Section 27: Restrictions on Chairperson or Members after Cessation of Office
Section 27 of the Real Estate (Regulation and Development) Act, 2016 (RERA) restricts specified employment, professional activities and disclosures by a Chairperson or Member of a Real Estate Regulatory Authority, particularly after leaving office. The provision is intended to protect independence, prevent conflicts of interest and safeguard non-public information.
Scope and meaning of Section 27
The Authority means the Real Estate Regulatory Authority established under Section 20. Its Chairperson and Members are appointed under Sections 21 and 22. Cessation of office refers to the end of a person's tenure, whether through expiry, resignation, removal or another lawful cause. Section 27 contains restrictions applying after cessation and a separate non-disclosure duty in subsection (2).
Restrictions under Section 27(1)
Employment with an associated organisation - clause (a)
A former Chairperson or Member must not accept employment in, or connected with the management or administration of, a person or organisation associated with work under RERA. The statutory proviso excludes specified public-sector employment: employment under the appropriate Government, a local authority, a statutory authority, certain statutory corporations or a government company within Section 2(45) of the Companies Act, 2013, provided the stated non-promoter condition is satisfied. Section 2(45) defines a government company by reference to the prescribed level of Central or State Government shareholding and includes a subsidiary of such a company.
Acting in matters previously handled - clause (b)
A former officeholder must not act for another person or organisation in a specific proceeding, transaction, negotiation or case involving the Authority where the former officeholder previously acted for or advised the Authority. This prevents a switch of sides in matters personally handled while in office.
Use of non-public information - clause (c)
A former officeholder cannot advise anyone by using information acquired in the official capacity that is unavailable, or cannot be made available, to the public. This protects confidential regulatory information from private exploitation.
Employment or board positions involving prior official dealings - clause (d)
A former Chairperson or Member must not enter into a service contract, join the board of directors or accept employment with an entity with which they had direct and significant official dealings during their tenure. The prohibition addresses conflicts arising from regulatory relationships.
Confidentiality under Section 27(2)
Subsection (2) separately prohibits the Chairperson and Members from communicating or revealing to any person matters brought before them or known to them while acting in their official capacity. The statutory wording should be read together with applicable disclosure obligations and the governing legal framework, rather than treated as permission to suppress information required by law.
Full text of Section 27
(1) The Chairperson or a Member, ceasing to hold office as such, shall not-
(a) accept any employment in, or connected with, the management or administration of, any person or organisation which has been associated with any work under this Act, from the date on which he ceases to hold office:
Provided that nothing contained in this clause shall apply to any employment under the appropriate Government or a local authority or in any statutory authority or any corporation established by or under any Central, State or provincial Act or a Government Company, as defined under clause (45) of section 2 of the Companies Act, 2013, which is not a promoter as per the provisions of this Act;
(b) act, for or on behalf of any person or organisation in connection with any specific proceeding or transaction or negotiation or a case to which the Authority is a party and with respect to which the Chairperson or such Member had, before cessation of office, acted for or provided advice to, the Authority;
(c) give advice to any person using information which was obtained in his capacity as the Chairperson or a Member and being unavailable to or not being able to be made available to the public;
(d) enter into a contract of service with, or accept an appointment to a board of directors of, or accept an offer of employment with, an entity with which he had direct and significant official dealings during his term of office as such.
(2) The Chairperson and Members shall not communicate or reveal to any person any matter which has been brought under his consideration or known to him while acting as such.
Practical compliance considerations
- Before taking a new role: assess whether the prospective employer was associated with work under RERA or had direct and significant official dealings with the former officeholder.
- Before advising or representing a client: check whether the matter involved previous advice or action for the Authority and whether any non-public information would be used.
- For public-sector appointments: verify that the exact statutory exception in clause (a) applies, including the condition that the entity is not a promoter under RERA.
- During and after service: maintain confidentiality and follow applicable rules and lawful disclosure requirements.