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Home Possession Delayed? See 8 Things You Should Do Right Away!

Ongoing delay in possession of the house is one of the worst nightmares of a buyer, but what if it actually comes true? As alarming as it sounds, it is quite a common scenario these days, given the working capital crunch which builders face. These delays can occur due to the following reasons:

  • Pending municipal approvals or dispute
  • Working capital crunch - The developer has gone out of funds (and property is not selling) and the bank is refusing to fund the project

Whatever the reason might be, this delay not only causes a direct loss of money to the buyer but also make him feel depressed and frustrated. This ongoing delay also makes it impossible to plan for the future and increases other costs. For example, if you are staying in a rented property, you need to pay the rent as well as the EMI for the loan taken to build the new house. It can cause a major strain on your finances and also put you through mental anxiety.

But you should remember that even at this point all is not lost. There are many things you can do if you are facing losses because of the delay. Let us help you with certain things you should do if faced with such a situation.

Ask for compensation

    You can ask for compensation. If the builder delays the completion of the construction beyond the stipulated time, you are entitled as a property buyer to seek a compensation from the builder. This is something you should do if the property has been delayed for a very long period of time. The Buyers can additionally ensure at the time of entering into the agreement with the builders that such clause governing compensation is properly captured in the agreement. 

    Remember, law is always there to help you

    You should know that you have the right to file a consumer complaint on the grounds of deficiency in service as it has been defined in the Consumer Protection Act, 1986 (CPA) against the builder. A written complaint has to be filed with appropriate ‘Consumer Dispute Redressal Forum or Commission’ under the CPA, taking into consideration territorial and pecuniary jurisdictions.  

    If the property was being bought for personal use, then a case can be filed as per the value of the property or the amount of damage suffered by you. Any dispute of value lower than 20 lakhs should be filed in the District Commission in your district while State Commission handles disputes of more than 20 lakhs. Any dispute of value over 1 crore should be directly filed before the National Commission in New Delhi.

    A home buyer can claim for his/her losses even if the possession has been delayed by a day. Such legal action against the builder can ensure that the buyer can seek some relief. 

    Check the provisions your state has regarding this. It might be more helpful than you‘d have anticipated it to be

    Some states have special provisions to benefit the consumers. For example, in Maharashtra you can remedy this through Section 8 of the Maharashtra Ownership Flat Act 1963, which makes the builder liable to refund the money obtained from a consumer with 9% of simple interest, if he is unable to justify non-completion or delay in possession of his project. 

    Get your share!

    If you as a buyer are assured that you will get the possession of the flat in the next few months or years, you can claim the money spent by you to pay for the rent of the alternative accommodation. This is applicable if the building is being redeveloped or you are buying a house for the first time. You can also claim the interest on the payment that has been made till date for the flat in case of delayed possession. 

    You can also claim indirect losses provided you have a strong proof for it

    If you want to claim indirect losses, you will have to prove what all you have suffered. For example, if you were promised to get the possession of the house before your marriage and because of the delay in possession your marriage has been called off, then you are liable to claim for the loss you have suffered. As long as the evidence is strong and sufficient enough to be proven, you can fight the case against the developer/ builder for delaying the possession of your flat in consumer court.

    Refund Rights!

    You can ask for a refund only if there has been a case of deficiency of services for a very long duration and such a clause was added initially in the legal documents or contract at the time of purchase. In this situation, you can directly go to the civil court and file your case for a refund against the builder or developer as the contract permits. Now, what should you do if you have forgotten to add this refund clause in your contract at the time of purchase/documentation? Do not panic! You can count on the Consumer Court and ask for suitable remedy.

    For your information!

    There are some additional provisions which you should be aware of. For example, the Domestic Building Contracts Act 1995 states that the builder has to give the following warranties-

    • That all the work would be completed on time 
    • That all work will be carried out in accordance with the plans and specifications set out in the contract 
    • That all material to be supplied by the builder will be of a high quality 
    • That the work will be done in a legal manner with reasonable care and skill, and 
    • When the work is completed, the home will be fit for occupation. 

    As per this law, you are entitled to take action for delays.

    Notify before acting

    Before taking any action, it is always advisable to send a legal notice to the opposite side giving them adequate time to respond. Once the notice is sent, the builder might speed up the process to take necessary actions, thereby saving you a lot of time and money.

    It is true that ongoing delay in possession can be frustrating and torturing at times, but you should not lose hope because now you know that there are many steps you can take if you are faced with such kind of a situation. It is always better to have thorough knowledge of these things, lest the builder might take you for a ride. So, be aware and buy smart!

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