From Fragmentation to Accountability: Real Estate Regulation and Consumer Protection in India

Abstract

Real estate is one of India’s fastest-growing sectors, contributing not only to gross domestic product but also to large-scale employment and ancillary industries. The unprecedented pace of urbanisation, however, has raised pressing concerns about environmental sustainability, consumer protection and regulatory efficiency. Until recently the sector operated in a fragmented and largely unregulated environment, which often resulted in delayed projects, diversion of funds and erosion of buyer confidence. To address these issues Parliament enacted the Real Estate (Regulation and Development) Act, 2016 (RERA), which introduced a uniform regulatory framework requiring mandatory registration of projects and real estate agents, disclosure of approvals and timelines, and escrow of 70 per cent of buyer advances to safeguard project completion (Real Estate (Regulation and Development) Act, 2016). Judicial pronouncements have reinforced the consumer-centric spirit of the Act. In Newtech Promoters and Developers Pvt. Ltd. v. State of UP, (2021) 3 SCC 790 (SC), the Supreme Court upheld the retrospective application of RERA provisions to ongoing projects to protect allottees. Similarly, environmental dimensions have been emphasised by courts. In Friends Colony Development Committee v. State of Orissa, (2004) 8 SCC 733 (SC), the Supreme Court underscored the need for strict adherence to planning norms and building regulations to protect public interest. This article critically examines the evolution of real estate regulation in India through RERA and related statutes, explores how these laws attempt to balance rapid development with transparency, accountability and sustainability, and, drawing on comparative examples and Indian case law, suggests ways to strengthen the legal framework for real estate to meet future urban and environmental challenges