My right to compensation for delayed possession despite securing possession?

Introduction

The problem of delayed possession in the real estate sector is a rampant issue. Most of the agreement to sale contracts are one-sided against the homebuyers and allow the builders to delay the construction and possession of flats which causes unnecessary hardship and frustration to the homebuyers, creating a serious problem in the real estate market. The Real Estate (Regulation and Development) Act, 2016 came into force to regulate the real estate market and confers certain rights and remedies to the homebuyers in cases of delayed possession of property.

Section 18 of The Real Estate (Regulation and Development) Act, 2016

Delayed possession can be defined as the delay caused by the builder to deliver the property at an agreed upon time. Inordinate delays caused by the builders, apart from monetary losses, cause mental harassment to the homebuyers. However, the homebuyer has certain remedies under the law which provide relief to the homebuyers.

The main remedy conferred to homebuyers under the Real Estate (Regulation and Development) Act (RERA) is Section 18 of the Act. Section 18 allows homebuyers to either withdraw from the project and claim refund of the amount paid for the property along with certain interest, or if the homebuyer does not withdraw from the project, the builder would be liable to provide compensation through interest for every month of delay.

The Real Estate (Regulation and Development) Act, 2016 also provides for quick dispersal of justice under Section 71 of the Act which allows for the matter to be heard before an adjudicating officer and decided within sixty days. This provision allows aggrieved homebuyers to receive quick remedy and monetary compensation in matters of delayed possession.

However, it is important to note that the relief offered to homebuyers under Section 18 of the Act is dependent upon the fulfilment of certain duties and obligations that are conferred on the homebuyers. These duties and obligations are given under Section 19 of the Act.

Compensation for Delayed Possession after Possession by the Homebuyer

While Section 18 of the Real Estate (Regulation and Development) Act, 2016 and various judgements with respect to delayed possession clarify that homebuyers can seek compensation for delayed possession until possession, it remains unclear as to whether a homebuyer is entitled to compensation for delayed possession even after the homebuyer has taken possession of the property.

The Maharashtra Real Estate Regulatory Authority has set a precedence and has provided a strict interpretation of Section 18 of the RERA Act. It has clarified that seeking relief under Section 18 of the Act can only be done so before possession of the property and while the violation of delay of possession is currently occurring. It held claims for relief sought under Section 18 after possession of property by the homebuyer to be inadmissible and held that Section 18 allows compensation only until the possession of the property.

However, this ruling of the Maharashtra Real Estate Regulatory Authority goes directly against the precedence established by the Maharashtra Real Estate Appellate Tribunal which in the case of Neera Gupta & Ors. v. Larsen and Toubro Ltd. allowed the appellants to claim compensation for delay of possession even after the appellants had possession of the property. The Maharashtra Real Estate Appellate Tribunal provided a more liberal interpretation of Section 18 and held that when the possession of the property is given after the stipulated date as mentioned in the agreement to sale, the homebuyers can still claim compensation for delayed possession.

Conclusion

The RERA Act allows for homebuyers to seek compensation for delayed possession of property before possession. However, whether homebuyers can seek compensation for delayed possession after possession of the property has still not been properly clarified with contradictory rulings of the concerned authorities.