Yes, you can file a case against a builder for delayed possession if they fail to deliver the property within the promised timeframe. Delayed possession is one of the most common issues faced by homebuyers in India, and the law provides various remedies to safeguard the buyer’s interests. Below is a detailed explanation of your rights and legal options when dealing with delayed possession by a builder.
Steps to File a Case Against the Builder
1. Check the Builder-Buyer Agreement The first step is to examine the builder-buyer agreement or sale agreement you signed with the builder. The agreement usually specifies the possession date, grace period, compensation for delay, and other relevant terms. If the builder fails to adhere to these terms, you can initiate legal action. Ensure you have the original agreement and any addenda as proof.
2. Send a Legal Notice Before filing a case, send a legal notice to the builder highlighting the delay and requesting them to provide immediate possession or compensation as specified in the agreement. A well-drafted legal notice can sometimes compel the builder to resolve the matter without litigation. Mention the original possession date, agreed-upon terms, and your demand for resolution.
3. File a Complaint Under RERA (Real Estate Regulatory Authority) If the property is registered under the Real Estate (Regulation and Development) Act, 2016 (RERA), you can file a complaint with the state RERA authority. RERA ensures that builders deliver projects on time and penalizes delays. Submit a formal complaint with details of the project, builder’s name, and documents like the sale agreement and payment receipts. The RERA authority can order the builder to provide compensation, refund the amount with interest, or deliver the property promptly.
4. Approach the Consumer Forum If RERA is not applicable or if you seek additional compensation for mental agony, you can file a complaint with a consumer forum. As per the Consumer Protection Act, 2019, delayed possession constitutes a deficiency in service, allowing you to claim compensation. Based on the value of your claim, you can file a complaint with: District Commission (for claims up to ₹1 crore), State Commission (for claims between ₹1 crore and ₹10 crore), National Commission (for claims exceeding ₹10 crore). Submit documents like the agreement, receipts of payments made, the legal notice, and any communication with the builder as evidence.
5. File a Civil Suit If the compensation amount is significant or if you seek specific performance (forcing the builder to deliver possession), you can file a civil suit in a civil court. This legal route is generally used in complex cases but can take time due to procedural delays. Consult an experienced real estate lawyer to understand whether this option suits your case.
6. Lodge a Complaint With the Competition Commission of India (CCI) If the builder engages in unfair trade practices, such as misrepresentation, false advertisements, or holding a dominant position, you can file a complaint with the Competition Commission of India (CCI). Submit evidence of misleading claims or deceptive practices that show the builder’s fault.
7. Pursue Criminal Action In extreme cases where fraud, cheating, or breach of trust is evident, you can file a criminal case under sections like Section 318(4) (cheating) and Section 316 (criminal breach of trust) of the Bharatiya Nyaya Sanhita, 2023. This may involve police investigations and a court trial.
Compensation You Can Claim
- Interest on Paid Amount: Builders are often ordered to pay interest on the amount you have already paid for every month of delay.
- Refund With Interest: You can claim a full refund with interest if you no longer wish to wait for possession.
- Compensation for Mental Agony and Legal Costs: Additional compensation can be claimed for the mental stress caused by the delay.
- Penalty on the Builder: Authorities like RERA can impose penalties on the builder for non-compliance.
Relevant Legal Provisions
- Real Estate (Regulation and Development) Act, 2016: Governs delays and ensures protection for homebuyers.
- Consumer Protection Act, 2019: Helps in filing complaints for deficiency in service or unfair trade practices.
- Indian Penal Code (Sections 406 and 420): Applies to criminal fraud or breach of trust cases.
- Specific Relief Act, 1963: Allows buyers to demand specific performance if the builder fails to honor the contract.
Documents Required for Filing a Case
- Builder-buyer agreement and payment receipts.
- Correspondence with the builder, including emails and legal notices.
- Proof of project advertisements and possession timelines.
- Evidence of mental agony or financial losses (e.g., loan statements).
Precautions to Take Before Filing a Case
- Keep all your documentation intact and avoid verbal agreements.
- Act promptly and don’t delay filing your complaint as it may weaken your case.
- Engage a qualified lawyer with expertise in real estate cases.
- Assess the builder’s credibility and financial condition before choosing between compensation and possession.
FAQs
Q1. Can I file a case if I purchased the property through a resale? Yes, as the new buyer, you inherit all rights under the builder-buyer agreement, and you can take action against the builder.
Q2. Can I approach both RERA and Consumer Forum simultaneously? No, you can pursue a remedy under either RERA or Consumer Forum, but not both simultaneously for the same issue.
Q3. How long does it take to resolve such cases? RERA and Consumer Forums generally try to resolve cases within 90-120 days. However, the time can vary depending on the complexity of the case.
Q4. Can I claim compensation for rent paid due to delayed possession? Yes, you can claim compensation for rent paid or any other financial losses incurred due to the delay.
Q5. What happens if the builder declares bankruptcy? You can file your claim with the Insolvency Resolution Professional appointed under the Insolvency and Bankruptcy Code (IBC). Buyers are treated as financial creditors under the IBC.
Filing a case against a builder for delayed possession requires a clear understanding of your rights and the legal procedures involved. Consulting a real estate lawyer ensures you choose the most effective legal remedy based on your specific situation.
Disclaimer: This information is intended for general guidance only and does not constitute legal advice. Please consult with a qualified lawyer for personalized advice specific to your situation.
Adcocate J.S. Rohilla (Civil & Criminal Lawyer in Indore)
Contact: 88271 22304