Real Estate Project stalled in Gurgaon? This is how RERA Gurugram can help you
Introduction
The Indian Real Estate market is constantly growing, and Gurugram is emerging as one of the top realty markets in India. People are increasingly interested in investing in Gurgaon, attracted by higher returns in both property value appreciation and rental yields. Areas such as Dwarka Expressway, Southern Peripheral Road (SPR), Sohna Road, and Golf Course Extension Road have demonstrated strong growth, establishing themselves as sought-after real estate destinations. These prime locations continue to draw homebuyers, highlighting Gurugram’s resilient residential market and the surging demand for premium and luxury properties. Additionally, areas like Gwal Pahari have experienced a remarkable 200% appreciation over the past decade, while NRI investments in this area have also grown by 25%, particularly in the luxury segment.
However, the picture is not as lucrative as it seems. There are many Projects that have been completely stalled, while others have been delayed by the Promoters. In some cases, construction has commenced without obtaining essential licenses from the competent authorities. For example, several projects on Dwarka Expressway, particularly in Sector 95B, fall under the eco-sensitive zone of Sultanpur National Park. Here, builders have failed to secure the required Wildlife NOC from the relevant authorities, resulting in halted construction or the risk of future demolition. Additionally, many builders exploit homebuyers by forcing them to sign arbitrary and one-sided agreements instead of adhering to the model Agreement for Sale prescribed under the Haryana Real Estate (Regulation and Development) Rules, 2017, (“RERA Rules 2017”). In several cases, the property delivered to the homebuyers is significantly different from what was initially advertised or promised. Furthermore, even after possession, some buyers face issues due to poor construction quality.
In all these above scenarios, homebuyers have the option to approach the Haryana Real Estate Regulatory Authority, Gurugram (RERA Authority Gurugram) for redressal these issues. In the writer’s opinion, RERA Authority Gurugram is one of the most effective RERA Authorities in India and is highly efficient, when it comes to execution of the orders. It is likely the only authority in the country that fully utilizes the powers granted to it under the Real Estate (Regulation and Development) Act, 2016 (RERA Act). The RERA Act provides several rights to homebuyers to protect them from the corrupt practices of the Promoters/Builders while also granting extensive powers to the RERA Authority for adjudicating disputes arising out of the above-mentioned issues.
Adjudicatory Authorities in Haryana RERA Gurugram?
The RERA Act provides for two different adjudicatory authorities to resolve builder-buyer disputes. One is the RERA Authority itself, and the other is the Adjudicating Officer, who is usually a retired district court judge appointed by the RERA Authority in consultation with the State Government.
While the RERA Authority handles major issues arising from the breach of the Act, rules, and the Agreement for Sale, the Adjudicating Officer is the sole authority responsible for deciding matters related to compensation. Simply put, when it comes to refunds, interest, possession-related directions, or any other relief, the RERA Authority has the power to examine and determine these issues. However, when the relief sought involves compensation, only the Adjudicating Officer has the authority to decide.
While filing a complaint before the RERA Authority in RERA Gurugram, the complainant must submit the complaint using Form CRA. Similarly, when filing a complaint before the Adjudicating Officer, Form CAO must be used. It is also important to note that execution proceedings arising from any case filed before the RERA Authority are also conducted before the Adjudicating Officer. This is a special duty specifically assigned to the Adjudicating Officer in Gurugram.
Complaints before the Haryana RERA Authority, Gurgaon?
As mentioned above, the Haryana RERA Authority serves as the primary body for adjudicating almost all types of disputes arising from the breach of the provisions of the RERA Act, RERA Rules, or the Agreement for Sale executed between builders and buyers. Homebuyers typically approach RERA Authority Gurugram when there is a delay in possession by the builder or when a project is stalled. However, cases can also be filed based on other causes of action. Furthermore, while adjudicating disputes, RERA Authority Gurugram has broadened the scope of the Act for the welfare of homebuyers. As a result, the Authority has started ordering payments for assured returns promised to homebuyers as a form of relief.
Homebuyers can file cases against builders on various grounds and may seek the following remedies:
Refund along with interest:
A homebuyer can seek a full refund of their entire investment from the builder under either Section 12 or Section 18 of the RERA Act, 2016.
Section 12 applies when a homebuyer has made an advance payment or deposit based on information provided in a notice, advertisement, prospectus, or a model apartment, plot, or building shown by the promoter and later suffers a loss due to false or misleading statements. In such cases, the homebuyer has the right to withdraw from the project and can approach the Haryana RERA Authority, Gurugram, to claim a full refund along with applicable interest by filing a complaint using Form CRA. The interest awarded by RERA Authority Gurugram is set at the SBI Marginal Cost of Lending Rate (MCLR) + 2%.
Section 18 of the RERA Act mandates that if a builder fails to deliver possession of an apartment within the agreed timeline, they must refund the entire amount paid by the homebuyer along with applicable interest. The homebuyer has an absolute and unqualified right to seek this refund. In Imperia Structures Ltd. Vs. Anil Patni and Another, the Supreme Court held that Section 18 grants an allottee the unequivocal right to a refund along with interest at the prescribed rate if the promoter fails to complete the project or deliver possession as per the agreement. This right is independent of any conditions or stipulations. The Hon’ble Supreme Court reaffirmed this position in Newtech Promoters and Developers Pvt. Ltd. Vs. State of U.P., stating that under Section 18(1), an allottee has an indefeasible right to demand a refund if the promoter fails to deliver possession or complete the project on time.
Read in detail: Homebuyer’s Right to seek Refund under the RERA Act.
Possession with delayed Penalty:
The Act also provides homebuyers with the option to retain their investment in the real estate project and take possession of the unit. In such cases, the homebuyer is entitled to charge interest from the builder for every month of delay, starting from the promised date of possession until the valid and legal handover of the unit. In this case, the interest is also capped at the SBI Marginal Cost of Lending Rate (MCLR) + 2% by RERA Gurugram.
This interest for delayed possession cannot be denied, even in the absence of a registered Agreement to Sell. In Jervis Anthony Craeado vs. Aishwarya Light Construction Company, the Hon’ble Maharashtra Real Estate Appellate Tribunal held that the absence of a registered agreement between a developer and a homebuyer does not disqualify the homebuyer from claiming interest relief for delay under Section 18 of the RERA Act. In the absence of a formal agreement, other documents such as an allotment letter, brochure, template, or email communication mentioning the possession date can be considered to determine the delay.
Assured Returns:
Earlier, Promoters used to lure Buyers by offering assured returns in exchange for homebuyers paying a significant portion of the total consideration upfront—ranging from 60% to as much as 90%. These assured returns typically took the form of either the builder promising to pay the Pre-EMIs (EMIs due before possession) to banks or financial institutions on behalf of the homebuyer or committing to pay assured rental returns after the possession date. However, many builders stopped paying these assured returns midway after collecting substantial advances from buyers, leaving homebuyers with little to no legal remedy.
RERA Gurugram took a significant step toward protecting homebuyers’ interests by recognizing that assured return promises made by builders form part of the contract, i.e., the Agreement for Sale. Under Section 11 of the RERA Act, Builders are obligated to comply with the terms of the Agreement for Sale. Moreover, RERA has full authority to adjudicate such disputes and can issue directions to builders to fulfill their commitments. This means homebuyers could now claim assured returns from the builder as per the terms of the builder-buyer agreement (Agreement for Sale). This principle was extensively discussed in Madhushree Khaitan vs. Vatika Limited, where Haryana RERA Gurugram delivered a landmark judgment affirming homebuyers’ rights to receive assured returns as promised by the builder at the time of agreement execution. However, it is important to note that a homebuyer cannot claim both delay penalty interest (MCLR + 2%) and assured returns as mentioned in the Builder-Buyer Agreement simultaneously. They can only claim one of the two.
Complaints before the Adjudicating Officer, Gurgaon?
The term compensation is explicitly mentioned in Sections 12, 14, 18, and 19 of the RERA Act. When it comes to the question of seeking the relief of adjudging compensation the adjudicating officer exclusively has the power to determine, the same under Section 71 read with Section 72 of the RERA Act. The homebuyer can approach the RERA Gurugram to seek compensation under sections 12, 14 (3), 18 and 19 of the RERA Act and can file a complaint before the Adjudicating Officer by filing a complaint in the manner prescribed in the CAO form.
Under Sections 12 and 18, as discussed earlier, homebuyers can seek additional compensation over and above the delay interest. Further, different provisions of Section 18 entitle homebuyers to claim compensation if they suffer losses due to a defective land title, the promoter’s failure to fulfill obligations under the Act, or non-compliance with the Agreement to Sell. Under Section 14, the promoter is obligated to rectify any defects reported within five years from the date of possession. This provision ensures accountability by requiring the promoter to address defects within one month of being informed, without imposing any cost on the homebuyer. While the Act does not explicitly define structural defects, Haryana RERA has provided a definition in its respective regulations. Section 19(4) further strengthens the homebuyer’s rights by allowing them to claim a refund, along with interest and compensation, if the promoter fails to hand over possession as per the agreement.
The issue of compensation remains a grey area, as many claims are denied simply because the homebuyer has already received delay penalty or interest from the Authority. However, in several cases, the interest granted is even lower than what the homebuyer is paying to banks as home loan interest. For instance, if a flat was booked in 2017 with possession promised in 2021, but the project stalled and the buyer finally received a refund in 2024 with 11% interest, this amount may seem lucrative but fails to truly compensate for the time value of money. Beyond financial losses, the homebuyer incurs additional costs, such as rental expenses while awaiting a flat that was never delivered. The burden of legal fees to recover the invested amount further adds to the financial strain, which should also be recoverable as compensation. Additionally, the emotional distress, mental stress, and trauma suffered by the homebuyer are unquantifiable but significant.
Therefore, in the author’s view, RERA Gurugram needs to adopt a more open, holistic, and liberal approach when deciding compensation claims, as it has exercised this power cautiously, much like other RERA authorities across India. The statute is clear that compensation under the Act is meant to be in addition to the delay penalty or interest granted by the Authority. This position was further reinforced by the Hon’ble Supreme Court in Newtech Promoters Vs. State of UP, where the Court unequivocally upheld the homebuyer’s right to seek compensation beyond mere delay interest.
Conclusion
The real estate market in Gurugram presents lucrative opportunities but also significant challenges, with numerous stalled projects, delayed possessions, and non-compliance by builders. Many homebuyers find themselves trapped in unfair agreements, dealing with poor construction quality, or facing financial losses due to unfulfilled promises. In this scenario, the Haryana Real Estate Regulatory Authority (RERA) Gurugram has established itself as one of the most effective RERA authorities in India. By actively exercising its powers under the RERA Act, the Authority has successfully provided relief to homebuyers through refunds, interest on delayed possession, and enforcement of assured return agreements. Its efficiency in executing orders has made it a powerful tool for homebuyer protection.
However, while RERA Gurugram has made significant strides, challenges remain—especially concerning compensation claims. Many homebuyers receive delay penalties, but these often fail to account for the true financial and emotional burden they endure. A more holistic and liberal approach in awarding compensation would further strengthen homebuyer protection and align with the intent of the RERA Act. Nonetheless, RERA Gurugram continues to play a pivotal role in ensuring accountability in the real estate sector, offering a much-needed avenue for legal recourse and fostering confidence among investors and homebuyers alike.
