Possession Offer Without OC Is Not a Legal Offer, NCDRC Rules; Orders Refund to Homebuyers

New Delhi, October 16, 2025 — The National Consumer Disputes Redressal Commission (NCDRC) has held that a developer’s offer to hand over possession of flats without obtaining a valid Occupancy Certificate (OC) cannot be treated as a legal offer. In a landmark order, the Commission has directed the developer to refund the amounts paid by homebuyers, along with interest. 

Background of the Case

The decision comes from a dispute involving Mantra Lifestyle Homes Pvt. Ltd. and its project Unique Apex Towers in Jaipur. The project suffered a delay of about four years, during which homebuyers filed complaints before the NCDRC.

According to the case record:

• The developer had proposed possession to purchasers although the OC had not been secured. 

• At least seven complainants approached the NCDRC seeking redress, claiming that despite fulfilling their payment obligations, possession was never handed over and no OC was produced.

• The promised date of possession was November 2021, but that deadline was missed. 

NCDRC’s Ruling

After examining the submissions, the Commission ruled as follows:

• Possession without OC is not a valid legal offer. The court held that unless the statutory requirement for an OC is met, the developer cannot validly demand acceptance of possession.

• The complainants had a right to refuse possession in absence of OC, and to claim refund of their payments with interest. 

• The developer must refund the deposited amounts to the seven complainants with interest at 9% per annum from the dates of deposits until realisation. This refund must be completed within eight weeks. 

• If the refund is delayed beyond eight weeks, the interest rate shall increase to 12% per annum. 

• The NCDRC rejected the developer’s objections regarding pecuniary jurisdiction and their plea of force majeure (on grounds of COVID disruption and sand-supply restrictions). The court found that the delay was “unusually long” and the developer had failed to show proper justification.

• The developer was also directed to initiate UAP (Unauthorised Possession) cases in that area against similar unauthorized constructions. 

Significance & Implications

This ruling reinforces consumer protection in real estate transactions:

• It underscores that developers cannot lawfully compel buyers to accept possession without a valid OC.

• Homebuyers have a stronger legal footing to demand refunds when projects are delayed and statutory clearances are missing.

• Developers must ensure compliance with building approvals and OC norms before offering possession, or face legal and financial consequences.

For homebuyers facing delays or OC issues, this judgment is a positive precedent. It gives them a stronger basis to challenge possession offers made without OC and demand refunds or compensation.