criticism by top court

This is not the first time the Supreme Court has criticised RERA’s functioning. In September 2024, a bench of Justice Surya Kant and Justice Ujjal Bhuyan had made similar remarks.

At that time, the court had stated:

• RERA had become a shelter for former bureaucrats.
• The spirit and scheme of the Act had been undermined.
• The regulatory intent of Parliament was not being honoured.

Those observations had triggered debate within policy and real estate circles about structural reforms in regulatory bodies.

Homebuyers demand accountability

Reacting to the latest comments, the Forum for Peoples Collective Efforts said that nine years after the RERA Act came into force, there is still no guarantee that registered projects will be completed on time. The group argued that if the law cannot meet buyer expectations, it requires major reforms or even reconsideration of its existence.

For clarity, RERA was established in 2016 to bring transparency to the real estate sector, fix accountability of builders and protect buyer interests. In simple terms, it was meant to ensure that buyers receive their homes on time, under agreed terms, and without fraud. Nearly a decade later, the Supreme Court’s remarks suggest that the promise of reform remains contested.