Builder demanding additional ₹1.5 lakh before handing over flat possession?

Question

I booked a flat in Pune two years ago and I am supposed to get possession next month. Suddenly, the builder is asking for an extra ₹1.5 lakh, saying there are additional charges not covered in the initial agreement. I already paid the agreed amount and have all receipts. This was never mentioned before and I'm worried they won't hand over the flat if I refuse. I feel trapped and unsure about my legal standing. Can the builder legally do this?

Adv. Neha Joshi · Accepted Answer

I'm Adv. Neha Joshi, and I understand how stressful this situation must be for you. Let's break down your legal standing under Indian law. In India, the relationship between a builder and a buyer is primarily governed by the Real Estate (Regulation and Development) Act, 2016 (RERA). This Act was enacted to protect home buyers and ensure transparency in real estate transactions. Here are the key points to consider: 1. **Agreement to Sale**: Your legal standing heavily depends on the terms outlined in the agreement to sale you signed with the builder. According to Section 13 of the RERA, a builder cannot demand any payment beyond what is stipulated in the agreement unless both parties mutually consent to the changes. If the agreement does not mention these additional charges, the builder cannot legally demand them. 2. **RERA Registration**: Ensure that the project is registered under RERA. You can check this on the official RERA website of Maharashtra. If the project is registered, you can file a complaint with the RERA authority for this unfair demand. 3. **Consumer Protection**: Under the Consumer Protection Act, 2019, you have the right to receive services without unfair trade practices. Demanding extra money without prior agreement could be considered an unfair trade practice. You can approach the Consumer Forum for redressal. 4. **Court Judgments**: The Supreme Court in Fortune Infrastructure & Anr. vs. Trevor D’Lima & Ors. (2018) held that builders cannot impose additional charges unless explicitly agreed upon by the buyer. 5. **Possession Delay**: If the builder refuses to hand over possession due to your refusal to pay the extra amount, it could be considered a delay. Under RERA, you could be entitled to compensation for any delay in possession. Here’s what you can do: Review your agreement to sale thoroughly to confirm the terms regarding payment. Communicate with the builder in writing, expressing your concerns and requesting a justification for the addition

Adv. Usha Krishnan · Answer

In situations like yours, it's crucial to refer to the original agreement you signed with the builder. The terms laid out in that agreement are binding on both parties. If the additional charges were not mentioned in the agreement, the builder cannot unilaterally demand extra payment without a legal basis.

Key Legal Considerations:

Agreement Terms: Check your sale agreement to see if it includes any clauses about additional charges or escalation clauses. If there are no such provisions, the builder's demand lacks contractual support.
RERA Compliance: Since your project is in Pune, the Real Estate (Regulation and Development) Act, 2016 (RERA) applies. Builders must register their projects under RERA, which mandates transparency and adherence to the terms agreed upon. Any additional charge not disclosed or agreed upon initially can be challenged under RERA.
Consumer Protection: You can approach the consumer forum under the Consumer Protection Act, 2019 if the builder's demand is unjustified. The forums have been proactive in protecting consumer rights against unfair trade practices.

Legal Precedents:

The Fortune Infrastructure v. Trevor D'Lima (2018) case is relevant here. The Supreme Court held that builders cannot demand additional charges unless expressly provided for in the agreement.

Steps You Can Take:

Written Communication: Send a formal letter or email to the builder disputing the additional charges and referencing the agreement terms.
File a Complaint with RERA: If the builder is registered under RERA, file a complaint with the Maharashtra RERA authority. They can enforce compliance with the agreed terms.
Consumer Forum: If the issue persists, consider filing a complaint with the consumer forum. This could be a quicker resolution path.
Legal Notice: As a last resort, send a legal notice through an advocate demanding possession as per the original agreement.

Timelines: RERA complaints and consumer forum cases can have specific time limits. It's advisable to act promptly to avoid any limitation issues.

In conclusion, the builder's demand seems unjustified unless backed by your agreement. You have strong legal avenues to challenge this demand and protect your rights.

📚 References

Adv. Mohan Das · Answer

It sounds like you are in a difficult situation, but let's look at your legal standing under Indian law. The key document here is the initial agreement you signed with the builder. This agreement should clearly outline all the costs involved in the purchase of the flat. If the additional ₹1.5 lakh was not mentioned in the agreement, the builder generally cannot demand this amount. Under the Real Estate (Regulation and Development) Act, 2016 (RERA), builders are required to adhere to the terms and conditions as agreed upon in the contract. They cannot unilaterally change the terms or demand additional charges unless these are specifically provided for in the agreement. Here are steps you can take: 1. **Review Your Agreement**: Check your sale agreement to ensure that there are no clauses allowing the builder to levy additional charges. 2. **Communication**: Write a formal letter or email to the builder stating your position clearly. Mention that you have fulfilled all payment obligations as per the agreement and that you expect the possession to be handed over as per the original terms. 3. **Lodge a Complaint**: If the builder is registered under RERA, you can file a complaint with the RERA Authority in Maharashtra. This is a relatively straightforward process and can be done online. 4. **Legal Notice**: If the builder does not respond to your communication, you may consider sending a legal notice through an advocate, demanding possession without additional charges. 5. **Consu

Adv. Rohit Verma · Answer

Hey there, I can understand why you're feeling stuck and worried about this sudden demand from the builder. It's frustrating when unexpected charges come up, especially if they weren't part of the original agreement. The short answer is: No, the builder cannot legally demand additional charges not covered in your initial agreement without your consent. Under the Real Estate (Regulation and Development) Act, 2016, any changes in the cost or additional charges must be transparently communicated and agreed upon by both parties. If your agreement does not mention these extra charges, the builder is on shaky legal ground demanding them now. Here's what I recommend you do next: Review your Agreement: Check your original sale agreement for any clauses regarding additional charges. If it's not mentioned, you have a stronger case. Send a Formal Notice: Draft a written notice to the builder stating that the demand for additional charges is not agreed upon in the contract. Send this via registered post and keep a copy and the postal receipt. Contact RERA: File a complaint with the RERA authority in Maharashtra. They are tasked with resolving disputes like this. You can do this online through the RERA website. Document Everything: Keep all communication with the builder documented. This includes emails, messages, and any receipts of payments made. Seek Legal Assistance: If the builder remains uncooperative, consult with a lawyer who specializes in real estate disputes for more personaliz

Builder demanding additional ₹1.5 lakh before handing over flat possession?

Report Content