By AI Powered PMC Akbar Jiwani, Special Correspondent: Real Estate for Realnewsofindia.com
Four months after it took effect, the decriminalisation of Section 68 of the Real Estate (Regulation and Development) Act, 2016 (RERA) is emerging as one of the more consequential — and contested — reforms to India’s real estate regulatory architecture in recent years, with legal commentators now sharpening their critique of what the change actually delivers for homebuyers.
What changed. Section 68 previously allowed criminal prosecution — up to one year’s imprisonment, on top of daily fines that could cumulatively reach 10 per cent of a property’s cost — against any party, allottee or promoter, who failed to comply with an order of a RERA Appellate Tribunal. Under the Jan Vishwas (Amendment of Provisions) Act, 2026, that imprisonment clause has been removed entirely. Non-compliance now attracts only a monetary penalty, capped at up to 10 per cent of the cost of the plot, apartment or building, to be levied through administrative adjudication rather than a criminal court. The Ministry of Housing and Urban Affairs formally notified the change with effect from May 7, 2026 (notification S.No. 70), following the Bill’s passage by the Lok Sabha on April 1, 2026.
Part of a much larger clean-up. The RERA change is one small piece of a sweeping legislative exercise: the Jan Vishwas (Amendment of Provisions) Act, 2026 decriminalises minor, technical non-compliances across 79 central laws and 784 provisions — nearly four times the scope of the original 2023 version of the Act, which had covered 42 laws and 183 provisions. The government’s stated philosophy, as reflected in the amendment’s framing, is that criminal law should not be the default response to regulatory lapses, and that enforcement should move from magistrates’ courts to faster, more accessible administrative officers wherever the underlying conduct does not involve fraud or wilful violation.
A federal wrinkle. Because real estate sits on the Concurrent List of the Constitution, this central amendment automatically overrides state-level RERA frameworks. States will need to formally notify their own adjudicating officers to administer the new civil-penalty mechanism, replacing the earlier practice of routing non-compliance cases to magistrates — a transition industry watchers say could take months to complete uniformly across states.
The pushback. Not everyone in the legal fraternity is convinced the reform addresses what actually ails RERA enforcement. A widely circulated critique published in Bar and Bench argues that the criminal penalty under Section 68 was, in practice, barely ever invoked in RERA’s nine years of existence — making its removal largely symbolic. The real grievance for homebuyers, the column contends, lies elsewhere: recovery certificates issued under Section 40 to enforce refund orders against defaulting developers routinely sit with district collectors for months or years without yielding results, while criminal provisions against errant promoters under Sections 63 and 64 are rarely invoked to begin with. Critics also point to the Supreme Court’s 2025 ruling in Mansi Brar Fernandes, which flagged persistent staffing and expertise gaps within RERA authorities and tribunals — structural problems that a legislative tweak to Section 68 does nothing to resolve. The broader worry, as framed in the column, is that the amendment nudges RERA’s character further toward “a statute about doing business” and away from its founding mandate as a homebuyer-protection law.
Why it matters for the sector. For developers and allottees alike, the shift to civil penalties is likely to be read as a net positive on paper — it reduces the coercive weight hanging over allottees who fall foul of tribunal orders, and aligns with the government’s broader ease-of-doing-business push ahead of India’s real estate sector eyeing sustained double-digit growth through the rest of the decade. But the debate now unfolding among legal practitioners is a reminder that headline decriminalisation numbers do not, by themselves, translate into faster refunds, better-staffed tribunals, or stronger accountability for non-performing promoters — the issues that continue to dominate homebuyer grievances across RERA authorities nationwide.
