Karnataka RERA Recalls Orders Transferring Decrees To Civil Courts Without Hearing Affected Parties

The Karnataka Real Estate Regulatory Authority (K-RERA) has recalled its own earlier orders permitting transfer of decrees to the civil court, holding that such orders were void for breach of natural justice and that decree holders must first seek execution before the Authority.

A coram of Chairman Rakesh Singh and Member Gurijala Ravindranadha Reddy, in an order dated November 17, 2025, held that “failure to hear a necessary party renders the order void for violation of natural justice,” and reaffirmed that any such order “falls within the category of decisions passed without jurisdiction.”

The authority observed that orders passed without notice to an affected party strike at the root of adjudication and cannot be sustained.

The dispute arose from objections raised by allottees of the “Nitesh Long Island” residential project in Bengaluru, who alleged that the developer had failed to complete the agreed infrastructure and common facilities.

The issue was resolved through a Joint Memo recorded before the Lok Adalat on February 11, 2023, which attained the status of a civil court decree. Subsequently, the allottees filed Decree Transfer Petitions under Sections 40 and 57 of the RERA Act seeking transfer of the decree to the competent civil court, which the Authority allowed without issuing notice to the developer.

The developer challenged the ex-parte Decree Transfer Petition orders, contending that they were legally unsustainable as they were passed without notice or hearing and in violation of principles of natural justice. The developer also asserted that it had substantially complied with its obligations under the Joint Memo.

During the proceedings, the authority directed a technical committee led by an Assistant Executive Engineer of Karnataka RERA to conduct a spot inspection. In its report dated May 23, 2025, the Committee found that while certain components had deteriorated due to poor maintenance, the major infrastructure and facilities contemplated under the Joint Memo had been completed.

Both parties accepted the Committee's assessment that the remaining deficiencies were “minor, incidental and technical in nature and not attributable to deliberate non-compliance by the Developer.”

Recalling its earlier orders, the Authority held that permitting decree transfer without first undertaking execution proceedings was contrary to Section 38(2) of the Act, which mandates adherence to principles of natural justice.

On its power to recall, the Authority observed, “On the issue of power to recall, this Authority is guided by Asit Kumar Kar, Budhia Swain and Indian Bank and subsequent authorities, which recognizes/affirm the inherent power of tribunals and quasi-judicial authorities to recall orders passed without jurisdiction or in violation of natural justice or due to procedural irregularities that strike at the root of the decision.”

It further ruled that decree holders cannot circumvent RERA and immediately seek transfer of decrees to Civil Courts, holding that execution must first be sought before the Authority, where non-compliance must be established after notice to the judgment debtor and an opportunity of hearing.

On this basis, the earlier Decree Transfer Petition orders were recalled, with liberty granted to the complainants to initiate execution proceedings before RERA.

Case Title: MG Ashok Rao & Ors. v. Nitesh Estates Limited & Ors.

Complaint Numbers: CMP/00001/2023, CMP/00204/2023

For the Respondent : Advocate Ahaan Mohan

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