Should I withdraw and seek a refund or continue in a delayed RERA project?

Question

My project is delayed by three years with no clear completion date. Should I withdraw and demand a refund, or stay and claim interest until possession? What I am unsure about is the procedure — where the application goes, what it costs, and how long rera refund vs interest matters usually take. A plain explanation of the steps, in order, would help more than a general answer.

MyVakeel Legal Desk · Accepted Answer

The law that applies to rera refund vs interest here is Real Estate (Regulation and Development) Act 2016, Section 18, Real Estate (Regulation and Development) Act 2016, Section 19 and Real Estate (Regulation and Development) Act 2016, Section 20. The detail below matters, because Real Estate (Regulation and Development) Act 2016, Section 18 draws the line differently depending on what your documents show.

Section 18(1) gives an allottee an unconditional right to withdraw from the project and claim a full refund of the amount paid along with interest and compensation if the promoter fails to complete construction or hand over possession by the date fixed in the agreement.

Section 18(2) allows an allottee who does not wish to withdraw to remain invested and instead claim monthly interest for every month of delay until possession is actually handed over with an occupancy certificate.

Section 19 protects allottees' rights to timely information about project status, sanctioned plans and stage-wise construction progress, which helps in deciding whether the project is likely to be revived.

Where a project is stalled indefinitely with no realistic completion timeline, Section 20's establishment of the real estate regulatory authority and the possibility of a lapsed registration under Section 7 are relevant factors, since a cancelled registration can trigger refund obligations for all allottees.

The choice between refund and continuation is fact-specific and depends on construction progress, the promoter's financial health, and whether the market value of the unit has appreciated enough to justify staying invested.

What to do next: 1) Assess actual construction progress and the promoter's financial standing through the RERA quarterly updates; 2) Calculate the refund-with-interest amount versus the monthly interest-for-delay amount to compare outcomes; 3) File a Section 18 complaint clearly stating whether you seek refund or continuation with interest; 4) Consult a RERA lawyer before committing to either remedy, since the choice is generally final once adjudicated.

If you are unsure whether your facts fall inside Real Estate (Regulation and Development) Act 2016, Section 18, that is worth checking with an advocate before you commit to a route, because switching later costs time. You can post the details on the MyVakeel forum for a practising advocate to review, or book a paid consultation with a Bar Council verified lawyer in property law.