Karnataka RERA Issues Stern Warning to 155 Builders Over Delayed Quarterly Filings
In a significant move to strengthen homebuyer protections and enforce regulatory compliance, the Karnataka Real Estate Regulatory Authority (K-RERA) has taken strict action against 155 promoters across the state. These developers have failed to submit their mandatory quarterly project progress reports, a critical requirement under RERA guidelines.
Penalties and Deadlines: A Clear Ultimatum
The authority has issued a firm warning, stating that promoters who continue to neglect this obligation face severe financial penalties. These include fines of up to 5% of the total estimated project cost, along with an additional Rs 25,000 for each quarter where reports are missing. However, K-RERA officials clarified that these 155 builders have not yet been officially declared as defaulters.
"If they do not file returns by the end of the current financial year, then necessary action will be taken against them," a senior K-RERA officer emphasized. The authority has set a final deadline of March 31 for promoters, including those involved in related legal petitions, to submit all pending quarterly updates without incurring penalties.
Recovery Proceedings to Begin from April 1
Starting April 1, K-RERA will initiate recovery proceedings against promoters for any delayed or non-submitted quarterly updates. This crackdown follows a circular issued on February 7, which established specific fines and timelines for the submission of overdue reports covering the period from 2017-18 to 2024-25.
This recent directive builds upon an earlier circular dated September 3, 2020, and aligns with an order from the Karnataka High Court dated September 19, 2025. Notably, several promoters had previously challenged the 2020 circular in the High Court, which subsequently quashed the order. The court, however, clarified that this decision does not prevent the imposition of fees through legally recognized means.
Builders' Perspective and Procedural Nature
Builders have acknowledged that quarterly filings are largely procedural and technical in nature. While they agree that penalties are justified, they argue that such fines should be "acceptable, nominal and proportionate" to ensure fairness and encourage compliance without undue financial burden.
Importance of Timely Reporting for Project Monitoring
A senior K-RERA official highlighted the critical role of timely quarterly reports in effective project oversight. "The exercise helps the authority to track project progress. In case of delays, we can identify such projects early. If homebuyers do file a complaint, then we can take action against the promoter," he explained. This proactive monitoring is essential for safeguarding homebuyer interests and ensuring project transparency.
Homebuyers' Mixed Reactions to the Crackdown
While homebuyers have welcomed K-RERA's stringent stance, opinions on its potential effectiveness are divided. Many appreciate that the measure empowers authorities to take suo motu action if project timelines are not met. However, a common concern is that the current penalty structure may be too low to create a substantive impact.
Critics point out that despite previous circulars, quarterly project updates are often not properly monitored. The lack of a clear project completion policy further raises questions about accountability and long-term enforcement.
Detailed Penalty Structure and Payment Calendar
The penalty framework is meticulously outlined to cover various periods of non-compliance:
- Period from Q2 2017-18 to Q2 2018-19: Treated as a single quarter due to web portal availability from Q2 2018-19, with a penalty of Rs 25,000.
- For Q3 and Q4 of 2018-19: Quarterly penalty of Rs 25,000 each, totaling Rs 50,000.
- For each financial year from 2019-20 to 2024-25: Quarterly penalty of Rs 25,000, amounting to Rs 1 lakh annually.
- As per the 2020 order: Rs 10,000 penalty for a one-month delay after the due date, doubling to Rs 20,000 thereafter.
Promoters are required to submit quarterly project updates through the K-RERA portal according to the following deadlines:
- Q1: July 15
- Q2: October 15
- Q3: January 15
- Q4: April 15
This comprehensive crackdown underscores K-RERA's commitment to enhancing transparency and accountability in Karnataka's real estate sector, ultimately aiming to protect homebuyers and promote timely project completions.
