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Prior to the Real Estate (Regulation and Development) Act 2016, builders penalised buyers 18% for delayed milestone payments while offering a nominal ₹5 per sq.ft monthly compensation for years of construction delays. RERA permanently abolished this unequal paradigm. ### 1. Parity of Interest Rates (Section 18 of RERA) Section 18 mandates strict statutory interest parity: * The rate of interest payable by the promoter to the buyer for delayed possession must match the interest rate charged by the builder for buyer default. * Across UP-RERA, HRERA, and MahaRERA, this is prescribed as **SBI Marginal Cost of Funds Based Lending Rate (MCLR) + 2.0%** (currently approx. 10.75% to 11.15% per annum). ### 2. Option to Withdraw vs Stay in the Project The buyer possesses sovereign statutory discretion under Section 18: * **Option A (Withdraw):** Demand 100% refund of all consideration paid to date, along with monthly interest from the date of each payment milestone till actual realization. * **Option B (Continue):** Retain the allotment and demand mandatory monthly penal interest payouts for every single month of delay until the physical Occupancy Certificate is issued. ### 3. State RERA vs NCLT (Insolvency) While the National Company Law Tribunal (NCLT) handles corporate insolvency under IBC, individual flat buyers are strongly advised to approach their respective State RERA Authority first, as RERA orders can mandate recovery certificates (RC) executed directly through District Magistrates.

Builder Delay Penalties Under RERA: Statutory Interest Calculations, NCLT vs State RERA Remedies

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