SC orders builder to pay 18% interest for delayed handover of plot’s possession

In a relief to home/plot buyers, the Supreme Court has said that a developer/builder who imposes 18% interest on buyers for delayed payments cannot evade the same liability if he fails to deliver possession of a plot/flat on time to the consumer.

“There is no principle of law that interest in default charged by the builder can never be granted to the buyer,” a Bench of Justices Dipankar Datta and A.G. Masih said, enhancing interest from 9% to 18% for delayed handover of possession of a plot to a buyer.

In this case, the possession of the alternative plot allotted in 2011 to appellant Ranjesh Sharma was offered only in 2018. He paid a total sum of Rs 43,13,312.67 of which Rs 83,300.76 was towards interest @18% per annum charged by the respondent (developer) for Sharma’s default/delay in m