Supreme Court Orders Nationwide RERA Strengthening with Six-Month Implementation Deadline

The nation's highest judicial authority has mandated comprehensive reforms to enhance the effectiveness of Real Estate Regulatory Authorities (RERAs) nationwide. The directive emerged from the Supreme Court's judgment in the case of Mansi Brar Fernandes versus Shubha Sharma and others, delivered on September 12, 2025.

Essential Reforms Mandated by the Court

The Supreme Court has outlined specific measures that regulatory authorities must implement to ensure effective oversight of the real estate sector. Each RERA must include at least one member who possesses either legal expertise or consumer advocacy experience with proven credentials in real estate matters, the judgment stated.

The court emphasized that regulatory authorities must maintain adequate staffing levels and infrastructure to function efficiently, preventing delays in order implementation. The judgment highlighted that regulatory bodies must conduct thorough due diligence before approving projects, warning that failures leading to injustice would be considered serious legal errors.

Escrow Account Management and Registration Requirements

Regulatory authorities have been given a six-month deadline to establish standard operating procedures (SOPs) for escrow accounts. These procedures must ensure transparent management of funds paid by allottees and align fund releases with actual construction progress.

The court directed that residential property transactions should be registered with local revenue authorities once buyers have paid at least 20% of the property cost. Additionally, contracts that significantly deviate from standard model RERA agreements—particularly those including returns or buyback clauses—must be supported by affidavits sworn before competent revenue authorities.

RERA's Role as Primary Grievance Forum

The Supreme Court reaffirmed that RERA serves as the primary forum for addressing homebuyer grievances and protection matters. The judgment clarified that this role remains distinct from consumer forums or the Insolvency and Bankruptcy Code to avoid jurisdictional overlap.

The court has called upon the Union government to undertake consultative exercises with states and stakeholders to harmonize RERA rules, address legislative gaps, and reduce regulatory ambiguity.

Broader Impact on Real Estate Regulation

Industry experts noted that these directives aim to transform RERAs from grievance redressal bodies into robust regulatory institutions. The judgment is expected to strengthen enforcement mechanisms, enhance accountability, and build trust in real estate regulation, particularly in cities experiencing rapid housing demand growth.

The state government in Odisha has already initiated steps to implement the Supreme Court's directives, coordinating across relevant departments to ensure compliance. This proactive approach demonstrates how states are responding to the court's comprehensive mandate for strengthening RERA frameworks nationwide.

The reforms are expected to provide greater protection to homebuyers while ensuring more transparent project approvals and fund management. The directive particularly emphasizes protecting senior citizens through enhanced contract scrutiny and affidavit requirements for non-standard agreements.

These comprehensive changes represent a significant step toward modernizing India's real estate regulatory framework, with the Supreme Court's judgment setting clear timelines and accountability measures for implementation across all states and union territories.