RERA Act 2016, Section 18 — In Plain Language
If a promoter fails to complete or hand over possession by the date stated in the agreement, the buyer can withdraw from the project and receive a full refund with interest, or continue with the project and receive interest for every month of delay until possession is actually handed over.
Option A: Withdraw
Option B: Continue
What happens
Full refund of amount paid
Keep the unit, project continues
What you receive
Refund + interest for the delay period
Monthly interest until possession
Best when
You've lost confidence in the project completing
Project is progressing, just behind schedule
Interest stops when
Refund is fully paid
Possession is actually handed over
Why the Reciprocity Matters
Before RERA, builder-buyer agreements often charged buyers a steep penalty for late payment while offering little or no compensation for the builder's own delay. RERA's equal-interest principle was designed specifically to remove that one-sided imbalance from standard agreements.
Advising Buyers on This — What Agents Should Flag Early
Check the agreement's possession-date clause at the time of booking itself — some agreements build in generous "grace periods" or force-majeure language that pushes the effective delay start date later than buyers expect. Flagging this before signing protects both the buyer and your own credibility later.
Frequently Asked Questions
What are my options if my RERA project possession is delayed?
Under Section 18 of the RERA Act, you can either withdraw from the project and claim a full refund with interest, or continue with the project and receive monthly interest for every month of delay until possession is handed over.
How is the interest rate for delayed possession calculated?
Most states have notified the interest rate as the State Bank of India highest Marginal Cost of Lending Rate (MCLR) plus 2%, applied for both promoter delay and buyer default, though the exact rate and notification can vary by state.
Does the promoter have to pay interest even if I do not withdraw from the project?
Yes. Under Section 18, a buyer who chooses to continue with the project rather than withdraw is still entitled to interest for every month of delay until possession is actually handed over.
Is there a time limit to claim compensation for possession delay?
RERA does not prescribe a strict limitation period the way the general Limitation Act does for civil suits, but buyers are advised to raise the claim promptly after the delay occurs, since unreasonable delay in filing can weaken a case and complicate calculation of the interest period.
Does a force majeure clause excuse the developer from paying delay compensation?
It can, but only for genuine, well-documented force majeure events recognised under the agreement or by the RERA Authority — a generic "unforeseen circumstances" claim without evidence is unlikely to succeed. Buyers should ask the promoter to specifically justify any force majeure claim before accepting it as a reason for non-payment.
Can I claim compensation for possession delay in addition to interest?
Section 18 primarily provides for refund-with-interest or ongoing monthly interest as the defined remedy. Additional compensation for other losses may be pursued, but is assessed by the Authority on the specific facts of the case rather than being an automatic add-on.
Change Log
Sep 21, 2026 — Converted FAQ and HowTo to single-source array pattern, expanded FAQ from 4 to 6 questions.
Sep 20, 2026 — Initial guide published.