K-REAT orders Purvankara to pay delay interest to villa buyer in Sound of Water project

The Karnataka Real Estate Appellate Tribunal (K-REAT), Bengaluru, on 13 October 2026 set aside an order of the Karnataka Real Estate Regulatory Authority (K-RERA) dated 26 May 2025 and directed Purvankara Limited to pay a homebuyer interest for delay in handing over two villas. The villas are in the builder's "Sound of Water - Phase 1" project in Bengaluru. K-RERA had dismissed the homebuyer's complaint as not maintainable.

What Happened

Per the judgment, the homebuyer signed sale and construction agreements on 4 August 2015. The builder was to hand over possession within 36 months, with a grace period of six months, so by 4 February 2019 at the latest. The sale deed was signed and possession given only on 7 July 2021. The builder argued that the buyer had paid instalments late and had signed a declaration on 7 July 2021 giving up further claims.

K-REAT rejected both defences. It found that most clauses of the agreements were one-sided and favoured the builder, and held that the builder could not use the buyer's late payments to defeat his claim for delay interest when it had itself missed the possession date. It noted that only a photocopy of the declaration was on record, the builder did not produce the original when asked, the buyer's name appeared to have been filled in later on a printed form and the witness column was blank. It also noted that K-RERA had granted delay interest to two other buyers in the same project.

K-REAT ordered the builder to pay interest at the SBI MCLR plus 2% a year on Rs 99,78,113 from 5 February 2019, on Rs 2,01,45,190 from 30 January 2020 and on Rs 62,85,415 from 21 June 2021, in each case up to 7 July 2021, within 30 days of the order.

What It Means

For homebuyers, the ruling shows that delay interest under the RERA Act can be claimed even after taking possession, and that a standard-form waiver signed at handover may not stand when its authenticity is in doubt. K-REAT's judgment may be appealed to the High Court.

Source: K-REAT judgment