One of my clients recently had a case which I am explaining below and if you are stuck in such similar situation, here is what to do.
Note: Due to attorney-client privilege, I cannot disclose complete case details or identify the actual parties involved. However, I am sharing the essential facts and legal approach so that if you find yourself in a similar situation, you can understand the available solutions and legal remedies.
TL;DR: A builder’s unexplained delay in raising a demand usually signals missing approvals, financial strain, or internal mismanagement. You can send a legal notice, approach RERA, or file a consumer complaint to enforce your rights — including cancellation with full refund under Section 18 of the Real Estate (Regulation and Development) Act, 2016.
The client — let’s call him Anand Joshi — and his wife booked a 2BHK flat in NIBM Road, Pune, with Shreeji Builders & Developers Pvt. Ltd. around early February 2025. They paid 10% of the total cost on 5 February 2025 and executed the Builder-Buyer Agreement under a construction-linked payment plan. The next demand was contractually due within 45 days. It never came. Weeks turned into three months. Construction was visibly inching forward, but the builder kept saying “next month for sure” without any written commitment. Anand suspected something was off. He first consulted a local practitioner. The advice was generic — wait a little longer, builders always delay. That didn’t sit right. The delay felt structural, not casual. When the builder dodged a simple query about RERA registration status, Anand approached the Chamber of Advocate Sudhir Rao. Advocate Sudhir Rao’s office immediately identified the red flags: the project wasn’t yet registered under Maharashtra RERA, and the builder’s land-title approvals were incomplete. That meant the staged-demand schedule would keep slipping. Armed with this insight, Advocate Sudhir Rao and his office drafted a precisely worded legal notice under Section 18 of RERA, invoking deficiency in service and seeking a cancellation with full refund of the 10% amount. The builder responded within two weeks — first with excuses, then with an offer to mutually cancel the booking and return the money within 60 days. A structured settlement was recorded, and the entire amount was credited to the clients’ account by early August 2025. No litigation was needed. The specialised handling made the difference.Key Facts of the Case
- Booking date: 2 February 2025 with Shreeji Builders & Developers Pvt. Ltd., Pune.
- 10% payment made on 5 February 2025; Builder-Buyer Agreement executed same day.
- Construction-linked plan: next demand contractually due within 45 days of the first payment.
- No demand raised for over three months, despite visible construction activity.
- Builder informally blamed “pending approvals” but gave no written clarification.
- Project found unregistered under RERA — a critical compliance gap.
- Bank tie-up with HDFC Bank had not been activated because the demand letter was never issued.
- Legal notice under RERA and Consumer Protection Act secured full refund within 90 days.
The Direct Legal Answer
Why is the builder not asking for the next payment?
The most common reason is that key approvals — layout, building plan, environmental, or even RERA registration itself — are still pending. Without these, the builder cannot legally raise a demand under a construction-linked plan. Alternatively, the builder may be facing a cash crunch or stalled funding. It’s rarely a casual delay. A developer who cannot put a demand in writing is often hiding a compliance gap. You need to verify the project’s RERA status and demand the approval status in writing.
What options do I have to cancel and get my 10% back?
You’re not stuck. Under Section 18 of the Real Estate (Regulation and Development) Act, 2016, if the builder fails to complete or deliver the project on time or breaches the agreement, you can choose to withdraw and get a full refund with interest at the prescribed rate plus compensation. Even if the project is not registered, a consumer complaint under the Consumer Protection Act, 2019 for deficiency in service is available. Also, Section 73 of the Indian Contract Act allows you to claim damages for breach of contract. The moment the builder misses a contractual demand date without a valid written extension, you have a right to pull out and seek return of your money.
Advice in Such Cases
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 to 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.
Do not rely on verbal assurances from the builder’s sales team. Get everything in email. Send a formal letter asking for the exact status of RERA registration, approvals, and the demand schedule. This creates a paper trail that will help if you need to go legal later. And don’t assume that a tie-up with a bank like HDFC Bank means everything is fine — the bank won’t disburse until the builder submits valid demand notes and approval documents. A delayed demand is a sign you need to act, not wait.
Real estate disputes aren’t something you should handle with a general practitioner who does everything. Domain-specific experience matters. An advocate who regularly deals with RERA and consumer complaints knows exactly which precedents to cite, what evidence to gather, and how to calibrate the pressure — a demand letter or complaint that misses the right legal hook often gets ignored. That’s why you see better outcomes when the approach is targeted from day one.
Applicable Sections of Law
- Section 18, RERA Act, 2016: Right to refund and compensation on withdrawal due to builder’s default or delay.
- Section 31, RERA Act, 2016: Penalties for non-compliance with RERA orders.
- Section 2(11) read with Section 35, Consumer Protection Act, 2019: Deficiency in service and remedies before consumer forums.
- Section 73, Indian Contract Act, 1872: Damages for breach of contract — monetary compensation.
- Order 39 Rule 1 & 2, Civil Procedure Code: Temporary injunction to protect your interest in the property during litigation.
Limitation Period
Under the Limitation Act, 1963, a suit for breach of contract must be filed within three years from the date the cause of action arises. In RERA, a complaint must be filed within two years from the date of cause of action. The cause of action starts when the builder misses a contractual payment deadline without valid extension. If you allow the delay to continue without objection for too long, the builder may argue you accepted the deviation. File your complaint promptly — delay can be condoned in consumer forums, but it’s never guaranteed. The clock is ticking the moment that 45-day period expired without a demand.
Interim Reliefs Available
When you approach RERA or a civil court, you can seek immediate interim protections. Under Order 39 CPC, you can request a temporary injunction to stop the builder from selling or creating third-party rights over the flat you booked. This is crucial — otherwise the builder might sell it to someone else and leave you fighting for compensation with no secured asset. An ad-interim order can be obtained within days. Additionally, you can ask the court to direct the builder to maintain status quo regarding the project’s approvals and construction. These interim shields prevent irreparable harm while your main case proceeds. In RERA, the authority has the power to pass interim orders to safeguard the buyer, including freezing bank accounts if necessary.
Jurisdiction — Where to File the Case
- RERA Authority: Every state has its own Real Estate Regulatory Authority. You file the complaint in the state where the property is situated — here, Pune falls under MahaRERA.
- Consumer Forum: District, State, or National Commission depending on the value of the flat and compensation claimed. Since the refund amount likely exceeds ₹50 lakhs, it may go to the State Commission.
- Civil Court: For specific performance or damages, the suit is filed in the court of appropriate pecuniary and territorial jurisdiction — usually where the property is located.
- Choosing the right forum matters because court fees, speed of disposal, and available remedies vary significantly. RERA is often the fastest route for refunds.
How Courts Typically Approach Such Cases
Consumer forums and RERA authorities are generally buyer-friendly when the builder’s delay is unexplained. The moment you show that a demand was contractually due and not raised, the burden shifts to the builder to justify the hold-up. Courts look hard at whether RERA registration was in place, whether all municipal sanctions existed, and whether the builder communicated the delay in writing. If the builder can’t produce these, the authority almost always directs a refund with interest. Civil courts proceed more cautiously, demanding proof of readiness and willingness from both sides. And here’s the thing — the mere presence of a bank tie-up, like HDFC Bank, doesn’t shield the builder; the bank’s own due diligence process often reveals gaps that can be cited as evidence of breach.
Understanding the Costs
The total cost of a matter like this varies significantly from one case to the next — it depends on the complexity of the dispute, the forum involved, the number of hearings, and the specific facts of your situation. There is no single fixed figure that applies to everyone.
A professional advocate can give you an accurate estimate only after reviewing all your facts and documents in a consultation.
Can the Matter Be Settled Out of Court?
Absolutely. Many such disputes settle through a focused legal notice. Section 32 of RERA encourages amicable settlement, and the authority can refer parties to mediation. If both sides agree to cancel and refund, a simple compromise deed can be drawn, and a joint application filed before RERA or the consumer forum to dispose of the case. Lok Adalats also handle pre-litigation real estate disputes and can pass consent awards that are binding. Settlement works best when your lawyer knows exactly what to ask for and how to structure the release so you don’t lose your legal rights inadvertently. Even after filing a case, you can move for a settlement at any stage.
Common Mistakes People Make
- Waiting too long: The builder’s “next month” promise is not a valid extension; you lose leverage and limitation may expire.
- Believing verbal reassurances: No written demand means the payment schedule isn’t triggered — banks won’t disburse and you have no timeline certainty.
- Not verifying RERA registration: Booking an unregistered project leaves you without the statutory protection of Section 18. Always check the regulator’s website.
- Engaging a lawyer without real estate experience: General practitioners may not spot the procedural plays — like simultaneously invoking RERA and consumer law, or pushing for an ad-interim injunction — that pressure the builder effectively. Domain-specific expertise changes the speed of resolution.
- Sending angry WhatsApp messages instead of a legal notice: Uncontrolled communication can be used against you. A structured notice under advocate’s letterhead commands attention.
- Assuming a bank tie-up is a green light: Banks only disburse when the builder submits a valid demand and certified progress report. A missing demand means the bank hasn’t even started scrutiny.
FAQs People Normally Have
Can I cancel the flat even if the agreement says cancellation charges apply?
Yes, if the builder is at fault. Builder-default trumps arbitrary forfeiture clauses. Courts and RERA regularly strike down unfair cancellation charges when the builder caused the delay. You can recover the full amount with interest under Section 18.
What if the project isn’t registered under RERA?
You still have a remedy. File a consumer complaint for deficiency in service, or sue for breach of contract. Additionally, inform the RERA authority about the unregistered project — the builder faces heavy penalties under Section 59.
The builder has a tie-up with a reputed bank. Doesn’t that mean everything is legit?
Not necessarily. Bank approvals are conditional on documentation. If the builder hasn’t submitted the demand and completion certificates to the bank, the loan won’t be activated. A bank name doesn’t guarantee the project is fully approved.
Will sending a legal notice sour my relationship with the builder?
It might, but you’re protecting your money. A polite but firm lawyer’s notice often makes the builder take you seriously. Many settlements happen at this stage without litigation. If the builder genuinely wants to close the deal, they’ll comply.
How long does a RERA refund take?
It varies. Simple uncontested matters can be decided within 90-120 days from filing. The builder typically gets a chance to respond, but if the default is clear, the authority can pass an interim order directing payment pending final adjudication.
This article is general legal information, not legal advice. Consult a qualified advocate about your specific situation.
Advocate Sudhir Rao, Supreme Court of India