A Refund Order Is Not a Refund: Karnataka HC on Attachments and RERA Recovery Certificates

On January 30, 2023, the Karnataka Real Estate Regulatory Authority ordered the developer of a Bengaluru project called Max Madhura to refund a buyer's money with interest. A year later, with the refund still unpaid, the revenue authorities issued an attachment order, a Japti Hukum, for Rs 52,47,412. The developer went to the High Court. On October 30, 2026, the court sent it back to the statutory appeal route instead. Two weeks earlier, a different bench had refused to reopen an order directing officials to enforce another RERA recovery certificate.

Together, Maxworth Realty India Limited v. H N Gorakshanath (Writ Petition No. 7035 of 2024, Justice B. Pramod) and M/s Venkateshwara Infra Projects v. Sri Varun Rao B (Review Petition No. 430 of 2026, Justice Suraj Govindaraj) show how a refund order moves from paper to recovery in Bengaluru, and where a developer can and cannot challenge it.

The short answer. In Maxworth, the court held that the Rs 52,47,412 attachment order was "consequential in nature" to the K-RERA order and could not be examined independently while the RERA order itself remained unchallenged before the appellate tribunal under Section 44. In Venkateshwara, the court said that a recovery certificate issued under Section 40 of the RERA Act "is required to be implemented" so long as the underlying order has not been stayed or set aside, and dismissed the developer's review petition. The trade-off: buyers holding refund orders have courts backing enforcement, but developers keep the right to appeal, and that can still add time.

What happened in the Max Madhura case?

According to the October 30 order, the buyer, aggrieved by the non-completion of the project known as "Max Madhura", filed a complaint under Section 31 of the RERA Act, registered as Complaint No. CMP/200802/0006292. K-RERA allowed the complaint on 30.01.2023. When the developer did not comply, the buyer started recovery proceedings, notices were issued, and the developer still did not refund. The revenue authority then passed the attachment order dated 22.01.2024 for recovery of Rs 52,47,412, being the amount paid with interest, to be refunded within 60 days.

The developer challenged both the attachment and the original K-RERA order in a writ petition. Its counsel said the project could not be completed because of acquisition proceedings for Dr. Shivarama Karanth Layout, undertaken by "the Greater Bengaluru Authority (the then Bengaluru Development Authority)", and sought liberty to appeal. Counsel also submitted that an appeal requires "a pre-deposit of 30% of the amount in question as a condition precedent".

What did the buyer argue in the Max Madhura case?

The buyer's counsel told the court that "despite the lapse of a considerable period", the developer had failed to refund the amount payable under the 2023 order. Counsel argued that the developer had "an efficacious alternative statutory remedy of appeal" before the appellate tribunal, and that the attachment order had been passed "solely for the purpose of enforcing and giving effect to" the K-RERA order.

From that, the buyer's side argued that unless the K-RERA order was set aside or modified by the appellate forum, the developer could not independently challenge the attachment "without assailing the order forming the very basis of such recovery proceedings." An Additional Government Advocate appeared for the second respondent, the Special Tahsildar. As the next section shows, the court accepted the core of the buyer's argument.

Why did the court refuse to examine the attachment order?

Because the attachment simply enforced the K-RERA order. The court said: "The attachment order is thus consequential in nature and has been issued for enforcement of the substantive order". It noted that "the petitioner has not availed of the statutory remedy of appeal available under Section 44" and held: "In the absence of any challenge to the substantive order before the competent appellate forum, the consequential attachment order cannot be examined independently on the grounds urged against the substantive order."

The petition was disposed of with liberty to challenge the 2023 order before the Karnataka Real Estate Appellate Tribunal under Section 44, "subject to compliance with the statutory requirements, as applicable under law." The court allowed the developer to seek exclusion of the time spent in the writ petition for limitation purposes, to be decided by the tribunal under the Limitation Act, 1963. It made clear that it had not expressed any opinion on the merits.

What happened in the Venkateshwara case?

On 13.11.2025, the High Court, in Writ Petition No. 27766 of 2025, had noticed that the Special Deputy Commissioner had not implemented a recovery certificate issued under Section 40 of the RERA Act and issued a writ of mandamus directing that it be implemented. The court took into account the Additional Government Advocate's submission "that a post of Special Deputy Commissioner has been created to give effect to recovery certificates issued."

The developer, M/s Venkateshwara Infra Projects, sought a review of that order. Its counsel told the court that the respondent had initiated contempt proceedings alleging non-compliance. On October 15, 2026, the court dismissed the review. It said: "So long as the underlying order remains in force and has not been stayed or set aside by a competent forum, the recovery certificate is required to be implemented." It added that the earlier direction "was, accordingly, confined to securing implementation of the recovery certificate."

Can the developer still fight the refund?

Yes, but in the right forum. In Venkateshwara, the court said that if the developer is aggrieved by the RERA order or the recovery proceedings, "it is for the petitioner to avail the remedies available in law before the competent forum." If it obtains a stay, the court said, enforceability of the recovery certificate would be governed by the terms of that stay order, and if the underlying order is set aside or modified, the effect on recovery "would have to be determined in accordance with law."

In Maxworth, the developer was likewise left to appeal under Section 44. Neither court decided whether the buyer's refund was right or wrong. What both orders settle is narrower but useful for buyers: enforcement follows the RERA order unless that order is stayed or overturned in the proper forum. PropNewz reported a related ruling earlier this week in which the High Court upheld an attachment based on a final K-RERA order, and covered how appeal pre-deposits work at the Karnataka tribunal.

What do these cases mean for buyers waiting on refunds?

A K-RERA order is the start of recovery, not the end. In the Max Madhura case, a year passed between the refund order and the attachment, and almost three more before the High Court disposed of the developer's challenge. In the Venkateshwara case, the party holding the certificate needed a High Court mandamus to get a recovery certificate implemented, and then faced a review petition.

Both cases also show that those who keep pressing through the formal channels can get courts to back enforcement. The October 15 order records the State's statement that a dedicated Special Deputy Commissioner post exists to implement recovery certificates, which tells buyers which office to follow up with. Neither order sets a fresh timetable for recovery, so buyers should expect to follow up actively, in writing, rather than wait for money to arrive on its own. Keeping a clean paper trail also helps if contempt proceedings become necessary.

A seven-step checklist for Bengaluru buyers holding an unpaid K-RERA order:

1. Obtain a certified copy of the K-RERA order and note its date and complaint number.
2. Ask K-RERA how to start recovery if the developer does not pay within the time given.
3. Keep copies of every recovery notice, attachment order and recovery certificate issued.
4. Check whether the developer has filed an appeal under Section 44 and whether any stay was granted.
5. Follow up with the revenue office handling the recovery certificate, including the Special Deputy Commissioner.
6. If implementation stalls, take legal advice on approaching the High Court for directions.
7. Record every date, because the timeline matters in any later contempt or limitation dispute.

Frequently asked questions

What did the Karnataka High Court decide in Maxworth Realty v. H N Gorakshanath?

On October 30, 2026, Justice B. Pramod declined to entertain the developer's writ petition against a K-RERA refund order and a Rs 52,47,412 attachment order. The court held the attachment was consequential to the RERA order and left the developer to appeal to the appellate tribunal under Section 44, subject to statutory requirements.

What is a recovery certificate under Section 40 of RERA?

As the Karnataka High Court described it on October 15, 2026, it is a certificate issued under Section 40 of the RERA Act pursuant to an order of the Real Estate Regulatory Authority, to recover amounts due. The court said it must be implemented so long as the underlying order has not been stayed or set aside.

Can a developer stop recovery by challenging only the attachment order?

Not according to the October 30 order. The court said that without a challenge to the substantive RERA order before the appellate forum, the consequential attachment order cannot be examined independently on grounds urged against the substantive order. The developer was given liberty to appeal instead.

What should a Bengaluru buyer with an unpaid K-RERA refund order do?

Keep certified copies of the RERA order and every recovery notice, track whether the developer has appealed or obtained a stay, and follow up with the revenue authorities handling the recovery certificate. If implementation stalls, take legal advice on approaching the High Court, as the parties holding RERA orders in these two cases did.

This article summarises court orders for general information and is not legal advice. Neither order decides the merits of the underlying RERA disputes.

Last updated 2026-11-07. PropNewz Team.