The Karnataka Real Estate Regulatory Authority (KRERA) has directed Bengaluru-based developer Golden Gates Properties Ltd to pay ₹1.08 crore in delayed interest to a homebuyer for failing to deliver possession of an apartment in Presidential Tower, one of Bengaluru’s tallest residential projects, standing 161 metres high with 50 storeys.
According to the order, the buyer had booked a luxury apartment worth nearly ₹2 crore in 2014, with a promised delivery date of 2017. However, the project, a 50-storey luxury high-rise located in Yeshwanthpur, was delayed for several years, prompting the buyer to file a complaint before the regulator.
“The Respondent is hereby directed to pay delay period interest of ₹1.08 crore calculated at the rate of SBI MCLR 2% from 2017 till 2024,” the order said. Further, the interest due from 2024 till actual delivery of possession will be calculated likewise and paid to the Complainant,” it said.
The case
In this case, the buyer, Premlatha, entered into a sale agreement with the builder on November 29, 2014, to purchase a flat in A Block of the Presidential Tower project for ₹1.98 crore and paid ₹1.5 crore as per the payment schedule.
The developer had promised possession by November 1, 2017, with a four-month grace period, but the flat has not been handed over yet. The complainant, who made all payments on time, has approached the KRERA seeking interest for the delay and directions to complete the project with pending amenities, the order said.
Multiple project extensions
The KRERA order stated that the project’s registration was originally valid from July 1, 2014, to June 30, 2021, and was later extended due to COVID-19 till March 30, 2022. The promoter then applied for an extension under Section 6 of the RERA Act, which was approved until March 3, 2023.
Also Read: KRERA orders BDA to register long-delayed Nadaprabhu Kempegowda Layout project
Since the project was still not completed, the Authority granted another extension under Section 7(3) of the Act, allowing the project to continue until December 31, 2025.
KRERA findings
The KRERA noted that the agreed possession date for the flat was 2017, with an additional grace period of four months as per the sale agreement. “The complainant paid substantial sums and complied with payment obligations, yet the possession has not been handed over to date,” it said.
KRERA said that the developer cited RERA extensions and the pandemic as reasons for the delay. “There is no documentary material placed on record showing that the complainant gave consent to vary the agreed date in the sale agreement or that a fresh agreement varying the contractual date was executed with the complainant,” the order said.
The authority also clarified that administrative extensions under RERA do not amend private contracts or exempt promoters from paying delay compensation.
KRERA noted that the developer had offered the buyer a one-time concession of ₹10.5 lakh as a settlement, which the buyer was not bound to accept. The builder cited COVID-19 and force majeure for the delay, but failed to provide specific, month-wise evidence of labour or material shortages affecting the flat’s handover, it said.
Also Read: Bengaluru real estate: Property owners say e-Khata process remains riddled with delays and paperwork
A list of questions has been sent to the developer. The story will be updated if a response is received.