In a setback for homebuyers facing delayed possessions, the Maharashtra Real Estate Appellate Tribunal (MREAT) has confirmed that certain small-scale real estate projects are fully exempt from registration under the Real Estate (Regulation and Development) Act, 2016 (RERA). This leaves buyers in such projects unable to approach the regulatory authority for relief. The ruling, delivered on December 23, 2025, in the case of Deepak Sayaji Shinde vs. M/s Swarajya Developers and Builder, highlights a key limitation in RERA’s scope and serves as a reminder for buyers to carefully check project details before investing.
The dispute centres on “Sankalp Niwas,” a residential project in Khed, Pune, developed by Swarajya Developers and Builder. Buyer Deepak Sayaji Shinde booked a flat in October 2012 for ₹8,10,000, paying over ₹9.94 lakh including stamp duty. Possession was promised by October 2014, but the project remained incomplete, with only about 85% work done even years later. Spread over roughly 400 square metres and consisting of 24 units, the project was never registered under RERA despite being ongoing when the Act came into effect in 2017.
Shinde approached MahaRERA in 2019, asking the authority to direct the developer to register the project. MahaRERA rejected the plea in February 2020, holding that the project was exempt because its land area was below 500 square metres. On appeal, MREAT upheld this view and dismissed Shinde’s challenge.
The core issue was the interpretation of the exemption clause in Section 3(2)(a) of RERA, which states: no registration is required where “the area of land proposed to be developed does not exceed five hundred square meters or the number of apartments proposed to be developed does not exceed eight inclusive of all phases.”
In Maharashtra, this provision is interpreted disjunctively—the word “or” means a project is exempt if either condition is satisfied: land area ≤500 sq m (even if more than eight units) or ≤8 units (even if land area exceeds 500 sq m). Since the land here was under 500 sq m, the project qualified for exemption regardless of having 24 units. MahaRERA has reinforced this through its circulars, stating clearly that small-plot projects do not need registration irrespective of unit count, and vice versa for projects with few units.
Section 3(1) of RERA generally mandates registration for all real estate projects to ensure transparency and timely delivery, including ongoing projects without completion certificates as of May 2017. However, the exemptions under Section 3(2) override this for qualifying small projects, meaning promoters face no obligation to register, disclose details, or comply with RERA’s timelines and penalties.
For buyers in such unregistered projects, RERA’s powerful remedies—such as claiming interest for delays under Section 18, seeking refunds, or imposing penalties on developers under Section 59—are completely unavailable.
What options remain for affected homebuyers?
- Consumer Protection Act, 2019: File a complaint for “deficiency in service” before District, State, or National Consumer Commissions. Buyers can seek possession, compensation for delays (often with interest), or refunds. This has become the primary forum for grievances in exempt projects.
- Civil Courts: Sue for specific performance of the agreement (to force delivery of the flat), damages for breach of contract, or other relief under the Indian Contract Act or Specific Relief Act. While effective, civil suits can be slower and more expensive.
- Criminal Action (in extreme cases): If there is evidence of cheating or fraud, file an FIR under relevant sections of the Indian Penal Code.
- Other Routes: In rare cases involving large dues, buyers may explore insolvency proceedings against the developer.
This judgment is a wake-up call for homebuyers: always check the project’s land area and unit count on the MahaRERA portal before booking. While the exemption aims to reduce regulatory burden on small developers, it can leave buyers in limbo, prompting ongoing debates about whether RERA needs amendments for better protection in such scenarios.
Also Read: MahaRERA Orders Refund, Possession in Lapsed Bhayandar Project; Promoter Absent from Proceedings
