Builder Declares Insolvency, Buyer Pays the Price: BJP MP Bajpai Demands RERA Overhaul in RS

Uttar Pradesh BJP MP Laxmikant Bajpai on Friday demanded a comprehensive amendment of RERA and insolvency laws in the Rajya Sabha, saying thousands of homebuyers across the country have spent their life savings and still have not received their flats, while builders escape accountability by declaring insolvency.

Raising the matter during Zero Hour in the Upper House, Bajpai acknowledged that the central government had enacted the Real Estate Regulatory Authority (RERA) law and established institutions such as the Insolvency and Bankruptcy Board and NCLAT. However, he said implementation had fallen far short of intent, particularly in Uttar Pradesh.

"RERA's implementation in Uttar Pradesh is completely flawed. Thousands of projects remain incomplete. Many builders have escaped legal accountability by declaring themselves insolvent," he said.

The MP flagged a specific injustice: in several cases, even where flats have been constructed, builders have not cleared government dues, leaving registrations stuck and buyers without legal ownership. "A builder commits the wrong, and the common citizen is punished," he said.

Bajpai called for the insolvency law to be amended so that a builder's personal assets are attached if they declare insolvency, and that they face strict punishment after thorough investigation.

He also flagged delays within RERA itself, saying that once a builder defaults, investigation must be completed in a time-bound manner and cases must not be allowed to drag on indefinitely.

"Without a strict and effective legal framework, the situation cannot improve," he said, urging the government to amend real estate and RERA laws so that lakhs of aggrieved buyers can finally get justice.