The Karnataka High Court has delivered a significant judgment stating that orders issued by the Karnataka Real Estate Regulatory Authority (K-RERA) and its Appellate Tribunal cannot be enforced through execution petitions filed before civil courts. The court also clarified that RERA orders do not fall within the definition of a “decree” under the Civil Procedure Code (CPC).

This decision is expected to have major implications for thousands of real estate disputes currently pending before RERA. A single-judge bench of Justice M Nagaprasanna allowed three petitions filed by Mantri Developers Pvt. Ltd., which had challenged civil court orders that rejected the builder’s plea contending that civil courts have no authority to enforce RERA orders.

After examining the legal framework of the RERA Act, the court observed that Section 40(1) allows recovery of compensation or penalties imposed by RERA along with interest, treating them as arrears of land revenue. Further, under Section 79, civil courts are barred from entertaining suits or proceedings related to RERA orders or disputes.

While Rule 26 of the Karnataka RERA Rules states that RERA orders may be enforced in the same manner as civil court decrees, the court pointed out that when RERA is unable to execute its own orders, such matters may be transferred to the Principal Civil Court. Even then, RERA orders do not fall under the legal definition of decrees. Only when the Tahsildar is unable to execute RERA’s directions can a civil court be approached.

Revisiting the concept of “decree” under Section 2(2) of the CPC, the court stressed that three essential conditions must be met: The decision must arise from a suit; The proceeding must begin with a plaint and end with a decree; The court must conclusively determine the rights of the parties.

RERA proceedings, however, are only complaint-based and do not originate from suits. Therefore, RERA orders cannot be treated as decrees and cannot be executed by civil courts. The judgment also relied on several Supreme Court and High Court decisions. While setting aside the civil court orders that had earlier rejected the builder’s objections, the High Court noted that homebuyers are free to pursue alternative remedies through revenue authorities for execution of RERA orders.

In many cases from 2023, K-RERA had issued orders in favour of homebuyers. To enforce these orders, buyers approached civil courts with execution petitions. Builders objected, arguing that civil courts lacked jurisdiction under Section 79 and that Rule 26 clearly outlines how RERA orders should be executed.

Buyers countered that RERA orders are equivalent to civil decrees and can therefore be executed by civil courts.

With this latest judgment, enforcement of thousands of RERA and Appellate Tribunal orders is now uncertain. Legal experts say that for RERA to retain its effectiveness and ensure enforcement of its orders, it may need to either approach a Division Bench in appeal or recommend suitable amendments to the CPC through the state government.