A Bengaluru homebuyer who paid Rs 1.48 crore for an apartment in Gopalapura, Binnipete, finally secured justice after the Karnataka Real Estate Regulatory Authority (KRERA) and the Karnataka Real Estate Appellate Tribunal (KREAT) ruled in his favour for delayed possession. Despite the builder’s attempts to justify the delay by citing a typographical error and multiple force-majeure claims, both authorities concluded that the homebuyer was entitled to interest compensation.
Background of the Dispute
The Agreement of Sale, signed on January 9, 2014, clearly stated that the project would be completed by June 1, 2017. However, construction was completed only on October 8, 2018, and the Occupancy Certificate (OC) was received on September 12, 2018. The sale deed was executed even later, on April 23, 2021.
The builder argued that the date in the agreement was a drafting mistake and claimed he corrected it through an addendum sent on May 18, 2015. According to this claimed addendum, the revised date was November 2017, making the delay only 10 months. The builder also filed multiple reasons such as demonetisation, rains, sand shortage, and change of contractors as force majeure events.
KRERA rejected these arguments, stating that none of the alleged circumstances qualified as force majeure and that the builder failed to prove the existence or service of the alleged addendum.
KRERA’s Final Order and Compensation Awarded
On November 29, 2024, KRERA directed the builder to pay interest at SBI MCLR + 2% on the amounts paid by the homebuyer, calculated from June 1, 2017 to the date of possession. The total interest worked out to Rs 29,05,091, which must be paid within 60 days.
The builder appealed the decision before KREAT, but on October 24, 2025, the appellate authority upheld KRERA’s findings and dismissed the appeal.
Why the Homebuyer Won the Case
Inordinate and Unexplained Delay
The builder admitted to the delay but attempted to justify it through generic problems often faced in construction. KRERA noted that such reasons did not meet the legal criteria for force majeure. No documentary evidence was provided to link the stated issues with the actual delay.
No Valid Amendment to the Agreement
KRERA observed that the Agreement to Sale (ATS) was never legally amended. A unilateral letter or alleged courier communication cannot modify a registered agreement. Since the builder failed to produce proof that the addendum was served or accepted, the June 1, 2017 deadline remained binding.
Payments by the Homebuyer Were on Time
The builder accused the homebuyer of delaying balance payment until March 11, 2019. However, KRERA held that the March 2019 payment was not part of the consideration but related to stamp duty and registration fees for the sale deed. Bank statements showed that all earlier payments were timely.
Builder Took Contradictory Positions
KRERA highlighted the inconsistency in the builder’s arguments. On one hand, he claimed the ATS was incorrect and needed correction. On the other hand, he relied on the same ATS to argue that the buyer delayed possession and owed interest. Authorities cited the Supreme Court’s ruling in Vishnu vs. State of Maharashtra (AIR 2006 SC 508), which held that a contract must be read as a whole and cannot be selectively interpreted for convenience.
Conclusion
The ruling reinforces that builders cannot escape contractual obligations by claiming unilateral amendments, vague operational difficulties, or unsubstantiated force majeure events. KRERA’s decision, upheld by KREAT, ensures that the homebuyer receives rightful compensation for the delay and sets a strong precedent for others facing similar issues in Karnataka’s real estate market.
