Q. Has the Centre declared the West Asia war situation a “force majeure” event allowing extension of timelines for real estate projects? If so, what is the extension period? How will it affect homebuyers? Will buyers be denied interest for this “force majeure” period in projects already delayed? Shirish Mulekar, Pune
A. The Centre has officially treated the West Asia conflict as a “war” for invoking the force majeure provisions under RERA. Through a circular dated July 31, the Ministry of Housing and Urban Affairs has advised all State RERA authorities to grant a uniform four-month extension to registered real estate projects whose completion dates fall on or after February 28.
The circular refers to the Ministry of Finance’s Office Memorandum dated April 29, which treated the ongoing West Asia situation as “war” for invoking the force majeure clause.
The Housing Ministry also received representations from stakeholders stating that the conflict disrupted global supply chains, caused shortages of construction materials and affected timely completion of real estate projects. Section 6 of RERA permits extension of project registration on force majeure grounds, and “war” is specifically recognised as one such ground.
The government has, therefore, advised RERA authorities in all states to issue appropriate orders or directions granting a fourmonth extension for projects whose completion dates fall on or after February 28. RERA authorities, including MahaRERA, are consequently expected to issue a blanket extension order shortly.
However, the July 31 circular concerns only Section 6, which deals with extension of project registration due to force majeure. It does not advise RERA authorities to grant an “interest holiday” for the four-month period from February 28, 2026, or deprive homebuyers of interest payable on refunds when they exit projects because of delays already incurred.
Similarly, the circular gives no exemption to promoters from paying monthly interest for continuing delays in projects already delayed as of February 28, where buyers choose to remain in the project.
Promoters may nevertheless argue that, because completion timelines have been extended by four months after declaring the West Asia situation a war and force majeure event, no interest should be payable during that period. At first glance, the argument may appear logical.
However, Section 18 of RERA, which provides for interest on refunds to buyers exiting delayed projects and monthly interest to buyers continuing in them, does not make this liability conditional upon, or subject to, any force majeure clause.
The Supreme Court, in Imperia Structures Ltd v Anil Patni & Anr and Newtech Promoters & Developers v State of U P & Ors, has held that the homebuyer’s right to interest at the prescribed rate under Section 18 is “unqualified” and “indefeasible”.
Further, Clause 6 of MahaRERA’s Model Agreement for Sale does not exempt promoters from interest liability merely because delay arose from circumstances beyond their control.
In my opinion, force majeure may operate only as a mitigating factor where buyers seek compensation in addition to statutory interest.
Nevertheless, whether the West Asia war declaration can suspend interest liability remains a legally untested and grey area.
The Union Housing Ministry should issue a clarificatory circular stating its position. Any aggrieved party may then approach the courts for a final determination.
(Advocate Shirish V Deshpande is chairman, Mumbai Grahak Panchayat. Queries can be sent to him on email: shirish50@yahoo.com)
