Rajasthan RERA: Resort Villas Under Sale–Leaseback Model Qualify as Real Estate Projects, Registration Mandatory

April 16, 2026 : The Rajasthan Real Estate Regulatory Authority (RERA) has ruled that resort villas sold under a sale-and-leaseback arrangement fall within the definition of a “real estate project” under the Real Estate (Regulation and Development) Act, 2016, and must be registered. It further held that purchasers in such schemes are “allottees” entitled to statutory protection.

The decision was delivered by Member Sudhir Kumar Sharma while adjudicating complaints against Keemaya Resorts & SPAS LLP concerning the “New World Jaipur Resort” project.

Background

The project was marketed as an investment opportunity offering “pool serviced villas” with assured returns through a Perpetual Lease Aggregation Agreement (PLAA). Buyers purchased villas which were then to be leased back to a resort management entity for commercial exploitation.

As noted in the order (see pages 2–4), the developer projected early possession timelines and promised income returns, but failed to execute agreements, provide documentation, or hand over possession despite receiving substantial payments.

Developer’s Defence

The respondent argued that the project was a hospitality venture structured as a revenue-sharing model, where buyers were merely investors and not “allottees.” It relied on the PLAA framework to contend that the transaction was commercial in nature and outside RERA’s scope (pages 8–10).

Authority’s Findings

Rejecting these submissions, the Authority undertook a detailed examination of the brochure, sale deeds, and PLAA:

• It found that villas were first sold to buyers, and only thereafter subjected to leaseback arrangements.
• The structure could not “disguise or override” the true nature of the transaction, which remained a sale of immovable property (pages 18–21).
• Payment of stamp duty as a sale deed reinforced the conclusion that the transaction was fundamentally a sale.
• The inclusion of lease clauses within sale documents was treated as a hybrid structuring that complicated the arrangement but did not alter its legal character.

The Authority emphasized that under property law, sale and lease are distinct, and combining them cannot defeat statutory protections.

Allottee Status Clarified

Interpreting Section 2(d) of the Act, the Authority held that purchasers of such villas clearly fall within the definition of “allottees,” regardless of subsequent commercial use. The fact that units were leased back for revenue generation did not dilute buyer rights.

Registration Requirement

The Authority concluded that the project squarely met the definition of a “real estate project” under Section 2(zn) and was required to be registered under Section 3. It also relied on its earlier clarification dated 24.02.2025 that projects involving sale followed by leaseback are not exempt from registration (page 23).

Relief Granted

Having found violations of the Act, the Authority:

• Directed refund of ₹19.60 lakh to each complainant with interest at 10.80% per annum
• Imposed a penalty of ₹50 lakh under Section 59 for non-registration
• Ordered immediate registration of the project

(See operative directions on page 25.)

Key Takeaway

The ruling reinforces that developers cannot avoid RERA compliance by packaging real estate sales as investment or hospitality products. Sale-and-leaseback structures, even when framed as revenue-sharing ventures, remain subject to the Act if they involve transfer of real estate units.

Case Title: Anuj Singh v. Keemaya Resorts & SPAS LLP; Sapna Singh (Deceased) Through Legal Heirs v. Keemaya Resorts & SPAS LLP
Case Nos.: RAJ-RERA-C-N-2024-7720 & 7731
Coram: Sudhir Kumar Sharma (Member)