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.
Mr.X approached me regarding his residential apartment purchase in City A. He had booked a flat in ABC Residency project developed by XYZ Builders Ltd in DD/MM/2021 with a promised possession date of DD/MM/2023. The agreement clearly mentioned penalty clauses for delayed possession, including compensation at a specified rate per month of delay. However, when the possession date passed, XYZ Builders cited construction delays due to regulatory approvals and refused to pay any compensation. They provided a revised timeline extending the possession by another 18 months. Mr.X had already paid 80% of the total amount and was paying EMIs on his home loan while living in rented accommodation. The builder’s refusal to acknowledge their liability for delay compensation prompted Mr.X to seek legal recourse through RERA.
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.
Review your sale agreement thoroughly to identify penalty clauses and compensation terms for delays. Gather all payment receipts, correspondence with the developer, and documentation of promised timelines. Calculate the compensation amount as per the agreed terms in your purchase agreement. File a complaint with the State RERA authority within the prescribed limitation period, typically three years from the due date of possession.
Applicable Sections of Law
Under the Real Estate (Regulation and Development) Act, 2016, Section 18 mandates that developers must complete projects within stipulated timelines and pay compensation for delays. Section 31 of RERA empowers the regulatory authority to adjudicate disputes and direct compensation. Additionally, under Bharatiya Nyaya Sanhita (BNS), Section 318 deals with cheating and dishonest inducement, which may apply if the developer made false promises. Section 61 of BNS covers criminal breach of trust if funds were diverted. The Bharatiya Nagarik Suraksha Sanhita (BNSS) Section 173 governs the investigation procedure if criminal elements are involved in the delay or fund misappropriation.
If You Are the Complainant
File a detailed complaint with State RERA including all relevant documents and evidence of delay. Calculate the exact compensation amount based on your agreement terms and current market rates. Maintain detailed records of all additional expenses incurred due to delayed possession, including rental costs and loan EMIs. Submit proof of payments made to the developer and timeline violations. Request interim relief for immediate financial support during the proceedings.
If You Are the Victim
Document all financial losses including rent payments, additional EMI burden, and opportunity costs. Join hands with other affected buyers in the same project for collective action. Preserve all communication with the developer including emails, notices, and verbal commitments. Calculate pre and post-litigation interest on the compensation amount. Seek immediate possession or refund with interest as alternative relief options.
How the Police Behave in Such Cases
Police typically treat real estate delays as civil disputes unless criminal elements like fund diversion or cheating are established. They may register FIR under BNS provisions if sufficient evidence of criminal intent exists. Generally, police refer such matters to RERA first before considering criminal proceedings. Investigation focuses on financial irregularities and fraudulent representations rather than mere contractual delays.
FAQs People Normally Have
Q: Can I get both RERA compensation and criminal proceedings?
A: Yes, civil remedy through RERA and criminal proceedings can run parallel if cheating or fraud is established.
Q: What if the developer offers partial possession?
A: You can accept partial possession but still claim compensation for the delayed portion and common areas.
Q: Is there a time limit for filing RERA complaints?
A: Yes, complaints must be filed within three years from the due date of possession or project completion.
Q: Can I claim interest on delayed refunds?
A: Yes, RERA mandates payment of interest at prescribed rates on delayed refunds or compensation amounts.
What Evidence Is Required?
- Original sale agreement with possession timeline clauses
- Payment receipts and bank statements showing amounts paid
- All correspondence with developer including delay notices
- Photographs showing project status and construction delays
- Rent receipts and EMI statements showing additional financial burden
- Developer’s revised timeline communications
- RERA registration details and project approvals
How Long Will the Investigation Take?
RERA proceedings typically take 6-12 months for disposal, depending on case complexity and evidence presentation. The authority aims to resolve complaints within 60 days of final hearing completion. However, if appeals are filed, the process may extend to 18-24 months. Interim relief can be granted within 30-60 days if urgency is established.
Advocate Sudhir Rao, Supreme Court of India