Offer of Possession Without OC Is No Possession at All: UP RERA Awards Delay Interest in Hindon Green Valley

Devesh Saxena

6 days ago

3 min read

Your possession date has passed. Then a letter arrives titled “Offer of Possession”, with a fresh demand for money, but no Occupancy Certificate (OC) or Completion Certificate (CC). Does that letter end the builder’s delay?

UP RERA has said no. Deciding a homebuyer’s complaint in the Hindon Green Valley project at Indirapuram, Ghaziabad, the Authority has held that an offer of possession without OC or CC is not valid in law, and that the buyer is entitled to interest for the delay. Here is what that means for you.

RERA in 60 Seconds

The Real Estate (Regulation and Development) Act, 2016 requires projects to be registered with a State regulator and lets a homebuyer file a complaint before it under Section 31. If possession is delayed, Section 18 gives the buyer a choice: exit with a refund and interest, or stay and be paid for the delay. For the buyer who stays, the proviso to Section 18(1) says:

“Provided that where an allottee does not intend to withdraw from the project, he shall be paid, by the promoter, interest for every month of delay, till the handing over of the possession, at such rate as may be prescribed.”

Infographic by S&D Legal Associates titled "Offer of Possession Without OC: The Order at a Glance" for Hindon Green Valley, Indirapuram, Ghaziabad. It shows four steps: the situation (possession date passes, builder sends a possession letter with a demand, but there is no OC or CC); what the homebuyer and builder each argued; what UP RERA held (no deemed completion, possession letter not valid, delay interest payable); and the relief (possession with OC/CC in 45 days, interest at MCLR + 1% till OC/CC or offer of possession, and penalty under Section 63 for non-compliance). It ends with the line "Before you pay or sign, ask: where is the certificate?"

The Common Problem: An Offer of Possession Without OC

Does this sound familiar? The date promised in your agreement has gone by. The builder says the project is complete and that it has “applied” for the certificate. A possession letter arrives with a final demand, and you are told to pay up and take the keys. Meanwhile, your EMIs continue.

This is the situation that reached UP RERA through complaints filed by the allottees of the project Hindon Green Valley.

What Each Side Typically Argues

The homebuyer

Possession was not given by the agreed date, so interest is payable under Section 18.
A possession letter issued without OC/CC is contrary to the Act and is not a valid offer.
The certificate is not merely pending; records obtained under RTI show that the application was not granted.

The builder

It has applied for the completion certificate with the required NOCs, so the project should be treated as “deemed” complete.
Force majeure and COVID-19 entitle it to extra time beyond the agreed date.
Possession has already been offered; the buyer should pay the balance and take the flat.

What UP RERA Held on the Offer of Possession Without OC

No “deemed” completion. Where the development authority has objected to and rejected the application, and the promoter cannot show that it cured the objection or applied again, the project is not in the deemed category.

The possession letter is not valid. Under UP RERA’s office order dated 29.05.2024, a promoter cannot offer possession before obtaining the OC/CC.

Delay interest is payable. Relying on Supertech Ltd. v. Rajni Goyal (Supreme Court, Civil Appeal Nos. 6649-50 of 2018) and Neelkamal Realtors Suburban Pvt. Ltd. v. Union of India (Bombay High Court, Writ Petition No. 2737 of 2017), the Authority treated interest as compensation, not penalty. The promoter’s force majeure plea did not earn it any extension.

The relief granted

Possession with OC/CC, completion of promised facilities and registration of the sale deed within 45 days, on payment of the balance due.
Interest at MCLR + 1% on the amount deposited, from the day after the promised possession period ended till the OC/CC or the offer of possession, whichever is later, to be adjusted in the final payment.
The same rate applies to the buyer on any delayed payment, in line with Section 2(za).
Non-compliance is punishable under Section 63, and the buyer may seek execution through the Authority.

Three Takeaways for Homebuyers

Ask for the certificate. An offer of possession without OC or CC does not stop interest from running.
“Applied for” is not “received”. A pending or rejected application does not make a project complete.
Use RTI. A reply from the development authority can settle what the true status of the certificate is.

Do note that every order turns on its own facts and remains open to appeal before the UP Real Estate Appellate Tribunal.

Received an Offer of Possession Without OC? Talk to Us

Please do not sign a possession letter, undertaking or “full and final” document under pressure. Keep your agreement, receipts and the builder’s emails ready, and ask one question: where is the certificate?

S&D Legal Associates represents homebuyers before UP RERA, the Appellate Tribunal and the Allahabad High Court. Write to sndlegalassociates@gmail.com or call/WhatsApp +91 8181932240. Know someone paying EMIs for a flat they cannot move into? Share this with them.

Disclaimer: This article is for general information only and is not legal advice. Orders discussed here turn on their own facts and may be subject to appeal.

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