Overview
When a project is hopeless — stalled for years, the builder diverting funds, or your circumstances changed against an endless wait — Section 18 lets you withdraw and claim everything you paid with interest at the prescribed rate, plus compensation. Refund orders are enforceable as recovery certificates through the district collector. Where the builder has entered insolvency, homebuyers are financial creditors under the IBC with a seat in the committee of creditors — a different, collective route. Cancellation by the buyer before delay (change of mind) instead follows the agreement's forfeiture clause, which RERA authorities cap at reasonable levels against gouging.
Key Provisions — RERA + Insolvency framework, 2016
- Section 18 — on withdrawal for delay, the promoter returns the full amount with prescribed interest and compensation.
- Refund orders convert to recovery certificates executed as land-revenue arrears through the collector.
- Homebuyers are financial creditors under the IBC (2018 amendment) — claims filed with the resolution professional in builder insolvencies.
- Buyer-side cancellations: forfeiture is limited to reasonable earnest money (commonly ~10%), not the fantasy figures in builder agreements.
What You Can Get
How We Handle It
Exit Strategy
Refund vs stay-and-interest vs IBC — chosen on the project's real prospects.
Withdrawal & Complaint
Formal withdrawal notice and the Section 18 refund complaint.
Order & Certificate
Refund order, then recovery certificate where the builder doesn't pay.
Collector / IBC Execution
Land-revenue recovery — or the insolvency claim pursued with other buyers.
Frequently Asked Questions
The builder says my money is 'adjusted' and offers another project instead — must I accept?
No. Section 18 gives you money with interest, not a forced swap. Unit-swap offers are for you to accept or refuse on merits.
The project went into insolvency after my RERA order — is my order dead?
The moratorium pauses execution, but your claim converts into the IBC process as a financial creditor. File with the resolution professional immediately — deadlines there are short.
Legal Connect connects you with independent advocates; we are not a law firm and this page is general information, not legal advice. Homebuyer groups filing together get the strongest outcomes — call +91 22 6555 3444.