MahaRERA Rejects COVID-19 Excuse, Orders Developer to Pay Interest for Delayed Possession

Pune, 30th April 2026: In a significant ruling for homebuyers, the Maharashtra Real Estate Regulatory Authority (MahaRERA) has directed Pune-based Five Star Construction Company to pay interest for delayed possession to a homebuyer, outright rejecting the developer’s attempt to use the COVID-19 pandemic as a “force majeure” excuse for an agreement signed in late 2022.

The order, pronounced by MahaRERA Member-I Mahesh Pathak on April 29, 2026, brings relief to Divya Gajwani, who had booked an apartment in the developer’s “ANP Memento” project located in Wakad, Pune.

According to the complaint, Gajwani booked Flat No. 1601 in Wing C of the project and executed a registered agreement for sale on December 23, 2022. Having paid over Rs. 70 lakh—accounting for roughly 85% of the total consideration—she was promised possession by June 30, 2025. When the developer failed to deliver the flat by the agreed date, Gajwani approached MahaRERA seeking possession, interest on the delay, and compensation under Section 18 of the RERA Act.

In its defense, Five Star Construction Company argued that the complaint was premature, pointing out that the project’s revised completion date on the MahaRERA website was September 30, 2026. The developer further contended that construction was delayed due to the COVID-19 pandemic and claimed the complainant had defaulted on timely payments.

However, MahaRERA dismantled the developer’s primary defenses. Pathak noted that because the agreement for sale was signed in December 2022—well after the COVID-19 pandemic had subsided—the developer was not entitled to seek any benefit or moratorium under the guise of pandemic-related “force majeure.”

Furthermore, the Authority clarified a crucial regulatory point: simply obtaining an extension for a project’s RERA registration does not allow a developer to unilaterally modify the possession date agreed upon with the buyer in the registered sale agreement.

While MahaRERA rejected the homebuyer’s separate plea for “compensation” since she opted to remain in the project rather than withdraw, the Authority ruled firmly in favor of granting interest for the delay.

Five Star Construction Company has been directed to pay interest at the State Bank of India’s Marginal Cost of Lending Rate (MCLR) plus 2% for every month of delay, calculated from July 1, 2025, until the flat is officially offered for possession with an Occupancy Certificate (OC).

In a balanced move designed to protect the broader interests of the project and prevent cash-flow disruptions that could stall remaining construction, MahaRERA directed that the actual payment of this interest be deferred until the occupancy certificate is obtained. At the time of possession, the developer is permitted to adjust the accumulated interest against any outstanding balance payable by the homebuyer. MahaRERA further added an equity clause stating that if the interest owed by the developer exceeds the buyer’s outstanding dues, the developer shall not raise any further financial demands and must set off the amount forthwith.

The ruling stands as a stern reminder to developers that standard force majeure clauses cannot be retroactively applied to contracts signed under normal operating conditions.