The Maharashtra Real Estate Appellate Tribunal (MahaREAT) has directed a real estate promoter to pay monthly interest to homebuyers for delayed possession of a flat, holding that the entitlement to interest under Section 18 of the Real Estate (Regulation and Development) Act, 2016, cannot be deferred until the promoter obtains an Occupancy Certificate.
A Bench comprising Chairperson Justice S.S. Shinde and Member (Administrative) Shrikant M. Deshpande partly allowed an interim application against Super Construction Company, directing the promoter to pay interest on ₹1,87,07,570 paid towards the flat’s consideration, at the rate of SBI’s highest Marginal Cost of Lending Rate (MCLR) plus 2%, from December 15, 2018.
The homebuyers had booked the flat in 2014 and executed the Agreement for Sale on February 17, 2016, with possession due by December 15, 2018. Despite the passage of several years, the promoter had neither handed over possession nor obtained the Occupancy Certificate. The homebuyers submitted that they were facing financial hardship by simultaneously servicing housing loan EMIs and paying rent for alternative accommodation.
The Tribunal observed that Section 18 of RERA expressly provides for payment of interest for every month of delay until possession is handed over. Relying on the Supreme Court’s decision in Newtech Promoters and Developers Pvt. Ltd. v. State of Uttar Pradesh, 2021 SCC Online 1044, it held that the allottee’s entitlement to interest is an unconditional right and cannot be made contingent upon the promoter obtaining an Occupancy Certificate or other mitigating circumstances.
The Tribunal also held that the promoter was not entitled to the benefit of the COVID-19 moratorium period since the agreed possession date had expired on December 15, 2018, much before the pandemic.
Accordingly, the Tribunal directed the promoter to pay the accrued interest from December 15, 2018, until October 27, 2026, within 30 days, and to continue making monthly interest payments thereafter at SBI’s highest MCLR plus 2%. The application was partly allowed, with parties directed to bear their own costs.
