Status as on- 24/10/2021
Delay in possession of flats is traumatizing for the homebuyers who have invested a large sum of their life savings. In past, there is increase in delayed projects causing the homebuyers lot of problems, financially and mentally.
There is a point when the homebuyers loose the hope of getting the possession of the flat and only think if they will get the money back or not. RERA gives the relief to such homebuyers by providing quick redressal complaints against the builder and allows homebuyers to claim refund along with interest from the builder.
When the project is to be stalled?
Since the real estate projects are the turkey projects and take multiple years to get it completed, a normal delay can be accepted. However if there is extra-ordinary delay, then it is issue of big concern. Any delay of more than 1 year from promised date of possession is regarded as ‘extra-ordinary delay’.
There may be various reasons behind this stalled or stuck project, some of them are as under
- Mismanagement of funds
- Litigation in land or between promoters
- Fraud or diversion of money from one project to another
Relief under RERA Act
Under Section 18 of the RERA Act the builder needs to refund the money of the buyers and pay interest amount for the period of delay.
Section 18 of the RERA Act states that if the promoter fails to complete the project or is unable to give the possession –
- in accordance with the terms of the agreement for sale or, as the case may be, duly completed by the date specified therein; or
- due to discontinuance of his business as a developer on account of suspension or revocation of the registration under this Act or for any other reason, he shall be liable on demand to the allottees, in case the allottees wish to withdraw from the project, without prejudice to any other remedy available, to return the amount received by him in respect of that apartment, plot, building, as the case may be, with interest at such rate as may be prescribed in this behalf including compensation in the manner as provided under this Act:
Provided that where an allottee does not intend to withdraw from the project, he shall be paid, by the promoter, interest for every month of delay, till the handing over of the possession, at such rate as may be prescribed.
When the buyers have been waiting since years for the project to get completed and there is no hope that the project will be completed. In such case the homebuyer most feasible way is to proceed to cancel the booking and seek refund from the builder.
Situations where refund is refused
When the homebuyers claim for refund and interest, there are certain situations where RERA refuse to grant refund to homebuyers. The situation may be as follow-
- When the project can be completed after reviving it.
- When multiple refunds can hinder the builder’s financial ability to complete the project.
- When the project is almost completed i.e. at more than 90% of completion.
- When the builder is promising to complete the project and deliver the possession within 12 months.
Filing of complaint under RERA Act
Section 31 of RERA Act, talks about filing of complaint with the authority or the adjudicating officer. Under this section any aggrieved person can file a complaint against the developer and claim for refund and interest.
Homebuyers are forced to pay interest in the range of 18 per cent per annum for delay in payment of instalments while the builders themselves pay a penalty of 1.5-2% for delay in project amounts to unfair trade practice by real estate companies. It is unfair on the part of the homebuyers. The homebuyers invest their money and also pay a massive rate of interest where in fact the delay is on part of the developers. RERA Act grants the remedy to the homebuyers where they can file a complaint under section 31 of RERA Act and can claim interest for delay in possession by the developers. Homebuyers must seek legal assistance without delaying.
Are you stuck in a stalled project? Centrik can help you with your complaint filing, representation before the appropriate forum and execution of the order in case of delayed possession by the builder. You can take the expert opinion by sending us email at firstname.lastname@example.org or calling us at +91 8448487142.
Disclaimer- The above article is based on the personal interpretation of the related orders and laws. The readers are expected to take expert opinion before relying upon the article. For more information, please contact us at email@example.com