Telangana RERA orders 10.7% interest compensation and rejects debris fee for delayed flat
The Telangana Real Estate Regulatory Authority ruled that a builder must pay 10.7% annual interest on the amount paid by homebuyer VenuGopal and cancel an unauthorized Rs 30,000 debris charge after failing to deliver possession on time.
In February 2023, VenuGopal signed an agreement to purchase a tenth-floor flat in a Bachupally project, paying Rs 40.32 lakh toward a total price of Rs 44.36 lakh, with possession slated for December 26 2024 and a grace period extending to August 2025. The developer repeatedly altered the timeline, eventually extending the deadline to December 18 2026, while also levying an undisclosed Rs 30,000 debris charge. The builder attempted to justify delays by invoking Covid-19 and land-encroachment disputes, but Telangana RERA rejected these arguments, noting the contract was signed after the pandemic’s peak and that the cited issues pertained to other blocks.
The authority declared the debris fee unsupported by the agreement and ordered the builder to pay interest compensation at a rate of 10.7% per year on the amount already paid, calculated from June 2025 until actual possession. The builder must settle accrued interest within 60 days, with ongoing monthly interest if payment is delayed. VenuGopal may also file a separate claim for mental anguish and other losses under Form N.
Why it matters
The ruling reinforces buyer protection under India's RERA law and signals that developers cannot use pandemic excuses to avoid contractual duties.
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