6-Year Delay In Providing Possession, Karnataka RERA Orders Builder To Pay Interest, Hand Over Possession Of Flat To Homebuyer

Background Facts

On September 1, 2024, the Homebuyer (complainant) booked a flat in the builder's project named Pashmina Brookwoods by entering into a sale agreement and a construction agreement. The total cost of the flat was Rs. 26,58,079, out of which the homebuyer paid Rs. 23,86,785 to the builder.

As per the agreement, the builder was supposed to hand over possession of the flat on August 31, 2016, but more than six years have passed, and the builder has failed to complete the project and hand over possession on the promised date. Therefore, aggrieved by the six-year delay, the homebuyer filed a complaint before the authority seeking interest for the delayed possession.

Observation and Direction by Authority

The authority observed that despite entering into an agreement to deliver the flat to the homebuyer by August 2016 and receiving a substantial amount, the builder has failed to fulfill the agreement's terms by not handing over possession of the flat to the homebuyer. Therefore, Builder is liable to pay interest to homebuyer for delayed possession under Section 18 of RERA, 2016.

Authority referred to the Supreme Court decision in M/s Newtech Promoters and Developers Pvt. Ltd vs. State of Uttar Pradesh & Ors [LL 2021 SC 641], where it was held that if the builder fails to handover the possession of the apartment, plot, or building within the time stipulated under the terms of the agreement, then the homebuyer's right under the RERA, 2016 to seek a refund or claim interest for delay is unconditional and absolute, regardless of unforeseen events or stay orders of the Court/Tribunal.

Therefore, the authority directed the builder to pay Rs. 16,21,012/- to the homebuyer as interest for the delayed possession from August 31, 2016, to November 1, 2024. Additionally, the authority directed the builder to execute the sale deed and hand over possession of the flat to the homebuyer.

Case – Ivan Dsouza & anr Versus Shashwati Realty Pvt Ltd.

Citation - COMPLAINT NO: CMP/00774/2023