You cannot get 10 per cent monthly interest
2) you woukd get refund on cancellation at bank rate of interest
3) it is simple interest
4) amicable settlement is best option
What are the refund rules if a property deal gets cancelled because of legal issues (not by buyer)?
Hi Team.. We are from Mira Road, Mumbai. We bought a 1 BHK flat in Mira Road in June, 2019. We were supposed to get possession by December 2021. But due to legal issues, the work was on hold since 2019 itself. Now the developer is saying the property is getting cancelled after waiting for almost 5 years. So far we have paid almost 50% of the flat cost and we have an ongoing loan on it. Now, I read somewhere in Rera that the developer is supposed to pay 10% monthly interest. But the developer is giving 10% yearly interest only on capital (not on GST, neither on Stamp duty). Can someone please help us know about the rules? 1. How much refund should we expect? 10% monthly? 10% yearly? 2. Is it Compound Interest or Simple Interest? 3. Do we get interest on GST and Stamp Duty cost as well? 4. How should we deal with the developer? We wanted to avoid Rera complaint as that would take long. Please help us.
Asked 26 days ago in Property Law
Religion: Hindu
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7 Answers
1. It's not possible to pay 10% interest per month, you are under misconception, it would per annum.
2. It will be simple interest.
3. You may not get interest on GST and stamp duty.
4. You can negotiate with the developer if you want to avoid RERA procedures.
Dear client, under section 18 of RERA Act you can get compensation if the developer delays in giving the possession of the flat. According to the Real Estate (Regulation and Development) Act (RERA) of 2016, the minimum compensation a buyer can receive for delayed possession of property is 2% of the property value per month. And also the buyer can seek compensation for the delay in possession along with interest and possession of the property. The interest rate is typically set at 10% of the total amount invested by the buyer.
- There is no straight jacket formula for the same it is as per agreed terms. Generally the person who is responsible makes the loss good
If the developer is refunding the money with nterest @ 10% pa then without thinking accept this proposal.
If you take the recourse to law like RERA you will have t wait another 6-7 years to get the desired results.
It should be simple interest as per the maharera rules. Check this with a local lawyer. Since the builder is not processing your refund in accordance with law, send him a legal notice through a lawyer and seek refund with interest as per applicable rera prescribed rate of interest
1. As per the RERA Act, if the builder is delaying in construction & delay in possession, then the builder will have to pay 10% interest per annum on the value of the property for delayed possession of flats.
- Since, the said delay and cancellation on the part of the developer , then you can also claim compensation for mental harassment from him.
2. Generally simple interest awarded by the court.
3. Yes, you can claim the same from him
4. You can send a legal notice for claiming the entire paid amount with 18% percent p.a. with the compensation for mental harassment
- If refused , then file a complaint before the Consumer forum.
