A homebuyer can still seek interest for the period during which the developer delayed handing over the property, the Allahabad High Court has held. The ruling is relevant for buyers who accept possession after waiting for years but later want to pursue their claim for compensation for the delay.

The Lucknow bench of the court also held that the Real Estate (Regulation and Development) Act, 2016 (RERA) does not prescribe a specific limitation period for claiming interest for delayed possession. The court dismissed an appeal by Antriksh Developers and Promoters in a dispute involving its Antriksh Golf View project in Sector 78, Noida.

The case involved homebuyer Shyam Sunder Agrawal, who booked a flat in 2010. Possession was contractually due by November 2012, but the developer offered it only in May 2017. According to the court, the offer was made without the occupancy certificate and other necessary documents.

The RERA Appellate Tribunal had directed the developer to pay interest on the amount deposited by Agrawal for the period from December 2012 to May 2017 at 1 per cent above the Marginal Cost of Fund Based Lending Rate.

What the ruling means for homebuyers

Accepting possession does not automatically amount to giving up a claim for delayed-possession interest.

“The Allahabad High Court’s judgment reinforces an important protection for homebuyers,” said Tusi Kumar, partner, law firm Singhania & Co. “Accepting possession after a delay does not, by itself, waive the right to claim interest.”

Kumar said Section 18(1) of RERA allows an allottee who chooses to remain in the project to claim interest for every month of delayed possession. However, he cautioned that the outcome of an individual claim will depend on the documents, relevant dates and any settlement reached between the buyer and developer.

Rishabh Gandhi, a former judge and founder of Rishabh Gandhi and Advocates, said buyers often accept possession after waiting for years and that this should not automatically be treated as a waiver of their statutory remedies.

“What matters is whether possession was delivered within the agreed timeline and, if not, whether the delay was legally justified,” he said.

This means buyers should preserve the allotment letter or agreement, payment records, promised possession date, correspondence with the developer and possession-related documents.

Developer must establish the reason for delay

The case also deals with an important issue for buyers: When can a developer rely on external events to explain delayed possession?

Antriksh Developers argued that the delay was linked to an order of the National Green Tribunal (NGT) restricting construction and the grant of occupancy certificates within a 10-km radius of the Okhla Bird Sanctuary.