The issue of whether the Real Estate Regulatory Authority (RERA) completion date can override the possession date mentioned in the Agreement for Sale has been a subject of debate among homebuyers and developers. Many homebuyers assume that the possession date stated in their legally binding agreement remains sacrosanct, while developers often claim that the RERA completion date should be considered as the final deadline. This article explores the legal standing of possession dates under RERA, judicial interpretations, and the implications for homebuyers.
Understanding the Possession Date in an Agreement for Sale
An Agreement for Sale is a legally binding contract between a developer and a homebuyer. It typically specifies the following:
- The agreed-upon sale price and payment schedule
- The estimated date of possession of the unit
- Obligations of the developer regarding construction and delivery
- Remedies available to homebuyers in case of delays
As per the Real Estate (Regulation and Development) Act, 2016, developers are required to register their projects with the respective state RERA and provide a completion date for the project. However, this RERA completion date often extends beyond the possession date in the Agreement for Sale, leading to disputes.
RERA Completion Date vs. Possession Date
The RERA completion date is the deadline by which the developer commits to complete the project and obtain the Occupancy Certificate (OC) or Completion Certificate (CC). This date is mentioned in the RERA registration details and is available on the official website of the respective state RERA authority.
On the other hand, the possession date mentioned in the Agreement for Sale is a contractual obligation. If the developer fails to deliver possession by this date, the homebuyer has the right to seek remedies, including compensation, interest on delayed possession, or even a refund.
Can the RERA Completion Date Override the Possession Date?
Legally, the possession date in the Agreement for Sale holds greater weight than the RERA completion date. Here’s why:
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Contractual Obligations Prevail: The Agreement for Sale is a legally enforceable document under the Indian Contract Act, 1872. The developer cannot unilaterally alter the possession date unless both parties agree to the change.
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RERA Registration Does Not Amend the Agreement: The RERA registration process does not automatically modify the terms of a private contract between a homebuyer and a developer. If the developer registers a project with a later completion date than what was originally promised, it does not nullify the possession date in the Agreement for Sale.
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Judicial Precedents Favor Homebuyers: Courts and RERA appellate tribunals have ruled in favor of homebuyers in cases where developers tried to rely on the RERA completion date instead of the agreed possession date. The Maharashtra Real Estate Appellate Tribunal (MREAT), in multiple rulings, has emphasized that developers must adhere to the contractual possession date unless there are force majeure circumstances.
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Compensation for Delays: As per Section 18 of the RERA Act, if a developer fails to hand over possession as per the Agreement for Sale, the homebuyer is entitled to a refund along with interest. The interest is calculated from the due possession date in the agreement, not the RERA completion date.
Implications for Homebuyers
- Homebuyers Can Seek Compensation: If possession is delayed beyond the agreement date, homebuyers can approach RERA for compensation or even a refund.
- Developers Cannot Extend Possession Date Unilaterally: Any extension beyond the original possession date requires the explicit consent of homebuyers.
- Legal Action for Delayed Possession: If a developer cites the RERA completion date to justify delays, homebuyers can challenge this in RERA or consumer courts.
Conclusion
The possession date in the Agreement for Sale remains legally binding, and developers cannot rely on the RERA completion date to delay handover. Homebuyers should be aware of their rights and take legal action if developers attempt to override the contractual possession date.
