The Supreme Court of India sharply criticised the Real Estate Regulatory Authority (RERA), and observed that the institution was doing nothing, except facilitating defaulting builders.
A bench of Chief Justice Surya Kant and Justice Joymalya Bagchi made the observations on Thursday while hearing a case involving the Himachal Pradesh RERA.
"Except facilitating the builders in default, this institution is doing nothing. Better abolish this institution, we don't mind that," reported PTI, quoting the CJI.
A bench stated that the people for whom RERA was created were "completely depressed, disgusted and disappointed."
"...high time that all the states should revisit and rethink of even constituting this authority," the bench said.
Why was RERA Introduced?
India's real estate sector grew rapidly in the early 2000s, with large residential projects coming across major cities of most states. During this growth, there was no specific law governing this sector. In some cases, people kept paying their loan instalment even when the projects they funded through debt were not completed on time.
In Noida Extension, builders even sold flats without completing any work on the land.
Owing to these challenges, the government introduced the Real Estate (Regulation and Development) Act, 2016, which came into force on May 1, 2017.
The Act promised to protect homebuyers rights, ensure financial discipline, and bring transparency to the sector.
According to the Union Ministry of Housing and Urban Affairs, RERA has been established in all states and Union Territories, except Ladakh, Nagaland, Sikkim, Manipur, and Mizoram.
RERA's scope of work
The law asks developers to keep 70 percent of the funds collected from buyers in a separate account, which must be used only for construction of the project. The funds in this account can be withdrawn only after verification by architects, project engineers, and chartered accountants.
This ensured the timely completion of projects, as developers could only draw money from the account for construction purposes.
According to the law, developers must register projects exceeding 500 square metres or more than eight apartments before launch and provide detailed information about the project, including layout, carpet area, and timeline.
In Maharashtra, the RERA banned sales for 189 delayed projects in Pune and Pimpri-Chinchwad, and builders continued selling flats, citing technical issues on the RERA website. Builders' association CREDAI supported this, claiming delays were administrative rather than project-related.
When Supreme Court Expressed Concerns
The Supreme Court has repeatedly expressed concern over RERA. In September 2024, a bench of Justice Surya Kant and Justice Ujjal Bhuyan said RERA had become a “a haven for former bureaucrats who sabotaged the RERA Act.”
"We don't want to talk about RERA. It has become a rehabilitation centre for former bureaucrats who have sabotaged the entire scheme of the law," the Supreme Court observed.
Furthermore, in September 2025, a bench of Justices JB Pardiwala and R Mahadevan instructed states to ensure that RERA has adequate infrastructure, resources, and legal expertise.
The court also mandated that every RERA member must include at least one legal expert or consumer advocate with proven experience in the real estate sector, and all projects should undergo thorough due diligence before approval.
According to NDTV, RERA has 1.58 lakh projects registered across India, 1.12 lakh agents registered. The regulatory body also received 1.89 lakh complaints, of which 1.55 lakh were resolved.
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