Extension with and Without Consent of Allottees: What You Need to Know?

09 January 2025

Understanding RERA Extensions: With and Without Consent of Allottees

The Real Estate (Regulation and Development) Act, 2016 (RERA) governs the extension of project registrations to ensure that projects are completed on time while safeguarding the interests of homebuyers. In addition to Section 6, which deals with force majeure events, Section 7(3) outlines the process for obtaining an extension of project registration in cases where delays are not due to such unforeseen events. This section specifically covers two main scenarios: one where the consent of 51% of the allottees (homebuyers) is required and another where it is not necessary.

Extension with Consent of Allottees (51% Required)

In certain situations, when promoters require more time to complete a project, they must obtain written consent from at least 51% of the allottees before applying for an extension. The process is as follows:

Obtaining Consent: If a promoter needs additional time due to delays other than force majeure, they must secure the consent of at least 51% of the allottees in writing.
Submission Process: This written consent must then be submitted alongside the application for an extension to the MahaRERA (Maharashtra Real Estate Regulatory Authority).
Review by MahaRERA: After submission, MahaRERA will review both the extension request and the consent documents. If the authority is satisfied with the reasons for delay and the revised project completion timeline, the extension may be granted.

Extension without Consent of Allottees

In some circumstances, promoters can apply for an extension without the need for 51% consent from the allottees. This applies when the delay is caused by certain factors outside of the promoter's control, such as:

Force Majeure: If delays are due to force majeure events like natural disasters, pandemics, or wars, the promoter is not required to seek consent from the allottees.
Court Orders: If the project is delayed due to legal proceedings or court orders, consent from the allottees is also not necessary.
Government Notifications: Changes in government regulations, laws, or policies that affect the project timeline also justify an extension without the need for consent from homebuyers.

Authority’s Discretion in Granting Extensions

Regardless of whether consent is obtained or not, MahaRERA has the discretion to grant or reject an extension based on the following criteria:

Validity of Delay Reasons: The promoter must provide valid reasons for the delay
Revised Completion Timeline: The authority will also assess the revised timeline for project completion. If the reasons and the new timeline are satisfactory, the extension will likely be approved.

If MahaRERA is not convinced about the reasons or the revised timeline, the extension application may be rejected, and the promoter will need to take corrective actions to comply with RERA

Why Understanding Extension and Consent Is Important

The provisions under Section 6 and Section 7(3) ensure that real estate projects are completed within a reasonable timeframe and provide a legal framework that protects the interests of homebuyers. Here’s why understanding these provisions is critical for both promoters and allottees:

For Promoters: Knowing how to apply for extensions, especially under Section 6 for force majeure situations, helps promoters stay in compliance with RERA regulations. Securing the consent of 51% of allottees under Section 7(3) is essential when delays are due to reasons other than force majeure.
For Homebuyers: Understanding the process of extension and your rights in case of delays helps homebuyers make informed decisions about their investments and ensure they are protected in the event of project delays.

Conclusion

The process for obtaining an extension under RERA is clear-cut when promoters follow the outlined procedures and provide valid reasons for delays. Whether the extension is due to force majeure under Section 6 or for general delays under Section 7(3), understanding the legal framework and the consent requirements is crucial for both promoters and homebuyers.

By adhering to RERA regulations, promoters can avoid penalties and ensure timely project completion. For homebuyers, staying informed about the extension process is key to safeguarding their investments and rights. If you're a promoter looking to apply for an extension or a homebuyer seeking clarity about your rights, understanding these provisions will help you navigate the real estate market with confidence.

By following these steps, promoters can maintain transparency, avoid legal complications, and keep their projects on track. For homebuyers, staying informed about the extension process ensures that their investments are protected, no matter the delays.