Homebuyer stuck with a delayed flat? The law gives you a clear remedy.
You booked a home, paid your instalments on time, and waited for possession that never came on the promised date. Under the Real Estate (Regulation and Development) Act, 2016, that delay is not something you simply have to absorb. Section 18 gives every allottee a concrete, enforceable right: either walk away with a full refund plus interest, or stay and be paid interest for every month the builder keeps you waiting.
This guide explains what Section 18 actually says, how the refund and interest are calculated, how to file, and how litigation funding lets you pursue a high-value RERA claim without paying legal costs out of pocket.
What Section 18 of RERA says
Section 18 applies when a promoter (the builder or developer) fails to complete the project or is unable to give possession of the apartment, plot or building by the date specified in the sale agreement. When that happens, the allottee has two choices:
- Withdraw from the project. The promoter must return the entire amount you have paid, together with interest, and pay compensation. You owe nothing further.
- Continue with the project. If you choose to keep the flat, the promoter must pay you interest for every month of delay, until possession is actually handed over.
The right to interest is not discretionary. It is a statutory entitlement the moment the agreed possession date passes without possession. You do not have to prove loss the way you would in an ordinary civil suit.
How the interest is calculated
The rate is fixed by the rules of your State RERA, not left to the builder. Across most states the prescribed rate is the State Bank of India’s highest marginal cost of lending rate (MCLR) plus 2 percent. The same rate applies both ways — so if a buyer defaults, the builder charges this rate, and when the builder delays, they must pay you at exactly the same rate. This symmetry is a core principle of RERA.
For a delayed project where you have paid, say, ₹50 lakh, an annual delay interest in the region of 10 to 11 percent can add up to several lakh rupees a year — which is precisely why builders resist paying it and why buyers often need to enforce the order.
Where you file a Section 18 claim
A Section 18 claim is filed as a complaint before your State Real Estate Regulatory Authority, or before the Adjudicating Officer where you are also seeking compensation. In broad terms the path is:
- File a complaint with the State RERA against the registered project and promoter
- The Authority or Adjudicating Officer hears both sides and passes an order for refund and/or interest
- Either party may appeal to the Real Estate Appellate Tribunal (REAT), and from there to the High Court on questions of law
- If the builder does not comply, the order is enforced through execution, recoverable as arrears of land revenue
Winning the order is often only half the battle. Many buyers secure a RERA order and then face a builder who stalls, appeals, or claims to have no funds — which turns the fight into a recovery and enforcement exercise.
Why builder-delay cases stall — and how funding solves it
A homebuyer who has already sunk their savings into a delayed flat is rarely keen to spend several more lakh on lawyers, appeals and execution against a well-resourced developer. That imbalance is exactly what stops legitimate Section 18 claims.
This is where litigation funding changes the equation. Under a non-recourse arrangement, the funding covers the legal costs of pursuing and enforcing your RERA claim, and is repaid only from what is actually recovered. If the recovery does not come through, you owe nothing. You are matched with an empanelled advocate, and you keep control of the key decisions, including settlement.
For a delayed-possession refund of, say, ₹40 lakh or more against a solvent developer, this makes the difference between writing the loss off and actually recovering your money with the interest the law entitles you to.
Is your RERA claim a good fit for funding?
A builder-delay claim is generally worth assessing for funding when:
- The amount at stake — refund plus accrued interest — is roughly ₹15 lakh or more
- Your paperwork is strong: the sale agreement with the possession date, payment receipts, and the RERA registration of the project
- The promoter is a real, financially capable entity that can satisfy an order
- There is a clear recovery path, whether the matter is at complaint, appeal or execution stage
Note that RERA remedies are civil and regulatory. Fund My Case funds commercial and civil recovery claims of this kind; it does not fund criminal complaints or matters where you are the party who must pay.
How Fund My Case helps
Fund My Case is a litigation finance and litigation management platform for individuals, SMEs and corporates in India. For an eligible RERA delay or refund claim, the arrangement covers legal fees, experts and enforcement costs, and is non-recourse — you repay only from a successful recovery.
- Minimum claim size around ₹15 lakh
- Non-recourse: pay nothing if the claim does not succeed
- Support through complaint, appeal and execution, including enforcement of RERA orders
- Empanelled advocates matched to your forum, with you retaining control of your case
Check whether your builder-delay claim qualifies: Fund My Case eligibility tool
Frequently asked questions
Yes. If the promoter fails to give possession by the date in your agreement, Section 18 lets you withdraw and claim a refund of the entire amount you have paid, together with interest and compensation. If you prefer to keep the flat, you are instead entitled to interest for every month of delay until possession.
The rate is set by your State RERA rules, most commonly the SBI highest MCLR plus 2 percent. The same rate applies to both buyer and builder, so the interest a delayed builder owes you is calculated on the identical basis they would charge you.
You file before your State Real Estate Regulatory Authority, or the Adjudicating Officer where compensation is also sought. Orders can be appealed to the Real Estate Appellate Tribunal, and unpaid orders are enforced through execution.
An eligible RERA refund or delay claim of roughly ₹15 lakh or more, with strong documents and a solvent builder, can be assessed for non-recourse funding. The funding covers the cost of pursuing and enforcing the claim and is repaid only from what is recovered.
A RERA order can be executed and recovered as arrears of land revenue. Enforcement is often the hardest and most expensive stage, which is exactly what funded mandates are designed to carry through so that a paper win becomes an actual recovery.
Conclusion
A delayed flat is not a dead end. Section 18 of RERA gives you a statutory right to your money back with interest, or interest for the delay if you stay. The obstacle is rarely the law — it is the cost and effort of enforcing it against a developer with deeper pockets. Litigation funding removes that obstacle, so a genuine claim can be pursued and recovered without financial risk to you.
This article is for informational purposes only and does not constitute legal advice. RERA rules and prescribed interest rates vary by state and change over time. For advice specific to your matter, please consult a qualified legal professional.