₹ 1.33 crore interest with full refund: Dubai buyer wins property dispute with Mumbai builder

The Maharashtra Real Estate Appellate Tribunal (MahaREAT) has protected a Dubai-based buyer from an unfair contract. Justice SS Shinde and Member Rajagopal Devara delivered the decision and ordered the Mumbai builder to provide full compensation including interest, ET Wealth reported.

Mr. Raghuwanshi booked two flats in Mumbai in 2015. The flats were standing ₹2.35 million a ₹3.17 million. He paid about 20% for each booking. These payments were ₹48.73 million and ₹66.56 crores.

Allotment deeds were signed by both parties, but no registered sale agreements followed. Ownership was promised before April 2017. However, the builder did not receive the approval certificate until May 2018. The buyer also found differences between the agreed terms and draft purchase contracts, according to the publication.

Raghuwanshi canceled both bookings and asked for his money back with interest. The builder combined the repayment with the search for replacement apartment buyers. She also relied on clause 12 in the allotment letters.

This clause allowed for the forfeiture of 10% of each purchase price. It also imposed a monthly interest rate of 1.5% until termination. These amounts may be deducted from the buyer’s refund, if any. Meanwhile, the buyer has not received any adequate compensation for the builder’s delay.

Raghuwanshi challenged this arrangement with the Bombay estate authorities. The MahaREAT ruled on his appeal on 1 July 2026. It rejected provision 12 as arbitrary and unreasonable. According to the tribunal, she significantly favored the builder.

The tribunal stated that repayment cannot be indefinitely dependent on further future sales. Finding replacement buyers remained entirely under the control of the builder. The builder had been using Raghuwanshi’s money for several years, he said.

MahaREAT also found serious violations of the law. The builder accepted substantial payments without entering into registered sales contracts. This violated Section 4(1) of the Maharashtra Tenancy Act, 1963.

The builder also did not secure possession on the promised date. Therefore, Section 18 of RERA entitled the buyer to refund with interest. Contractual clauses cannot defeat these statutory homebuyer protections.

MahaREAT ordered a refund of Rs ₹48.73 million and ₹66.56 crores. Interest applies from each due date until final realization. The rate is equal to SBI’s highest marginal lending rate plus two percentage points.

According to ET Wealth, the original payments amount to almost ₹1.15 million. So 10.5% annual interest over 11 years produces approx ₹1.33 million. Actual amount depends on applicable rates and payment dates.

MahaRERA Sample Ration Sheet

The decision also reflects the MahaRERA Model Allotment Sheet. Its cancellation rules limit deductions for builders based on timing.

Cancellation within 15 days does not allow for any deduction. Requests between 16 and 30 days are subject to a 1% deduction. Requests between 31 and 60 days are subject to a 1.5% fee. Later cancellation allows a maximum deduction of 2%.

The remaining balance should normally be returned within 45 days. Late repayment may trigger the prescribed interest. These guarantees prevent builders from withholding refunds through unequal standard contracts.