Karnataka RERA Issues Standard Operating Procedure for Recovery of Monetary and Non-Monetary Reliefs Granted in RERA Orders

Karnataka RERA Issues Standard Operating Procedure for Recovery of Monetary and Non-Monetary Reliefs Granted in RERA Orders

Circular Details

Authority: Karnataka Real Estate Regulatory Authority (K-RERA)
Date: 28 July 2026
Subject: Procedure to be followed in case of recovery of monetary and non-monetary reliefs in terms of orders passed on complaints filed under Section 31 of the RERA Act, 2016
Legal Basis: Section 40 of the Real Estate (Regulation and Development) Act, 2016, read with Rules 25 and 26 of the Karnataka RERA Rules.

Key Directions

The circular lays down an SOP for execution and enforcement of K-RERA orders where the promoter or other judgment debtor fails to comply.

• 60-day compliance period: After 60 days from the order, K-RERA will ascertain whether the order has been complied with.

• Execution Petition: In case of non-compliance, the decree holder may file an Execution Petition through the RERA portal, along with an updated calculation statement where monetary dues are involved.

• Notice to parties: Notice will be issued to the decree holder and judgment debtor, giving the judgment debtor an opportunity to explain compliance or non-compliance.

• Additional opportunity: Where non-compliance continues, the Authority may grant a further two weeks for compliance.

• Disclosure of assets: In monetary recovery matters, the judgment debtor may be required to disclose details of movable and immovable assets, bank accounts and investments.

• Revenue Recovery Certificate: Continued failure to pay monetary dues may result in issuance of a Revenue Recovery Certificate (RRC) under Section 40(1) of RERA.

• Attachment and auction: The recovery process may extend to movable and immovable properties and bank accounts through the competent revenue authorities.

• Non-monetary relief: For orders involving non-monetary directions, K-RERA may enforce the order itself in accordance with law or transmit it to the Principal Civil Court having jurisdiction for enforcement under Section 40(2) of RERA and Rule 26.

Suggested Short Heading

K-RERA Issues SOP for Execution and Recovery of RERA Orders

This would work particularly well as a legal-news/blog heading, while the longer heading can be used as the formal title of the circular. 

 

MahaREAT Says RERA Has No Jurisdiction Over Banks Lending to Homebuyers, Refuses to Stay SARFAESI Recovery

Case Title: Kamlesh Valji Balsara & Anr. v. M/s Shree Siddhivinayak Infrastructure and Realty & Ors.
Case No.: Appeal No. AT06/01035/2025 and connected appeals

The Maharashtra Real Estate Appellate Tribunal (MahaREAT) has held that the RERA authorities do not have jurisdiction to adjudicate disputes between homebuyers and financial institutions that have extended loans to the homebuyers.

The Tribunal consequently declined to stay recovery proceedings initiated against the homebuyers under the SARFAESI Act, 2002, while restraining the promoter from creating third-party rights in the flats concerned.

Dispute Arising From Subvention Scheme

The appeals arose from disputes involving Kamlesh Valji Balsara and other homebuyers and Shree Siddhivinayak Infrastructure and Realty.

The homebuyers had booked flats in the developer's project under a subvention scheme, under which the promoter was required to bear the pre-EMI obligations until possession of the flats was handed over.

To finance their purchases, the homebuyers obtained loans from a non-banking financial company. The loans were subsequently assigned to an asset reconstruction company.

After the project was delayed and the promoter allegedly failed to fulfil its obligations under the subvention arrangement, recovery proceedings were initiated against the homebuyers under Section 13(2) of the SARFAESI Act.

Homebuyers Approached MahaRERA

The homebuyers had separately approached the Maharashtra Real Estate Regulatory Authority alleging delay in possession and seeking appropriate relief against the promoter.

By a common order dated July 31, 2025, MahaRERA allowed their complaints and directed the promoter either to refund the amounts with interest or pay interest for the delay in possession.

The homebuyers thereafter approached MahaREAT in connection with the recovery proceedings initiated by the financial institutions.

Tribunal Holds RERA Cannot Adjudicate Claims Against Lending Institutions

MahaREAT declined to interfere with the recovery action undertaken by the financial institutions.

The Tribunal distinguished cases where a financial institution lends money directly to a promoter. In such circumstances, RERA authorities may have jurisdiction in appropriate cases, including situations where a lender steps into the shoes of the promoter following a default.

The Tribunal noted that the present case was different because the loans had been advanced to the allottees and not to the promoter.

It therefore held that the contractual arrangements between the homebuyers, promoter and lending institution could not be enforced under the provisions of the RERA Act.

SARFAESI Recovery Not Stayed

The Tribunal consequently refused to grant a stay against the recovery proceedings initiated by the financial institutions under the SARFAESI Act.

However, while declining to interfere with the recovery action, MahaREAT directed that the promoter should not alienate the flats or create any third-party rights in respect of the properties involved until final disposal of the appeals.

RERA Remedy Against Promoter Distinct From Bank Recovery

The decision draws a distinction between remedies available to homebuyers against a real-estate developer under RERA and disputes arising from their independent loan arrangements with financial institutions.

While the homebuyers could pursue their RERA remedies against the promoter for issues such as delayed possession, the Tribunal held that the RERA framework could not be used to adjudicate or restrain contractual recovery proceedings undertaken by lenders against the borrowers.

Key Takeaway

The ruling reinforces the jurisdictional limits of RERA authorities in disputes involving home-loan lenders and borrowers. Where the loan has been advanced to the homebuyer rather than the promoter, disputes arising from the lending arrangement cannot ordinarily be enforced through RERA proceedings.

At the same time, the Tribunal's direction restraining the promoter from creating third-party rights in the flats preserves the homebuyers' interests in the underlying real-estate dispute while the appeals remain pending.