RERA and Arbitration: Resolving Builder-Buyer Disputes in India in 2026

Before the Real Estate (Regulation and Development) Act, 2016 came into force, builder-buyer agreements typically carried an arbitration clause, and disputes between allottees and promoters were referred to arbitration. The arbitration process — slow, expensive relative to claim values, and often involving builder-friendly tribunals chosen unilaterally — was a poor remedy for individual homebuyers.

RERA changed the architecture. It established statutory Real Estate Regulatory Authorities in every state, with mandatory promoter registration, escrow requirements, and a defined adjudication pathway for allottees. RERA also created Real Estate Appellate Tribunals (REAT) for appeals.

The Supreme Court, in a series of cases from Booz Allen onwards, has classified disputes of rights in rem and statutorily-conferred rights as non-arbitrable. Builder-buyer disputes under RERA fall in the latter category — RERA confers statutory rights on allottees (registration entitlement, refund with statutory interest, possession with statutory interest, compensation) that an arbitral tribunal cannot adjudicate.

In Vidya Drolia v. Durga Trading Corporation (2020), the Court refined the non-arbitrability test: where a statute confers rights and an exclusive remedy with a statutory forum, those rights are non-arbitrable. RERA fits this template — Section 79 confers jurisdiction on the RERA Authority and REAT, and Section 88 makes RERA in addition to and not in derogation of any other law for the time being in force.

An allottee has three statutory routes: (a) the RERA Authority for registration-based complaints, refund with statutory interest, possession with statutory interest, and adjudicating officer complaints for compensation; (b) the National/State Consumer Disputes Redressal Commission under the Consumer Protection Act, 2019, with concurrent jurisdiction in many cases; (c) the High Court under writ jurisdiction in exceptional circumstances.

Arbitration is no longer available as a default route for allottee-promoter disputes, even where the builder-buyer agreement contains an arbitration clause. The Supreme Court treats such clauses as inoperative against allottees claiming RERA-conferred rights.

B2B disputes in the real-estate sector remain arbitrable. Examples: a joint development agreement between a landowner and a developer; an EPC contract between a developer and a contractor; a master franchise agreement between a hotel operator and a developer; a finance agreement between a developer and an investor. All these are commercial disputes between sophisticated parties and remain firmly within the arbitration zone.

The non-arbitrability rule applies specifically to the allottee-promoter relationship and the statutory rights conferred on allottees under RERA. It does not encroach on the broader B2B commercial fabric of the real-estate industry.

For allottees: file directly before the RERA Authority of the project's state — UP RERA, Haryana RERA, Maharashtra RERA, etc. Where the developer is also covered by a Consumer Protection Act complaint, the allottee may file in either forum but cannot litigate the same dispute in both. Where the dispute concerns RERA-registration violations or refund/possession with statutory interest, RERA Authority is the natural fit.

For developers in B2B disputes: the arbitration clause in your JV, EPC, or franchise agreement remains enforceable. Standard institutional rules (DIAC, MCIA) work well for substantial real-estate JV disputes.