If you are developing or buying into an industrial park in India, this question almost certainly affects you. And the honest answer is - nobody has settled it yet.
Two State appellate tribunals — one in Maharashtra, one in Tamil Nadu, have read the exact same definitions in the RERA Act and reached opposite conclusions. No High Court has resolved the conflict. The Supreme Court has not been asked. In West Bengal, where the registration threshold is the strictest in the country, not a single order on this question has been passed.
WHAT DEFINES AN INDUSTRIAL PARK?
An industrial park, for these purposes is a tract of land that a developer assembles, and subdivides for manufacturing, warehousing and allied services. These serviced plots or built sheds are transferred in exchange for payments made over time, on the promise that the infrastructure will be completed by a specified date.
That model runs through State industrial development corporations like WBSIDCL, MIDC, TIDCO and GIDC, and increasingly through private developers approved under State-park schemes. IT parks, logistics parks, flatted factory estates and SEZs are variants of the same structure.
The common feature is one developer, multiple buyers, land subdivided into units, promised common areas, phased payments. That is exactly the structure RERA was designed to regulate.
But the bigger question, is an industrial park covered under RERA?
WHAT DOES RERA ACT ACTUALLY SAY?
The RERA Act was written to protect people who buy homes and commercial spaces from developers who take money and do not deliver. Parliament had housing in mind when it drafted the definitions. It did not write a separate chapter on industrial parks, which is exactly why the question is unsettled today. The conflict comes from two things the Act says, both of which are true at the same time.
On one hand, Section 2 (e) “Apartments” defines what types of units are covered under the scope such as flats, offices, shops, showrooms and godowns. Manufacturing premises, factories, and industrial sheds are not on that list. That gap is what Maharashtra's courts relied on to say that industrial buyers fall outside the Act's protection.
On the other hand, Section 2(zn) defines a "real estate project" to include the development of land into plots for sale. The word "plot" is not qualified by any land use at all. Parliament did not say "residential plots" or "commercial plots". It just said "plots". That gap is what Tamil Nadu's courts relied on to say that selling subdivided industrial plots triggers RERA, regardless of what the buyer plans to build.
TWO COURTS WITH A OPPOSITE VIEW
A. GMR Krishnagiri SIR Ltd v. Tamil Nadu Real Estate Regulatory Authority I Appeal no.55 of 2019 I dt. 29.09.20219)
B. Techno Drive Engineering Pvt. Ltd. v. Renaissance Indus Infra Pvt. Ltd. MREAT, Mumbai | Appeal No. AT006000000052195 | 14 October 2022
The Promoter entered into MOU with the Tamil Nadu Industrial Development Corporation. It was a joint venture under the Special Economic Zone. The Promoter raised the question of registration of the project before TNRERA and it was held that RERA is applied to the project, hence, registration is required.
The Promoter appealed before the Tamil Nadu Real Estate Appellate Tribunal and the appeal was dismissed.
The Tribunal's reasoning: RERA applies to any plot sold as real estate, including industrial plots. The Act has not distinguished between housing plots, commercial plots and industrial plots. TIDCO's involvement did not make it a non-commercial arrangement. The joint venture was carrying on a real estate business for the purpose of selling industrial plots.
As per the TNRERA order, a promoter selling subdivided industrial plots in Tamil Nadu must register under RERA. The fact that buyers will use the plots for manufacturing does not change the obligation.
Techno drive booked units in an integrated industrial area that also contained residential and commercial components. The project was registered with MahaRERA, with a promised possession by 31st May 2015. When possession was not given by the agreed date, the buyer filed a complaint seeking a refund with interest.
MahaRERA dismissed the complaint and noted that MOFA’s definition of “flat” expressly includes premised industrial purpose whereas RERA’s definition does not apply to industrial units. Techno Drive appealed the Maharashtra Real Estate Appellate Tribunal which was upheld.
Reasoning on the main question: The Tribunal read the definitions of "apartment" (Section 2(e)), "building" (Section 2(j)) and "real estate project" (Section 2(zn)) together. It held that "apartment" and "building" are explicitly limited to residential or commercial use, and "real estate project" must be read in consonance with those definitions. It does not independently bring in industrial use. Since industrial use is not mentioned anywhere in RERA, the Tribunal held it was deliberately excluded.
The Tribunal went further and looked at the Parliamentary Standing Committee's 30th Report on the RERA Bill. That Committee had specifically recommended that the definition of "building" be expanded to include industrial projects. Parliament rejected that recommendation and enacted the law without it. The Tribunal treated this as conclusive evidence of legislative intent.
The Tribunal also held that registration does not extend statutory coverage beyond what the law permits. It drew the analogy with redevelopment projects which must be registered if they have a sale component, yet RERA still does not govern the redevelopment portion of those projects.
THE POSITION IN WEST BENGAL
West Bengal is late to implement RERA in the year 2021 (specifically via notifications issued on July 29, 2021) following the Supreme Court's decision to strike down the state's alternate West Bengal Housing Industry Regulation Act (WBHIRA).
The state and the newly formed authority are now building its new jurisprudence and such an issue has not yet reached the forum. However, the registration threshold is the most important practical point. The central Act exempts projects with land of 500 sq.m. or fewer. West Bengal has lowered this and WBRERA requires registration where the land exceeds 200 sq.m. or there are more than six units — plots, flats or apartments. Two hundred square meters is roughly one-twentieth of an acre. Any industrial park exceeds it many times over.
In addition, West Bengal's own industrial park scheme adds another layer. Under the Scheme for Approved Industrial Parks, a private developer can seek State approval for a park of five acres or more. The scheme contemplates allotment of plots, sheds and spaces to units; up to 5% of the area as housing or hostel; a minimum of 10% as open space; and State incentives for developing common infrastructure.
Thus, a Promoter cannot claim that his factory plots are outside RERA and in the same shelter, sell or allot rooms and quarters in the same project without registering them.
Most developers who claim blanket exemption from RERA for their industrial parks have not accounted for the fact that the guest house they built for client visits, or the dormitory block they constructed for migrant workers, has already brought them inside the Act.