Supreme Court slams RERA, questions its relevance in major real estate regulation row
The Supreme Court sharply criticised RERA, questioning its effectiveness and suggesting states reconsider the regulator’s role. While allowing Himachal Pradesh to shift its RERA office to Dharamshala, the court flagged widespread dissatisfaction among homebuyers and raised concerns over regulatory accountability.
Supreme Court slams RERA in a sharp rebuke that could reshape India’s real estate regulatory framework. The apex court questioned the Real Estate Regulatory Authority’s effectiveness, even suggesting states reconsider its very existence.
Hearing a plea from the Himachal Pradesh government, the bench observed that RERA was allegedly doing little beyond “facilitating defaulting builders”. The remarks have triggered intense debate across policy and property sectors.
A bench comprising Chief Justice Surya Kant and Justice Joymalya Bagchi made the strong observations while dealing with a dispute over shifting the Himachal Pradesh RERA office from Shimla to Dharamshala.
The court’s criticism goes beyond a routine administrative disagreement. It touches the core credibility of a regulatory body created under the Real Estate Regulation and Development Act, 2016 to protect homebuyers.
RERA under scrutiny: Supreme Court questions real estate regulatory authority’s effectiveness
Supreme Court of India said people for whom RERA was created appear “depressed, disgusted and disappointed”. The bench remarked it may be time for states to rethink constituting such authorities.
The Chief Justice reportedly stated that except helping defaulting builders, the institution was doing little. Such judicial comments carry significant weight in ongoing regulatory reform conversations across India.
RERA was introduced in 2016 to bring transparency, ensure project registration, mandate escrow accounts, and provide speedy grievance redressal for homebuyers. It was seen as a landmark reform in India’s troubled property market.
However, implementation has varied widely across states. Delays in adjudication, weak enforcement of orders, and inconsistent penalties against developers have repeatedly drawn criticism from consumer groups and housing activists.
The present case arose in State of Himachal Pradesh vs Naresh Sharma, Special Leave Petition Civil No 005835 of 2026. The dispute centres on relocating the state RERA office.
The Himachal Pradesh government sought to shift the office from Shimla to Dharamshala, citing administrative reasons and the need to decongest the state capital, which the court noted is “completely over exhausted”.
Earlier, the Himachal Pradesh High Court had stayed a June 2025 state notification ordering the relocation. On December 30, 2025, it continued its interim stay.
The apex court has now stayed the High Court’s December 30 direction, allowing the state to proceed with shifting the RERA office, subject to the final outcome of the pending writ petition.
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Himachal Pradesh RERA office shift: legal, administrative and access concerns
Senior advocate Madhavi Divan, appearing for the state, argued that the relocation was purely administrative. The government maintained it aimed to reduce congestion in Shimla and streamline governance operations.
The state’s petition, filed through advocate Sugandha Anand, emphasised that the decision did not undermine the functioning of the authority but merely changed its physical location.
However, the respondent’s counsel highlighted logistical concerns. Around 90 per cent of real estate projects under RERA’s jurisdiction lie in Shimla, Solan, Parwanoo, and Sirmaur districts.
These districts fall within a 40 kilometre radius of Shimla. Counsel argued that 92 per cent of pending complaints originate from these regions, whereas Dharamshala accounts for only about 20 projects.
Access to justice emerged as a central issue. Homebuyers and developers currently approach the RERA office in Shimla and file appeals before the district judge in Shimla.
To mitigate inconvenience, the Supreme Court directed that appellate powers may shift from the Principal District Judge, Shimla, to the Principal District Judge of Dharamshala if the office relocation proceeds.
This direction attempts to ensure that litigants are not compelled to travel long distances merely to challenge RERA orders. It reflects judicial awareness of ground realities.
The larger policy question, however, remains unresolved. If the apex court’s remarks spark broader review, several states may face scrutiny over how effectively their RERA bodies function.
According to data from the Ministry of Housing and Urban Affairs, lakhs of housing units across India remain delayed. RERA was meant to curb precisely such systemic defaults.
Industry experts say the credibility of real estate regulation is critical for investor confidence and urban housing growth. Weak enforcement risks reviving the pre RERA era of opaque practices.
At the same time, abrupt dismantling of regulatory bodies could create uncertainty. Policymakers must weigh reform against stability, especially when housing demand remains strong in tier two and hill states.
The Sprouts News Special Investigation Team notes that the court’s observations may push states to audit performance metrics, complaint disposal rates, and enforcement outcomes of their RERA authorities.
For homebuyers, the issue is deeply personal. Delayed possession, stalled projects, and litigation fatigue have eroded trust. A credible regulator remains essential to restore confidence in India’s property ecosystem.
As the Himachal Pradesh High Court continues hearing the writ petition, the Supreme Court’s interim permission to shift the office stands conditional. The final outcome may shape both administrative practice and regulatory debate nationwide.
The controversy underscores a larger truth. Real estate regulation in India is at a crossroads, and the coming months could determine whether RERA evolves, reforms, or faces structural overhaul.
Unmesh Gujarathi, an investigative journalist, along with his team, has consistently stood in support of homebuyers and exposed irregularities in the real estate sector. Sprouts News firmly opposes any builder favouritism within RERA. If you are facing similar builder related issues or scams, feel free to call 9322755098.
