Rera just helping builders in default; better to abolish it: Supreme Court

All states should think of the people for whom the institution was created: Court

The Supreme Court (SC) on Thursday sharply criticised the functioning of real estate regulatory authorities (Reras) across several states, observing that they appeared to be doing little “except facilitating builders in default” and suggesting that it might be “better to just abolish this institution”.

 

A Bench comprising Chief Justice of India (CJI) Surya Kant and Justice Joymalya Bagchi made the remarks while hearing an appeal filed by the Himachal Pradesh government against a high court (HC) order that had stalled its decision to relocate the state Rera office from Shimla to Dharamshala.

 

“All states should now think of the people for whom the institution of Rera was created. Except facilitating builders in default, it is not doing anything else. Better to just abolish this institution,” the CJI observed during the proceedings.

   

Senior advocate Madhavi Divan, appearing for the state, submitted that the public interest litigation before the HC had been instituted by a property dealer. She argued that the state was well within its administrative powers to shift the headquarters.

 

Opposing the appeal, counsel for the respondent contended that the petitioner’s credentials had been placed on record before the HC and that the court was competent to examine the matter, including by appointing an amicus curiae, if required.

 

It was further argued that Rera had already faced delays in the appointment of a chairperson and that shifting the office would inconvenience stakeholders, most of whom were largely concentrated in Shimla.

 

According to the respondent, nearly 90 per cent of the properties and complaints under Rera’s jurisdiction were located in Shimla, while Dharamshala accounted for a much smaller share.

 

In its earlier order, the Himachal Pradesh HC had stayed the June 13, 2025, notification relocating the office, observing that the decision had been taken “without even identifying the alternative office place”.

 

The HC had also recorded that 18 outsourced employees were directed to be adjusted in other boards and corporations, which, in its view, would render the authority’s functioning defunct.

 

“We are of the considered opinion that the notification dated June 13, 2025, shall remain stayed until further orders, and the subsequent order directing that the 18 outsourced employees, upon their applications, be adjusted in other boards and corporations shall also remain stayed, since the same would render the functioning of Rera defunct,” the HC had said.

 

After hearing the parties, the SC set aside the interim stay and allowed the state to proceed with shifting the Rera headquarters to Dharamshala. It also directed that the principal appellate authority be relocated to the same place to ensure that litigants were not inconvenienced.

 

“With a view to ensure that persons affected by Rera orders are not inconvenienced, the principal appellate authority is also to be moved to Dharamshala,” the Bench ordered.

 

The court noted that in an earlier, similar matter, it had lifted an HC stay blocking the relocation of the Himachal Pradesh State Commission for Backward Classes from Shimla to Dharamshala. 

The case file

• Himachal Pradesh government planned to relocate the state’s Rera headquarters from Shimla to Dharamshala
• In 2025, high court had stalled government’s relocation efforts
• Respondents argued that shifting would inconvinience Shimla-based stakeholders
• Supreme Court lifted the temporary stay, allowing the state to go ahead with shifting