Even years after the enactment of the Real Estate Regulation and Development Act (RERA), major builders in Karnataka are ignoring recovery orders issued by the Karnataka Real Estate Regulatory Authority (K-RERA). As a result, aggrieved homebuyers, despite having orders in their favour, are left chasing justice through courts and government offices.
When RERA was introduced, there was optimism that victims of real estate fraud would receive swift relief. However, that promise has remained largely unfulfilled. A glaring example is the fact that just 10 major builders collectively owe Rs.347 crore in penalties to homebuyers but have yet to pay up.
According to information accessed through an RTI query, as of May 15, K-RERA had issued 656 revenue recovery certificates (RRCs) against leading builders/promoters in 565 cases, amounting to `366.20 crore. Yet, actual recovery has occurred in only 62 cases, totalling just `18.70 crore. The remaining 594 cases involve unpaid penalties totalling Rs.347.44 crore.
Activists said that despite such a large outstanding amount, K-RERA has shown little interest in taking stringent action. The authority appears to be shirking responsibility by passing the buck to revenue officers, complain homebuyers.
Buyers trapped in legal limbo
As per Section 63 of the RERA Act, failure to comply with authority orders should attract daily penalties on builders, potentially up to 5% of the estimated cost of the housing project. However, K-RERA has failed to implement Section 53 of the Act effectively.
“Even though homebuyers have favourable orders, many are still in the dark about enforcement mechanisms. If RERA authorities themselves cannot enforce their orders, buyers must take the matter to civil courts, which is not a practical solution,” said an activist.
