Eco City 2 Plot Delay Interest Runs From Allotment Letter इको सिटी टू में प्लॉट देरी का ब्याज आवंटन पत्र से गिना गया ਈਕੋ ਸਿਟੀ ਟੂ ਪਲਾਟ ਦੇਰੀ ਦਾ ਵਿਆਜ ਅਲਾਟਮੈਂਟ ਪੱਤਰ ਤੋਂ ਗਿਣਿਆ

A Punjab RERA order on a residential plot in Eco City Two, New Chandigarh, has fixed when the delay clock started against GMADA for one allottee. The authority ran interest from the date of the allotment letter, which came almost five years after the letter of intent. It stopped the interest on the day the plot was demarcated on the ground.

The order was passed on the twenty eighth of October twenty twenty six by Binod Kumar Singh, a Member of the Real Estate Regulatory Authority, Punjab, on a complaint filed in May twenty twenty five. The Greater Mohali Area Development Authority was the respondent, as the promoter of the scheme. This piece sets out the dates in the case and the authority's reasoning on the letter of intent. It then explains what was ordered and what the order leaves open. The timeline with this piece marks each dated step.

The plot and its papers

The allottee applied for a residential plot of three hundred square yards in the general category of Eco City Two and was successful in the draw of lots held in June twenty fifteen. GMADA then issued a letter of intent dated the twenty seventh of August twenty fifteen. That letter assigned no plot number.

Clause fourteen of the letter of intent is at the centre of the case. The order reproduces it in full. The clause said the development works at the site would take approximately thirty six months. The allotment letter would follow once all development works were complete. It added that possession "shall be taken by the allottee within" thirty days of the allotment letter, failing which possession would be deemed to have been handed over.

A separate numbering draw for specific plot numbers was held on the twenty second of October twenty nineteen. GMADA issued an allotment cum possession letter for a specific park facing plot on the thirtieth of June twenty twenty. A demarcation and marking certificate followed on the twenty seventh of December twenty twenty one.

No agreement for sale was ever signed. GMADA accepted in its reply that no separate registered agreement for sale in the format prescribed under the Act had been executed, though more than ten per cent of the plot cost had been collected. It said this was common in legacy government schemes launched before or around the time the Act came into force.

What each side argued

The allottee counted the delay from the letter of intent. On that reading, possession was due within thirty six months of the letter. The complaint put the delay at about forty months. The complaint sought interest for that whole period at a fixed rate it proposed, with litigation costs.

GMADA argued that Eco City Two was a government scheme launched in twenty fifteen, before the Act's main provisions took effect. It said the letter of intent and the allotment letter, both made subject to the Punjab Regional and Town Planning and Development Act of nineteen ninety five, formed the contract between the parties. It put the gap down to the time taken for development works and for environmental and technical clearances. It also pointed to the numbering draw and, later, to disruption from Covid. On that basis it pleaded force majeure, and asked the authority to weigh that context if it counted any delay.

Why the letter of intent did not start the clock

The authority held that the letter of intent created no allotment. In the order's words, it "merely conveyed the promoter's intention to allot a plot subject to fulfilment of the stipulated conditions and did not, by itself, constitute an allotment or an Agreement for Sale creating enforceable contractual rights under the RERD Act."

It then turned to the definition of an allottee in section two of the Act. An allottee is the person to whom a plot, apartment or building "has been allotted, sold" or otherwise transferred by the promoter. The order describes the allotment letter as the document that "confirms the allotment after fulfilling the conditions".

The timing of the letter of intent also mattered. The order notes that when it was issued, the sections of the Act on registration and on agreements for sale had not come into force. The state rules had not been notified either. An agreement in the prescribed form could not have been signed at that stage. So the terms of the allotment letter were the ones to be kept in view, and the order calls that letter "the lone agreement between the parties". Measured from the allotment letter, the order says, there was "lesser delay than as alleged" by the allottee.

Why the deemed possession clause did not stop it

The allotment letter repeated the thirty day rule, under which possession would be deemed taken if the allottee did not take it. GMADA relied on that clause. The authority did not accept it as the end point. It held that the deeming clause "is not cogent enough to limit the delay period interest", and that interest had to run until possession was actually given.

For that date the order looked at the demarcation and marking certificate. The certificate recorded the on site marking of the plot and directed the allottee to fill the foundation as per the approved plan and get levels checked before building. GMADA had itself admitted in its reply that demarcation and possession were given on that day. The order therefore treated the date of the certificate as the date of handing over.

What the authority ordered

The order relies on section eighteen of the Act, which it reproduces. Its proviso reads: "Provided that where an allottee does not intend to withdraw from the project, he shall be paid, by the promoter, interest for every month of delay, till the handing over of the possession, at such rate as may be prescribed."

GMADA was directed to pay interest on the amount paid for the plot at the rate prescribed in rule sixteen of the Punjab rules, which is the State Bank of India's highest marginal cost of lending rate plus two per cent. The interest runs from the date of the allotment letter to the date of demarcation, a period of a little under eighteen months. No interest was awarded for the years between the letter of intent and the allotment letter.

Under rule seventeen, GMADA has ninety days from receiving the order to pay. It also has to file a compliance report with the authority. The order notes that a failure to comply may attract a penalty under section sixty three of the Act. The claim for litigation costs was not pressed at the hearing and was not decided.

On force majeure, the order records that delay caused by an amended environmental clearance "cannot be attributed to the complainant" and cannot be treated as force majeure. It describes that as a matter of judicial pronouncement.

What the order leaves open

This is a single order on one complaint, decided by one Member on its own papers. It does not bind other benches as settled law, and the Act allows an appeal to the Real Estate Appellate Tribunal.

The order runs interest from the date of the allotment letter itself. It does not discuss the thirty day window that the same letter gave the allottee to take possession. It also says nothing directly about the Covid period that GMADA raised.

The complaint sought interest only, so the order says nothing about compensation, which the Act treats as a separate claim. It also does not address any other allottee in Eco City Two.

Why it matters across GMADA schemes

Many GMADA schemes have moved buyers from a letter of intent to an allotment letter some years later. On the reasoning in this order, the date that counted was the allotment letter, because that was when a specific plot was allotted. The allottee's longer claim, measured from the letter of intent, did not succeed.

The order also shows the role of the demarcation certificate. It was that certificate, with GMADA's own admission, that fixed the end of the delay period, and the deeming clause in the allotment letter did not shorten it. Each case still turns on its own papers.

Related reading

- Punjab RERA to buyers: possession means interest and not compensation
- Builder delayed possession in Mohali: what RERA Punjab actually awards
- Eco City Two extension launch deferred: what is known so far
- Punjab RERA rules buyers cannot waive delayed possession compensation

Sources: Real Estate Regulatory Authority, Punjab, order under section thirty one in a complaint against the Greater Mohali Area Development Authority concerning a plot in Eco City Two, instituted on the sixth of May twenty twenty five and decided on the twenty eighth of October twenty twenty six by Member Binod Kumar Singh, published in the authority's list of orders and judgements. Real Estate Regulation and Development Act of twenty sixteen, sections two, eighteen, thirty one and sixty three. Punjab State Real Estate Regulation and Development Rules of twenty seventeen, rule sixteen on the interest rate and rule seventeen on the time to pay. The sources we use are listed on our Editorial Sources page.

This piece describes a published order of the authority. Nothing here is legal or property advice, and the position of any other allottee turns on the papers in that allottee's own case and on the authority's decisions.