Timely Possession: A Promoter’s Prime Responsibility Under RERA (By CA Lalit Pawar)
One of the most critical rights of a homebuyer is the right to receive possession of their property on time. The Real Estate (Regulation and Development) Act, 2016 (RERA), places a significant emphasis on ensuring that promoters (developers) fulfill this responsibility. Delays in possession not only cause immense hardship and financial burden for homebuyers but also erode trust in the real estate sector. As a Chartered Accountant and RERA consultant, I, CA Lalit Pawar, have seen firsthand the challenges faced by homebuyers due to delayed possession and the relief that RERA provides in such situations. Let’s examine why timely possession is so crucial and what RERA mandates in this regard.
⏳ The Importance of Timely Possession:
Timely possession is paramount for several reasons:
- Fulfilling the Homebuyer’s Dream: Owning a home is a significant life goal for most people.
- Financial Planning and Stability: Delays disrupt financial plans and can lead to increased costs.
- Avoiding Double Burden: Homebuyers often have to pay both rent and EMIs during project delays.
- Trust and Credibility: Timely possession builds trust in the promoter and the real estate sector.
RERA’s Provisions for Timely Possession:
RERA includes several provisions to ensure that promoters adhere to the promised timelines:
- Defined Completion Date: Promoters are required to declare a definite completion date for the project at the time of registration with the RERA.
- Escrow Account: 70% of the funds collected from buyers must be deposited in a separate escrow account to ensure that the funds are used solely for the project’s construction and development. This prevents diversion of funds, which is a common cause of project delays.
- Penalties for Delays: RERA imposes penalties on promoters for delays in possession. These penalties can include financial fines and compensation to homebuyers.
- Homebuyer’s Right to Withdraw: If the promoter fails to provide possession within the agreed-upon timeline, the homebuyer has the right to withdraw from the project and claim a full refund with interest.
- RERA Authority’s Intervention: The RERA authority has the power to direct the promoter to complete the project and hand over possession to the homebuyers.
Remedies Available to Homebuyers in Case of Delay:
If a promoter fails to provide possession on time, homebuyers have several remedies available under RERA:
- File a Complaint with the RERA Authority: Homebuyers can file a complaint with the RERA authority seeking a direction to the promoter to complete the project and hand over possession, along with compensation for the delay.
- Withdraw from the Project: Homebuyers can choose to withdraw from the project and claim a full refund of the amount paid, along with interest.
- Approach the Appellate Tribunal: If dissatisfied with the order of the RERA authority, homebuyers can appeal to the Appellate Tribunal.
The Role of MahaRERA in Ensuring Timely Possession:
MahaRERA (Maharashtra Real Estate Regulatory Authority) has been proactive in addressing the issue of delayed possession. MahaRERA has issued several orders directing promoters to complete projects and compensate homebuyers for delays. MahaRERA has also taken action against promoters who have failed to comply with RERA regulations.
Conclusion: Upholding Homebuyers’ Rights
Timely possession is a fundamental right of homebuyers, and RERA has empowered them to assert this right effectively. Promoters who prioritize timely possession not only fulfill their legal obligations but also build trust and credibility, which are essential for long-term success in the real estate sector.
For More information, please refer original order @ MahaRERA Website:
Blog by CA Lalit Pawar
Promoter should give possession on time to home buyers
Disclaimer: This blog provides general information about the importance of timely possession under RERA. For specific legal advice and guidance related to your situation, please consult with a RERA expert or refer to the official MAHARERA website (maharera.maharashtra.gov.in).
Note: As per ICAI guidelines, please remember that this content is for informational purposes only and does not constitute professional advice. Consult a qualified professional for specific guidance related to your situation.