Jan Vishwas Amendment Bill 2026 seeks to replace imprisonment with a monetary penalty of up to 10% of property cost for non-compliance with Real Estate Appellate Tribunal orders
By The Realty Times | Real Estate News Services
NEW DELHI:
In a move that could provide relief to homebuyers, the Centre has proposed
removing the provision for imprisonment of up to one year for property
allottees who fail to comply with orders issued by the Real Estate Appellate
Tribunal under the Real Estate (Regulation and Development) Act, 2016.
The proposed amendment seeks to replace the existing
imprisonment provision with a monetary penalty that may extend up to 10% of the
cost of the plot, apartment or building concerned. The change forms part of the
Jan Vishwas (Amendment of Provisions) Bill, 2026, which was introduced in the
Lok Sabha by Minister of State for Commerce and Industry Jitin Prasada on March
27, 2026, according to a PTI report published by ETRealty on March 28.
Under Section 68 of the RERA Act, 2016, an allottee
who fails to comply with or contravenes an order or direction issued by the
Real Estate Appellate Tribunal may face imprisonment of up to one year, a fine,
or both, subject to the applicable legal provisions.
The Centre's proposed amendment seeks to remove the
imprisonment provision and introduce a monetary penalty of up to 10% of the
property's cost.
According to the Bill, an allottee who fails to comply
with the tribunal's orders would be liable to a penalty that may extend to 10%
of the cost of the plot, apartment or building concerned.
The proposal represents a shift towards financial
penalties rather than imprisonment for this specific category of
non-compliance.
The proposed change could reduce the risk of
imprisonment for homebuyers who fail to comply with directions issued by the
Real Estate Appellate Tribunal. However, it does not remove the obligation to
follow tribunal orders.
If enacted in its proposed form, the amendment would
retain a financial consequence for non-compliance, with the penalty potentially
reaching 10% of the property's cost.
For buyers, this means that compliance with tribunal
directions will remain important, even if the punishment framework changes.
The proposal should not be interpreted as a general
exemption for homebuyers from RERA provisions or as protection against all
forms of legal action arising from property disputes.
The Real Estate (Regulation and Development) Act,
2016, was introduced to promote transparency, accountability and consumer
protection in the real estate sector.
The legislation requires covered real estate projects
to be registered with the relevant state or Union Territory real estate
regulatory authority, subject to statutory exemptions. It also establishes
mechanisms through which homebuyers and other stakeholders can seek redressal
for grievances.
Real Estate Appellate Tribunals hear appeals against
specified orders passed by real estate regulatory authorities and adjudicating
officers. Their directions are an important part of the regulatory framework,
and the proposed amendment concerns the consequences for allottees who fail to
comply with those directions.
The proposed amendment relates specifically to the
penalty applicable to allottees under Section 68. It does not, by itself,
abolish the wider obligations imposed on developers or homebuyers under RERA.
Developers must continue to comply with applicable
requirements concerning project registration, disclosures, construction
timelines and other statutory obligations. Homebuyers, meanwhile, remain
responsible for meeting their legal and contractual obligations.
The proposed change should therefore be understood as
a targeted amendment to the enforcement mechanism applicable to allottees,
rather than a comprehensive revision of the RERA framework.
The amendment was reported as a proposal under the Jan
Vishwas (Amendment of Provisions) Bill, 2026. Its final legal effect depends on
the legislative process and the provisions ultimately enacted and brought into
force.
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