MahaREAT Orders Builder To Pay Interest To Homebuyer For Delay In Providing Possession

Background Facts

The homebuyer (Appellant) purchased a flat in the builder's (Respondent) project 'Odina' in Chembur, Mumbai, for a total cost of ₹1,06,00,000. The Agreement for Sale was signed on 15th November 2017. According to Clause 9 of the agreement, the builder was required to hand over possession of the flat by 31st March 2019.

Due to the failure of the builder to deliver possession within the agreed timeline, the Homebuyers filed a complaint before MahaRERA. MahaRERA, in its order dated 21st December 2020, directed the builder to pay interest to the homebuyer from 1st January 2020 until the date the part Occupancy Certificate is obtained.

Aggrieved by the MahaRERA order, the homebuyer filed appeal seeking a directive for the builder to hand over possession of the flat and to pay interest at the prescribed rate on the paid amounts from 1st April 2019 until the actual possession date.

Tribunal Verdict

The Tribunal observed that the agreed timeline for possession, as per the agreement, was 31st March 2019. Despite this, the project only obtained the part-occupancy certificate from the Planning Authority on 12th June 2020 for the building up to the 15th floor, including the subject flat.

Furthermore, the Tribunal noted that the water supply connection, a prerequisite for occupancy, was only established by the BMC on 8th April 2021, meaning possession of the subject flat could not be given before this date. Subsequently, the possession of the subject flat was handed over to the complainant on 3rd August 2022. Therefore, the promoter failed to adhere to the agreed timeline for possession, invoking Section 18 of RERA, 2016.

The Tribunal referred to Section 18 and observed that it specifies that if the builder fails to deliver possession as per the agreed timeline, the homebuyer is entitled to interest at the prescribed rate on the paid amounts for the period of delay. Accordingly, the tribunal held that the homebuyer is entitled to interest from 1st April 2019 to 8th April 2021.

Case – Adv. Mr. Prashant M. Sane Versus M/s. vital Developers Private Ltd and another

Citation - APPEAL NO. AT006000000053027 of 2021

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