No delay interest if flat bought after occupancy certificate, K-REAT rules
The Karnataka Real Estate Appellate Tribunal held that a buyer who bought after a partial occupancy certificate cannot claim delay interest, but barred a Rs 250 per sq ft charge.
Key points
- The Karnataka Real Estate Appellate Tribunal on 30 October 2026 partly allowed a Nitesh Caesars Palace homebuyer's appeal against a K-RERA order.
- The tribunal held no delay interest was due because the sale deed of 18 January 2018 came after the 27 December 2017 occupancy certificate.
- The tribunal ruled the promoters cannot demand escalation charges of Rs 250 per square foot that the sale deed does not allow.
A homebuyer who bought a flat after the project's partial occupancy certificate was issued cannot claim interest for delayed possession, the Karnataka Real Estate Appellate Tribunal (K-REAT) held on 30 October 2026. The tribunal still ruled that the promoters of Nitesh Caesars Palace in Bengaluru cannot demand escalation charges from the buyer.
What Happened
According to the judgment, the buyer purchased a flat in the project under a registered sale deed dated 18 January 2018 for Rs 73 lakh, a price that included charges for amenities such as electricity and water connections and a sinking fund. The buyer complained that several amenities were not provided and that the firm which took over the project demanded Rs 250 per square foot more. The Karnataka Real Estate Regulatory Authority (K-RERA) dismissed the complaint on 10 March 2025.
K-REAT noted that in an appeal by another buyer in the same project, decided the same day, it had granted delay interest because that buyer's sale deed came before the occupancy certificate. Here, it held, the facts were different: the promoter obtained the partial occupancy certificate on 27 December 2017, before this buyer's sale deed. Under the Karnataka RERA Rules, a partial occupancy certificate for one phase of a project counts as a full certificate for that phase, the tribunal said. It also noted that no agreement for sale had been produced, and that no buyer had challenged the certificate, so it had become final.
On the extra charge, the tribunal found that the sale deed had no clause allowing escalation charges. It modified the K-RERA order to hold that the promoters are not entitled to demand any escalation charges from the buyer.
What It Means
The ruling draws a line for buyers in phased projects: those who bought after a phase received its occupancy certificate generally cannot claim delay interest, while earlier buyers may. In either case, a builder cannot add charges that the sale deed does not provide for. The K-REAT judgment can be appealed to the High Court.
Source: K-REAT judgment
Sources & Citations
- K-REAT judgment — Karnataka Real Estate Appellate Tribunal