Even years after the implementation of the Real Estate Regulation and Development Act (RERA), many major builders in Karnataka are disregarding recovery orders from the Karnataka Real Estate Regulatory Authority (K-RERA). Consequently, homebuyers with favorable rulings find themselves struggling for justice through courts and bureaucratic channels.
When RERA was launched, there was hope that victims of real estate fraud would quickly receive justice. Unfortunately, that hope has largely gone unfulfilled. A striking example is the fact that ten major builders owe a collective ₹347 crore in penalties, yet have not made any payments.
Recent information acquired through an RTI query reveals that as of May 15, K-RERA had issued 656 revenue recovery certificates (RRCs) against prominent builders/promoters in 565 cases, amounting to ₹366.20 crore. However, actual recovery has only occurred in 62 cases, totaling a mere ₹18.70 crore. The majority, 594 cases, have unpaid penalties amounting to ₹347.44 crore.
Activists point out that despite the substantial outstanding sum, K-RERA has shown little interest in pursuing strict enforcement actions. Complainants claim that the authority is deflecting responsibility onto revenue officers.
Buyers caught in a legal quagmire
According to Section 63 of the RERA Act, non-compliance with authority orders should incur daily penalties on builders, potentially up to 5% of the estimated project cost. Nevertheless, K-RERA has not effectively implemented Section 53 of the Act.
“Although homebuyers have received favorable rulings, many remain unaware of enforcement procedures. If RERA officials can’t enforce their own orders, buyers have no choice but to resort to civil courts, which is unwieldy,” stated an activist.
