Introduction
The Real Estate (Regulation and Development) Act, 2016 (RERA) was enacted to bring transparency, accountability, and speedy dispute resolution in the real estate sector. While RERA is largely seen as a consumer-protection law safeguarding the interests of homebuyers (allottees), questions often arise about the rights of promoters and developers under the Act.
In Gopakumar B Nair vs. K.V. Sugunan & Ors. (Kerala High Court, 30 January 2025), the Court addressed a crucial question:
👉 Can a promoter file a complaint under RERA before the Adjudicating Officer seeking compensation from allottees for delayed payments?
Background of the Case
The promoter (appellant) filed a complaint before the Adjudicating Officer seeking compensation from allottees who had delayed payments. The allottees contested the maintainability of the complaint.
- The Adjudicating Officer dismissed the complaint, holding that RERA does not grant promoters the right to claim compensation from allottees.
- The Real Estate Appellate Tribunal upheld this order.
- The matter reached the Kerala High Court, which examined the substantive questions of law .
Key Legal Issues Examined
- Does RERA provide a substantive right to promoters to claim compensation from allottees?
- Can Section 31 of RERA be invoked by promoters to file complaints against allottees?
- Does Section 79 of RERA bar promoters from approaching civil courts for compensation claims?
Court’s Findings
1. No Substantive Right to Claim Compensation Under RERA
- Section 19(6) & (7) of RERA impose obligations on allottees to make timely payments.
- In case of delay, allottees are liable only to pay interest on the delayed amount, not compensation.
- The Court clarified that while promoters may seek interest through RERA, claims for compensation (damages, losses, etc.) fall outside the scope of RERA .
2. Section 31 Allows Complaints, But With Limits
- Section 31 permits “any aggrieved person,” including promoters, to file complaints.
- However, complaints must relate to violations of RERA provisions.
- Since RERA does not grant promoters a right to compensation from allottees, such complaints are not maintainable.
3. Civil Courts’ Jurisdiction Not Barred
- Section 79 of RERA bars civil courts from matters within RERA’s jurisdiction.
- But since promoters’ compensation claims are outside RERA, promoters may still approach civil courts for damages.
- This ensures that promoters are not left without a remedy .
Impact of the Judgment
For Promoters/Builders
- They can claim interest for delayed payments under RERA.
- For compensation beyond interest, they must approach civil courts under general contract law.
For Allottees/Homebuyers
- Protection from arbitrary compensation claims under RERA.
- Liability limited to interest on delayed payments unless promoters prove damages under general law.
For the Real Estate Sector
- Reinforces RERA’s consumer-centric nature.
- Clarifies the balance of rights and obligations between promoters and allottees.
Conclusion
The Kerala High Court, in Gopakumar B Nair vs. K.V. Sugunan & Ors. (2025), settled a critical legal question: Promoters cannot seek compensation from allottees under RERA, except for interest on delayed payments. However, they are free to pursue compensation claims in civil courts under general law.
This ruling strengthens the consumer-protection objective of RERA while ensuring that promoters are not left remediless outside its framework.
