Landowners in Joint Development Projects Cannot Claim RERA Protection as Aggrieved Persons; When Are Landowners Considered Promoters Under RERA? Tribunal Clarifies the Law; Joint Development Agreements: Why Landowners May Not Qualify as Allottees Under RERA; Civil Court, Not RERA, Is the Proper Forum for Certain Development Agreement Disputes; RERA – Landowners are Co-Promoters and not “Aggrieved Persons”.
The Telangana Real Estate Appellate Tribunal, Hyderabad, in the matter of Mohammad Mustaq and others v. Sonali Housing Projects Private Limited, passed a decision on 24 October 2025.
1. Background – The complaint was filed by the landowner (complainants) in the judgment is that they are lawful owners of the land and had entered into a Joint Development Agreement cum General Power of Attorney with the developer for a residential cum commercial project, which stipulated that development would commence only upon obtaining necessary approvals from GHMC. However, the developer commenced illegal excavation without securing the required permissions. The landowners issued a legal notice for cancellation of the agreement and obtained interim court orders restraining GHMC from granting building permission to the developer. Additionally, the developer failed to register the project with the Telangana Real Estate Regulatory Authority (TGRERA) but proceeded to advertise the project falsely claiming approvals had been secured.
2. The contention of the learned Counsel for the Developer is that the Complainants being the owners of the land does not qualify as aggrieved persons/allottees/agents under the provisions of the Act, 2016. On the contrary, the Complainants are promoters as defined under the said Act, until such time an Allocation-cum-Supplementary Deed is duly executed between the parties
Definition under RERA – Section 2(zk) “promoter” means,
(i) a person who constructs or causes to be constructed an independent building or a building consisting of apartments, or converts an existing building or a part thereof into apartments, for the purpose of selling all or some of the apartments to other persons and includes his assignees; or
Definition of promoter is wide and covers all types of Promoters viz., developer, builders, GPA Holder, coloniser, contractor, Land owner in the Real Estate Project. Hence, any person who develops and sells is included within the definition of a Promoter.
Objective of the Act is to include any such person who has right or gets right in the real estate project to enter into a contract of sale with allottees and collect money thereon is responsible for delivery and meet the obligations.
The common question encountered are:
1. Is Landowner a promoter?
Ans – Yes, the words “causes to be constructed” in the definition of a Promoter brings the Landowner within the ambit of definition of a Promoter. Landowner is the person causing construction of the project, who may give the rights to a developer by way of granting development rights, GPA etc.
3. The Telangana RERA Tribunal noted that by virtue of the development agreement, the landowners were contributing land for development, participating in marketing, revenue sharing, and allotment processes, thereby assuming the role of promoters under the Act. It held that the dispute raised by the complainants did not fall within the purview of the RERA authority.
4. For the aforementioned reasons, we are of the considered view that the complainants/landowners cannot be said to be ‘aggrieved persons, to make a complaint under Section 31 (1) of the Act, 2016, and take recourse to the provisions of the Act, 2016 for redressal of their grievance, but are, in fact, Promoters as defined under Section 2(zk) of the Act, 2016. Since the complaint arises out of contractual and commercial terms of a development agreement, for which Civil Court is the appropriate forum.
5. In conclusion, the Tribunal held that the landowners could not be considered aggrieved persons entitled to seek relief under RERA, that the dispute was contractual in nature, and that the civil court was the appropriate forum. It therefore set aside the impugned order imposing penalty on the developer, holding it unsustainable in law.
Across multiple states, authorities have issued circulars confirming that landowners involved in joint development agreements, who either receive a share in revenue or area or participate in sale/marketing, are classified as “promoters” under RERA and not as allottees
1. MahaRERA under Regulation No. 38 of Maharashtra Real Estate Regulatory Authority (General) Regulations 2017, the following definition of Co-Promoter is being notified –
a. Co-Promoter means and includes any person(s) or organization(s) who, under any agreement or arrangement with the promoter of a Real Estate Project is allotted or entitled to a share of total revenue generated from sale of apartments or share of the total area developed in the real estate project. The liabilities of such Co-Promoters shall be as per the agreement or arrangement with the Promoters, however for withdrawal from designated Bank Account, they shall be at par with the Promoter of the Real Estate Project.
2. Karnataka RERA vide – Circular No /K RERA /3/2019 dated 31.10.2019 – para 6 is provided here –
a. The ‘Developer/Promoter’ shall be liable to provide the details of transaction carried out by the ‘Landowner/Promoter’ before obtaining the Completion Certificate/Occupancy Certificate for his project and the ‘Developer/Promoter’ shall ensure by asking the ‘Landowner/Promoter’ to deposit of 70% of the sale proceeds realised from the allottees of landowner share (in case of area sharing) to the Designated Account of the real estate project in case the ‘Landowner/Promoter’ does the transaction before obtaining the Completion Certificate/Occupancy Certificate.
3. Bihar RERA Regulation 6(3)
a. In cases where there is a development agreement or such like arrangement between the promoter and the landowner/s, unless otherwise mentioned in the agreement, both the promoter and the landowner shall be deemed to be promoters under the Act and shall be jointly liable for all obligations under the Act in respect of the real estate project concerned
Other cases / orders with respect to Landowners are Promoter / Not allottee
1. BEFORE THE MAHARASHTRA REAL ESTATE REGULATORY AUTHORITY MUMBAI COMPLAINT NO: CC006000000001240 –
a. On the basis of the statements of the Complainant, it is evident that the Complainant is also a Promoter (Landowner/Investor) and not an allottee. The dispute between the Complainants and the Respondent is of a civil nature between the promoter and Promoter (land owner). There is no contravention or violation of the provisions of the Real Estate (Regulation and Development) Act, 2016 or the rules or regulations made there under
2. The MahaRERA (Manoj Saunik, Chairperson, MahaRERA) in a Complaint filed by Sarjerao Rambhau Jarande and others vs M/s Sigma Ventures and others passed an Order dated 28 August 2025 –
a. The MahaRERA states that the complainants are landowners having an area share in the project and not an allottee under the Act. It is observed that the complainant at Sr. No. 1 is the landowner and after his demise the legal heirs became the owners of the land. Hence, it is stated that the complainants have failed to establish a promoter – allottee relationship for the purpose of the Act. It is concluded that the complainants neither qualify as allottees under section 2(d) nor as aggrieved persons under Section 31 of the Act.
3. A land owner, who will get certain share of built-up area in the project as per development agreement, cannot be termed as an “allottee” as defined under 2(d) of the Real Estate (Regulation and Development) Act, 2016 (RERA) – Lt. Col. Jagdish Chandra Sharma Vs. The Real Estate Regulatory Authority Rajasthan and Anr. – Rajasthan REAT
a. The Hon’ble Rajasthan REAT held that though the land owner has the certain share of built-up area in terms of number of flats, however, in absence of any agreement to sale or any transaction of amount between the appellant-complainant and the respondent-promoter, the appellant-complainant (the land owner) cannot be termed as an “allottee” as defined under 2(d) of the Real Estate (Regulation and Development) Act, 2016.
Prepared and Compiled by CA.Vinay Thyagaraj, Partner M/s. Venu & Vinay, Chartered Accountants, you can write to vinay@vnv.ca for any clarifications
Author Bio
