December 25, 2025

In a significant decision that reinforces homebuyer protections under the Real Estate (Regulation and Development) Act, 2016 (RERA), the Karnataka Real Estate Regulatory Authority (K-RERA) has ruled that landowners can be deemed “promoters” in certain scenarios. This ruling, dated October 30, 2025, stemmed from a delayed possession complaint where a pending partition dispute among family members prevented the execution of sale agreements, despite the apartments being ready and an Occupancy Certificate (OC) obtained.

The Case Background

The dispute involved homebuyers who had purchased apartments in a housing project developed under a joint development agreement signed on October 3, 2019, between the builder, the landowner, and others. The apartments allocated to the landowner’s share were sold to the buyers, but possession was withheld due to an ongoing legal partition case involving the landowner’s family.

The builder completed construction and secured the OC, but the landowner’s internal family dispute blocked the registration of sale deeds and handover of keys. Frustrated homebuyers approached K-RERA, seeking compensation for the delay under Section 18 of the RERA Act, which entitles allottees to interest for every month of delay if possession is not handed over as promised.

The landowner argued that they did not qualify as a “promoter” under Section 2(zk) of the RERA Act, claiming the builder alone bore responsibility.

K-RERA’s Key Findings

K-RERA rejected the landowner’s defense, holding that landowners fall within the definition of “promoter” as per Section 2(zk). This broad definition includes any person who develops land in exchange for a share in the developed area or sale proceeds.

The authority referenced its own Circular No. KRERA/Circular/3/2019 dated November 6, 2019, which explicitly states that if a landowner grants development rights to a builder in return for a share in the constructed area or revenue, the landowner is deemed a promoter.

Consequently:

• Both the developer and landowner are jointly responsible for project completion, possession handover, and sale deed execution.
• The delay caused by the partition dispute did not absolve the landowner of liability.
• The authority ordered the landowner to pay ₹6 lakh (some reports mention ₹6.5 lakh) as interest compensation to the affected homebuyers for the violation of timely possession obligations.

Implications for Homebuyers and the Real Estate Sector

This ruling is a major win for homebuyers, emphasizing that internal disputes between developers and landowners cannot be used as excuses to deny possession or compensation. It aligns with the core objective of RERA: protecting allottees from delays and ensuring accountability.

Key takeaways:

• Broader Promoter Liability: Landowners in joint development agreements (common in India) cannot evade RERA responsibilities if they benefit from the project.
• No Escape from Internal Disputes: Family or legal issues among landowners do not override statutory duties to buyers.
• Strengthened Buyer Rights: Homebuyers can hold multiple parties accountable, increasing chances of timely redressal.

Similar precedents exist in other states, such as Maharashtra, where housing societies or landowners sharing revenue/FSI have been treated as promoters. However, this K-RERA order specifically addresses partition disputes, setting a precedent for Karnataka.

For developers and landowners entering joint ventures, this underscores the need for clear agreements that address potential disputes upfront to avoid joint liability.

Homebuyers facing similar delays are encouraged to file complaints with K-RERA promptly, as the authority has consistently upheld Section 18 rights, often citing Supreme Court judgments affirming unconditional interest for delays.

As India’s real estate sector matures under RERA, such rulings promote transparency and trust, ensuring that ready flats translate to actual possession—without buyers bearing the brunt of behind-the-scenes conflicts.

  HomebuyerRights, KRERA, RealEstateIndia