In a major boost for aggrieved homebuyers, the Maharashtra Real Estate Regulatory Authority (MahaRERA) has introduced a new Standard Operating Procedure (SOP) to ensure faster and time-bound recovery of compensation from defaulting developers. The regulator has now set a strict 60-day window for builders to pay ordered compensation, failing which they risk asset attachment and even imprisonment for up to three months.

“Hereafter, for the first time, the case of any developer failing to pay the compensation amount despite sufficient opportunities will be sent to the Principal Civil Court of the respective area for further action. Upon taking this action, the erring builder may face imprisonment for a term of up to 3 months. This provision is expected to immensely help in recovering compensation and providing timely relief to the home buyers,” the MahaRERA statement said, according to a report by The Hindustan Times.

According to the statement, left with no amicable resolution with the developer, homebuyers often approach MahaRERA seeking relief on multiple issues, ranging from failure to receive possession of the apartment by the deadline to sub-standard construction quality, lack of parking, and missing amenities. Such complaints are heard by MahaRERA’s designated Adjudicating Officers, who, in turn, on the merits of the case, order compensation.

As per the SOP, if the homebuyer is not compensated within 60 days, the individual will have to file an application for non-compliance for the recovery of the amount with interest or interest for delayed possession or compensation, as the case may be, according to the MahaRERA statement.

After getting the complaint, MahaRERA shall hear the non-compliance application within 4 weeks from receipt of the same. If it is established prima facie that the developer has failed to comply with the order, a reasonable time will be granted to adhere to the order. Upon the reasonable time period coming to an end, if the developer continues to err, they may be asked to submit an affidavit detailing all movable and immovable assets, bank accounts, and other investments.

To ensure that the compensation is duly recovered, a Recovery Warrant will be sent to the District Collector concerned to initiate the seizure or attachment of assets and bank accounts, the MahaRERA said.

According to the developer, if the developer fails to provide details of immovable and movable properties, bank accounts, and other investments, the case will be referred to the Principal Civil Court of that area for further action. According to the provisions of the Code of Civil Procedure,defaulting developers may be imprisoned for up to three months.