Delhi Real Estate Tribunal Issues Stern Warning to RERA Over Application Delays
In a significant ruling that could transform how real estate regulatory authorities function across India, Delhi's Real Estate Appellate Tribunal has issued a stern warning against keeping builder and promoter registration applications pending for extended periods. The tribunal emphasized that such delays not only violate statutory timelines but also open doors to allegations of corruption and misconduct within the regulatory framework.
30-Day Mandate for Registration Decisions
The tribunal has directed the Real Estate Regulatory Authority (RERA) to ensure strict compliance with Section 5 of the RERA Act, which mandates that authorities must either accept or reject registration applications within 30 days of receipt. This clear timeline, according to tribunal member Lorren Bamniyal, is designed to prevent bureaucratic delays that undermine the real estate sector's transparency and efficiency.
The tribunal observed: "The bottom line is that Real Estate Regulatory Authority must act within 30 days of receipt of the application and deal with these on merits by either granting or refusing registration. Long delays, in contravention of specific timelines provided under the statute, are an invitation to allegations of corruption and mischief, which need to be avoided by taking prompt action as statutorily mandated."
DDA's Case Highlights Systemic Issues
The tribunal's observations came during the hearing of an appeal filed by the Delhi Development Authority (DDA) against a penalty of Rs 10 lakh imposed by RERA. The penalty was levied for DDA's delay in registering a multistorey housing project in Dwarka with the regulatory authority.
While RERA faulted DDA for submitting an incomplete application, the civic agency's legal representatives, advocates Anil Kumar Sharma and Vrinda Kapoor Dev, presented a compelling counter-argument. They revealed that DDA had applied for registration online on February 28, 2023, but RERA inexplicably took no action on the application for several months.
According to DDA's legal team, RERA acted almost seven months later, only then highlighting the lack of certain information and asking DDA to file a complete application. This prolonged delay formed the crux of DDA's appeal against the substantial penalty.
No Distinction Between Complete and Incomplete Applications
In a crucial interpretation of the RERA Act, tribunal member Lorren Bamniyal clarified that the legislation makes no distinction between complete and incomplete applications. This means regulatory authorities cannot use incomplete documentation as justification for indefinite delays in processing registration requests.
The tribunal member noted: "In the present case, there was no reason for the authority (RERA) to keep the application pending over a long period of time and subsequently impose a penalty of Rs 10 lakh on the appellant."
Deemed Registration Provision Activated
To prevent future delays and ensure accountability, the tribunal's order includes specific provisions for what happens when RERA fails to meet the 30-day deadline. According to the ruling:
- If RERA rejects an application, it must grant the applicant a hearing
- If RERA fails to either grant registration or reject the application within 30 days, the applicant can claim deemed registration
- Within seven days of the 30-day period expiring, RERA must provide the promoter with a registration number, login ID, and password
- This access allows promoters to create their web page on RERA's website and fill in details of their proposed project
These provisions, already embedded in the RERA Act itself, now carry the weight of judicial enforcement through the tribunal's directive for "strict compliance."
Broader Implications for Real Estate Regulation
This landmark decision has several important implications for India's real estate sector:
- Enhanced Transparency: By eliminating prolonged application pendency, the ruling reduces opportunities for corruption and ensures more predictable regulatory processes
- Developer Accountability: While protecting developers from arbitrary delays, the decision maintains their responsibility to provide complete documentation
- Regulatory Efficiency: The 30-day mandate forces regulatory bodies to streamline their processes and allocate resources more effectively
- Legal Precedent: This ruling could influence how other state RERA authorities handle registration applications across India
The tribunal's intervention comes at a critical time for Delhi's real estate market, which has seen both significant development activity and regulatory challenges in recent years. By enforcing statutory timelines that were already part of the RERA framework, the tribunal has reinforced the importance of timely decision-making in regulatory processes.
This decision serves as a reminder that regulatory authorities must balance their oversight responsibilities with efficiency and transparency, ensuring that India's real estate sector can develop within a framework that protects both developers and homebuyers while maintaining the integrity of the regulatory process.
