Short Answer

Under Section 18(1) of the Real Estate (Regulation and Development) Act (RERA), 2016, members (homebuyers) are entitled to claim compensation, interest, and refund from the builder for delayed possession of their flats.

Detailed Explanation

As per Section 18(1) of the RERA Act, 2016, if the builder (promoter) fails to hand over possession of the property within the agreed timeline, each buyer has the legal right to claim:

Refund of the amount paid along with interest, if the buyer chooses to withdraw from the project.

Interest for every month of delay, if the buyer chooses to continue with the project and take delayed possession.

Compensation for losses, if the delay has caused financial hardship, rental expenses, or mental agony.

The rate of interest payable for delay is the same as the rate charged by the State Bank of India for home loans plus 2% (as prescribed under Gujarat RERA Rules).

This ensures that buyers are fairly compensated for the builder’s failure to fulfill the contract.

Additionally, Section 19(4) of RERA states that the promoter is liable to compensate the buyer for any loss caused due to delay or non-compliance with the agreement for sale. Buyers can file their complaints online through the Gujarat RERA Authority (https://gujrera.gujarat.gov.in/

) without requiring a lawyer or a group complaint.

In practice:

The buyer files a complaint before Gujarat RERA through the prescribed online form.

RERA issues a notice to the builder and conducts a hearing.

If the delay is proven, RERA orders the builder to pay monthly interest for the delay period or refund the total amount with interest.

In certain cases, compensation for mental harassment or litigation expenses may also be awarded under Section 71.

Real-world Scenarios

Scenario 1: Mr. Mehta booked a flat in 2018 with possession promised by 2021. The builder failed to deliver even by 2023. Mr. Mehta files a complaint under Section 18 and receives interest on his paid amount for the delayed period.

Scenario 2: Mrs. Shah chooses to withdraw from the project after a 2-year delay. RERA directs the builder to refund the full amount she paid along with interest at SBI’s MCLR + 2%.

Scenario 3: A group of members files individual RERA complaints, and RERA orders the builder to compensate each one separately for delayed possession.

References

Section 18, 19, and 71 of the Real Estate (Regulation and Development) Act, 2016: Official RERA Act PDF

Gujarat RERA Rules and Website: https://gujrera.gujarat.gov.in/