A Hyderabad homebuyer who paid ₹79 lakh for a villa but was left waiting for construction to be completed has received relief from the Telangana Real Estate Regulatory Authority (TGRERA). The Authority directed the builder to refund the entire ₹79 lakh, along with interest at 10.7% per annum, after finding that the project was not registered under RERA and that the builder had failed to demonstrate meaningful construction progress.
The order, passed on August 20, 2026, was decided ex parte after the builder and the real estate agent failed to appear before the Authority despite receiving notices.
In addition to ordering the refund, Telangana RERA imposed a ₹1.03 crore penalty on the builder for marketing and selling units in an unregistered project.
Homebuyer Paid ₹79 Lakh for a ₹2.14 Crore Villa
The case concerned a villa project located at Pasumamula Village, Abdullapurmet Mandal, Ranga Reddy, Telangana.
The homebuyer approached a real estate agent while looking for a villa. The agent introduced her to the builder and presented details of the proposed project.
According to the homebuyer, the builder represented that the villa could be completed and handed over within approximately six months of execution of the agreement, provided an advance payment was made.
Relying on these representations, she booked Villa No. 85, measuring approximately 3,600 sq. ft., for a total consideration of ₹2.14 crore.
She subsequently paid approximately ₹79 lakh to the builder through different modes of payment.
A Sale Agreement was executed on February 5, 2024.
The buyer expected the villa to be completed within the promised period. However, construction remained incomplete even by August 2026, more than two years after execution of the agreement.
Builder Failed to Appear Before Telangana RERA
The homebuyer approached Telangana RERA against both the builder and the real estate agent.
The agent was impleaded because he had introduced the buyer to the builder and was involved in the transaction as a real estate agent.
Despite receiving notices, neither the builder nor the agent appeared before the Authority to contest the allegations.
As a result, the proceedings were decided ex parte.
The Authority examined the material available on record, including the agreement and the payments made by the homebuyer.
Builder Failed to Show Construction Progress
One of the significant factors considered by Telangana RERA was the builder’s failure to provide evidence showing the actual status of construction.
The builder had already collected ₹79 lakh from the homebuyer, but did not place before the Authority any material demonstrating that construction was progressing satisfactorily.
There was no adequate progress report, documentary evidence or other material establishing that the villa was nearing completion.
The Authority therefore drew an adverse inference from the builder’s failure to participate in the proceedings and provide evidence regarding the project’s status.
This became particularly important because the agreement did not provide a specific possession date.
No Possession Date Does Not Mean Buyer Must Wait Indefinitely
The Sale Agreement executed on February 5, 2024, did not specify a definite date for handing over possession of the villa.
However, Telangana RERA held that the absence of a specific possession date could not mean that a homebuyer must wait indefinitely for the builder to complete the project.
The builder was required to demonstrate that the project was actually progressing and that it was fulfilling its contractual obligations.
The Authority noted that the builder had failed to provide material showing the stage of construction or establishing when the villa could realistically be completed.
The builder also could not justify retaining ₹79 lakh from the homebuyer without demonstrating corresponding progress in construction.
Telangana RERA Orders Full Refund With 10.7% Interest
After considering the circumstances, Telangana RERA directed the builder to refund the entire ₹79 lakh paid by the homebuyer.
The Authority also ordered the builder to pay interest at 10.7% per annum.
The interest was directed to be calculated from February 5, 2024, the date on which the Agreement of Sale was executed, until the actual date of refund.
The applicable rate comprised 8.7% SBI MCLR plus 2%.
Based on the calculation provided in the case material, if the refund were made on August 20, 2026, the interest period would be approximately 927 days, or about 2.54 years.
On ₹79 lakh at 10.7% per annum, the interest would work out to approximately ₹21.47 lakh, taking the total amount to around ₹1 crore, subject to the actual date of payment.
Builder Also Penalised ₹1.03 Crore for Unregistered Project
The refund was not the only relief granted to the homebuyer.
Telangana RERA also found that the builder had marketed and sold plots and villas in an unregistered project, contrary to the requirements of Section 3(1) of the Real Estate (Regulation and Development) Act, 2016.
The Authority consequently imposed a penalty of approximately ₹1.03 crore on the builder.
The penalty was separate from the amount that the builder was directed to refund to the homebuyer.
Marketing and Sale Before RERA Registration
The Authority examined the circumstances surrounding the marketing and sale of the project.
The Agreement of Sale stated that the builder owned a large parcel of agricultural land and had obtained permission from the Hyderabad Metropolitan Development Authority (HMDA) to convert it into residential villas for sale.
However, the agreement did not establish that the project had been registered under RERA before the sale transaction was undertaken.
According to Telangana RERA, the circumstances established that the Agreement of Sale had been executed and consideration collected before obtaining RERA registration.
The Authority therefore treated the conduct as a violation of the statutory requirement concerning registration of real estate projects.
Homebuyers Should Verify RERA Registration Before Paying Large Advances
The case highlights the importance of checking the RERA registration status of a project before making substantial payments.
A buyer should not rely solely on a builder’s presentation, brochure, online advertisement or assurances regarding construction and possession.
Before booking a villa, flat or plot, buyers should verify:
- RERA registration of the project
- The registered promoter details
- Approved project information
- Construction status
- Necessary statutory approvals
- Details contained in the Agreement for Sale
- The promised possession timeline
- Payment schedule and refund provisions
- Whether the property is actually being marketed in the same manner as disclosed in the RERA records
A large advance payment can expose a buyer to substantial financial risk if the project subsequently stalls or the developer becomes unresponsive.
Keep Documentary Evidence of Every Payment and Promise
The case also demonstrates the importance of maintaining documentary evidence.
Homebuyers should preserve:
- Payment receipts
- Bank statements
- Agreements and allotment letters
- Brochures and advertisements
- Emails and WhatsApp communications
- Details of representations made by sales agents
- Photographs or videos showing construction progress
- RERA registration records
- Copies of notices and correspondence with the builder
Such documents can become important evidence if a dispute subsequently reaches the RERA Authority.
What the Telangana RERA Order Means for Homebuyers
The case sends an important message to homebuyers dealing with stalled or unregistered projects.
A builder cannot simply collect substantial amounts from a buyer and leave the buyer without a clear indication of construction progress or possession.
Where the statutory requirements are violated and the builder fails to fulfil its obligations, a homebuyer may seek appropriate relief under the RERA Act.
In this case, Telangana RERA granted the homebuyer a full refund of ₹79 lakh with interest, while separately imposing a ₹1.03 crore penalty for the alleged violation relating to the unregistered project.
The order also illustrates the risks of entering into a property transaction before verifying the project’s regulatory status and the importance of taking timely legal action when construction does not progress as promised.
Key Takeaways for Homebuyers
Verify RERA registration: Always check whether the project is registered before making a substantial payment.
Do not rely only on advertisements: Marketing material and verbal assurances should be compared with the project’s official records and contractual documents.
Check construction progress: Visit the site and verify the actual stage of development.
Read the Agreement for Sale carefully: Pay particular attention to possession, payment, cancellation and refund provisions.
Maintain payment records: Keep documentary proof of every amount paid to the developer.
Act when construction stalls: Do not continue making instalment payments without understanding the project’s actual status and your contractual and statutory rights.
Seek appropriate legal advice: Where a project remains stalled, unregistered or the builder becomes unresponsive, professional advice can help determine the appropriate remedy under RERA.
