12. Remedies Available in Case of Delay in Possession
Introduction
Delay in possession has historically been one of the most critical pain points in the real estate sector. Buyers often faced indefinite delays with limited remedies under contractual agreements that heavily favored promoters. The Real Estate (Regulation and Development) Act, 2016 addresses this issue by providing clear, enforceable, and time-bound remedies to homebuyers.
RERA ensures that delay is not treated merely as a contractual breach but as a statutory default, triggering defined consequences.
Legal Framework
Section 18 of RERA provides that where a promoter fails to complete or is unable to give possession in accordance with the terms of the agreement:
- The allottee may withdraw and claim refund with interest and compensation
- Alternatively, the allottee may continue with the project and claim interest for the period of delay
This provision overrides contractual clauses that attempt to limit promoter liability.
Nature of Delay under RERA
Delay is assessed based on:
- Timeline specified in the agreement for sale
- Commitments disclosed at the time of registration
Even if delay arises due to external factors, the promoter may still be held liable unless covered under specific force majeure provisions.
Available Remedies
Withdrawal from the Project
Buyers may choose to exit the project and claim:
- Refund of entire amount paid
- Interest calculated from date of payment
- Compensation, where applicable
This remedy is typically exercised where delay is substantial or project viability is uncertain.
Continuation with Compensation
Alternatively, buyers may continue with the project and claim:
- Interest for the period of delay
This option is often preferred where the project is nearing completion.
Filing Complaint
Buyers may approach:
- RERA Authority
- Adjudicating Officer
for enforcement of rights.
Practical Considerations
The choice between withdrawal and continuation is influenced by:
- Stage of project completion
- Financial condition of promoter
- Market value of property
- Buyer’s liquidity requirements
Withdrawal may not always be practical if the promoter lacks liquidity, making enforcement of refund challenging.
Promoter Perspective
Promoters often face genuine challenges such as:
- Delay in approvals
- Supply chain disruptions
- Financial constraints
However, RERA adopts a strict liability approach, limiting the scope for excuses.
Litigation Trends
Delay-related disputes form a significant portion of RERA cases. Common issues include:
- Dispute over agreed possession date
- Interpretation of force majeure
- Calculation of interest
CABTA Insights
- Delay liability is one of the most financially impactful provisions under RERA
- Promoters must commit realistic timelines to avoid exposure
- Buyers should assess project viability before opting for withdrawal
- Interest liability can significantly affect project cash flows
- Early dispute resolution is critical to avoid escalation
