Issued RC under RERA, can be recovered within 3 years due to Limitation Act

           Issued RC under RERA, can be recovered within3 years due to limitation act

Status as on 27/09/2019


It has been more than two years since the implementation of the Real Estate Regulation and Development Act, 2016 and thousands of orders have been passed in almost all states by the RERA authorities.  That getting a favorable order or decree is only the first step for all the aggrieved homebuyers out there, the crucial step post that is the execution of these favorable orders.

The RERA Act under its ambit provides for the execution in the form of issuance of RC or better known as Recovery Certificate u/s 40 of RERA Act. That once an RC is issued by the RERA Authority, the work of recovery starts at the DM level, which goes to SDM and Tehsildar or other as per hierarchy where the unit of the homebuyer is situated.

Recently, in the month of August, the Hon’ble Supreme Court has upheld the position of homebuyers as financial creditors under Section-7 of the IBC Code,2016. Therefore, all the homebuyers can now move to NCLT under the IBC Code, 2016 for executing the orders or the issued RC as the case may be if a default has occurred.


Now, once an RC is issued and you wish to move to NLCT or any other court for implementing the RC, the first and the foremost question to apply limitation Act and check

“whether debt under RC/RERA order is time-barred due to limitation Act:”

There was a lack of clarity on the issue of whether the limitation act shall be applicable to Recovery Certificate (RC). And if yes, whether it would 12 years or another time period which would apply.

The said question has been solved by the judgment by Hon’ble Supreme Court vide order dated 02/09/2019 in the matter of Vashdeo R Bhojwani V. Abhyudaya Co-operative Bank Ltd and Ors.  in which it was held that

Based on and after the above landmark judgment, it can be interpreted that an issued RC (Recovery Certificate) can only be filed within a period of 3 years. In case it is not done within a period of three years from the date of issuance of RC (Recovery Certificate) or from the date order is passed the same shall become time-barred as per the provisions of Limitation Act


That this above-stated law applies to all the homebuyers out there and also, the RERA act nowhere has an explicit provision to this effect but the Supreme Court has clearly has decided that matter. Thus, it is high time that the aggrieved homebuyers who are yet to recover their money due to delay or suspension of project should move the NCLT/court for agitation of their rights because the clock is ticking and it won’t be long that your money will become barred by time and then you will be left with nothing but regret.

Disclaimer – The above article is based on the interpretation of related laws and judgments, which may differ from person to person. The readers are expected to take expert advice before placing reliance on it. For any clarification, please reach to our expert at or call at 8383011629




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