The Maharashtra Real Estate Regulatory Authority (Maha RERA) has ordered a real estate developer to refund Rs 1.16 crore to two homebuyers after finding that the promised flats were never constructed and the project's registration had expired without extension.
The authority noted that the buyer had paid substantial amounts toward two residential units, but the project remained unfinished over an extended period. Both the physical construction and the regulatory compliance aspects had stalled, leaving the buyers with no recourse except to approach the regulator.
RERA observed that the project registration with the authority had lapsed and was not renewed in time. Under the Real Estate (Regulation and Development) Act, 2016, builders are required to maintain active registration for every project they undertake. Once registration lapses, the builder loses the legal authority to market or sell units under that project. In this case, the failure to extend the registration compounded the issue, as it meant the project existed in a regulatory vacuum with no oversight.
The two buyers had initially invested their savings into the flats, expecting timely possession. When the construction did not progress and the builder failed to deliver, they filed complaints with Maha RERA seeking both refund and compensation. The authority found merit in their claims and directed the builder to return the full amount paid, along with applicable interest as per RERA provisions.
Interest on delayed refunds is a key remedy under the RERA framework. It is designed to deter builders from holding onto buyers' money indefinitely and to provide some financial relief to aggrieved purchasers. The rate of interest is determined by the State Bank of India's highest marginal cost of lending rate, plus an additional percentage, ensuring the buyer is not left empty-handed due to prolonged delays.
This order underscores Maha RERA's willingness to enforce strict accountability on developers who fail to deliver projects and whose registrations lapse. For homebuyers across Maharashtra, the ruling reinforces the protective role of the regulatory body and sends a clear message that investing in unregistered or stalled projects carries legal risk—not just financial uncertainty. Legal experts say such orders also highlight the importance of verifying a project's RERA registration status before making any payment, as unregistered projects offer far fewer protections to buyers.
