The Karnataka High Court has set aside a circular issued by the Real Estate Regulatory Authority-Karnataka (RERA-K) that imposed a ‘delay fee’ on real estate promoters and developers for submitting quarterly updates and annual audit statements after their respective deadlines. This judicial decision mandates RERA-K to refund lakhs of rupees previously collected under this provision.
Justice M. Nagaprasanna delivered the order, which addressed over 75 petitions challenging the legality of the circular. The Court concluded that the Real Estate (Regulation and Development) Act, 2016, and its associated rules do not grant the Authority the power to levy or recover fees beyond those explicitly authorized by law.
The RERA-K circular, dated September 3, 2020, had established a ‘delay fee’ of ₹10,000 for delays up to one month and ₹20,000 per month for delays exceeding one month. These charges were collected from the date of the circular and retrospectively from the 2018-19 fiscal year. The High Court further noted that the circular lacked a specified source of power within the RERA Act for the imposition or calculation of such fees.
Source: www.thehindu.com