If you are stuck in such a situation, here is what to do.

Mr. Alok Sharma, a resident of Aravalli Nagar, booked a 3BHK flat in the “Celestial Heights” project by Apex Developers in March 2019. He made all payments on time, as per the agreement, and was promised possession of his new home by June 2022. However, the builder has failed to meet this deadline. To Mr. Sharma’s dismay, the builder has sought two extensions from the Real Estate Regulatory Authority (RERA), pushing the projected completion date to late 2025. Local property agents have informed him that the project could face even further delays, potentially extending for several more years. Feeling helpless and with his investment stuck, Mr. Sharma is now exploring his legal options to either get possession of his flat or seek appropriate compensation for the inordinate delay.

Advice in such cases

When faced with a situation of delayed possession from a builder, it is crucial to act strategically. Here are the steps you should consider:

• Review the Builder-Buyer Agreement (BBA): This is the most critical document. Carefully examine the clauses related to the possession date, grace period, and penalties for delay.
• Issue a Legal Notice: The first formal step is often to send a legal notice to the builder through a lawyer. This notice should clearly state your grievances, reference the BBA, and outline your demands, such as immediate possession with compensation or a full refund with interest.
• File a Complaint with RERA: The Real Estate (Regulation and Development) Act, 2016 (RERA) was specifically enacted to protect homebuyers. You can file a complaint seeking possession, compensation for the delay, or a complete refund of your money with interest.
• Approach the Consumer Commission: You also have the option to file a complaint for ‘deficiency in service’ and ‘unfair trade practice’ before the appropriate Consumer Disputes Redressal Commission (District, State, or National, depending on the value of your flat).
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

Applicable Sections of Law

The primary legal framework governing such disputes includes:

• The Real Estate (Regulation and Development) Act, 2016 (RERA):
  • Section 18: This is a powerful provision for homebuyers. It states that if the promoter fails to complete the project or is unable to give possession on the agreed-upon date, the homebuyer has the right to either withdraw from the project and claim a full refund with interest or continue with the project and receive interest for every month of delay until possession is handed over.
  • Section 31: This section allows any aggrieved person to file a complaint with the RERA Authority or the adjudicating officer against any promoter, allottee, or real estate agent for any violation of the Act.
• The Consumer Protection Act, 2019:
  • A homebuyer is considered a ‘consumer’ under this Act. An inordinate delay in handing over possession amounts to a ‘deficiency in service’ and an ‘unfair trade practice’, for which you can seek relief from the consumer commissions.
• The Insolvency and Bankruptcy Code, 2016 (IBC):
  • Under the IBC, homebuyers are recognized as ‘financial creditors’. This allows them to initiate corporate insolvency resolution proceedings against a defaulting real estate company.

If you are the complainant

• Gather all your documents meticulously. This includes the Builder-Buyer Agreement, allotment letter, all payment receipts, bank statements showing transactions, and copies of all communication (emails, letters) with the builder.
• Maintain a clear timeline of events, from the booking date to the promised possession date and subsequent communications about the delay.
• Clearly decide on the relief you want to seek: Do you want possession of the flat along with compensation for the delay, or do you want to exit the project and get a full refund with interest? Your legal strategy will depend on this choice.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

If you are the victim

• Do not panic. The law, especially RERA, is largely in favour of the homebuyer in cases of unreasonable delays.
• Connect with other homebuyers in the same project. Forming an association or a collective group can strengthen your case and allow you to share legal costs. A group complaint often carries more weight.
• Document every interaction with the builder from this point forward. If you have a phone call, follow it up with an email summarizing the conversation to create a written record.
• Do not accept any verbal assurances from the builder. Insist on written communication for any new promises or timelines.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

How the police behave in such cases

Cases of delayed possession are primarily considered civil disputes, not criminal ones. Therefore, the police have a very limited role. If you approach a police station, they will likely advise you to seek remedy through the civil courts, RERA, or the Consumer Commission. Police intervention is only warranted if there is clear evidence of criminal activity, such as cheating, fraud, or criminal breach of trust. For instance, if the builder collected money for a project that never started or sold the same flat to multiple buyers, a criminal complaint could be filed under provisions like Section 316 of the Bharatiya Nyaya Sanhita, 2023 (which corresponds to Section 420 of the IPC). However, for simple delays in construction, the police will not register an FIR.

FAQs people normally have

Can I choose between getting a refund or taking possession with compensation?
Yes. Section 18 of RERA gives you, the homebuyer, this choice. The builder cannot force you to wait for possession if they have breached the agreed-upon deadline.

Is it better to go to RERA or the Consumer Commission (NCDRC)?
Both are viable options. RERA is a specialized tribunal for real estate matters and is often faster. Its focus is on ensuring compliance with the BBA. The Consumer Commission has a broader scope to adjudicate on ‘deficiency in service’ and can grant wider reliefs, including compensation for mental agony. You can choose the forum that best suits your case, but you cannot pursue the same relief in both forums simultaneously.

What happens if the builder has obtained an extension from RERA?
Even if RERA grants the builder an extension for project completion, your right to claim a refund or compensation for delay under Section 18 of the Act remains intact. The builder’s extension does not nullify the possession date mentioned in your specific Builder-Buyer Agreement.

What evidence is required?

To build a strong case, you will need the following documents:

• The Builder-Buyer Agreement (BBA) or Allotment Letter, which specifies the possession date.
• Proof of all payments made to the builder, such as receipts, bank statements, or loan disbursement letters from your bank.
• Any written correspondence with the builder regarding the project status and delays (emails, letters, etc.).
• The project brochure or advertisement that was shown to you at the time of booking.

How long will the investigation take?

The duration of legal proceedings can vary:

• RERA: The Act mandates that complaints should be disposed of as expeditiously as possible, preferably within 60 days from the date of filing. However, in practice, it can take anywhere from 3 to 9 months, depending on the complexity of the case and the workload of the authority.
• Consumer Commissions: Proceedings in consumer forums can take longer, typically ranging from 1 to 3 years, especially if appeals are filed in higher commissions.

The exact timeline depends on various factors, including the evidence presented, the builder’s response, and the efficiency of the chosen legal forum.

Advocate Sudhir Rao, Supreme Court of India