CA K Sanjay BhargavChartered Accountant
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When a Karnataka project runs late: extension of registration, lapse, and interest to allottees

CA K Sanjay Bhargav, Chartered Accountant, Bengaluru

Membership No. 250054 · DISA (ICAI)

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Short answer: a K-RERA registration is valid until the completion date the promoter declared. It can be extended under section 6 of the RERA Act — for force majeure, or in reasonable circumstances without default by the promoter — but only up to one year in aggregate. The application goes in within three months before expiry, with half the registration fee (waived for force majeure) under Rule 7 of the Karnataka Rules. Separately, K-RERA's order of 10 August 2026 extended by four months every project whose completion date falls on or after 28 February 2026. None of this moves the possession date owed to buyers: delay interest under section 18 runs at SBI's highest MCLR plus 2% (Rule 16) — 10.80% on current rates.

This note is written for promoters. Where it describes allottees' rights, it does so to explain the promoter's exposure.

Two dates that are easily confused

Every Karnataka project carries two completion dates, and they answer to different provisions.

DateWhere it comes fromWhat governs itWhat extending it does
Registration validityThe completion period declared under section 4(2)(l)(C)Sections 5, 6 and 7 — the AuthorityKeeps the project's registration with the Authority in force
Possession dateThe agreement for sale with each allotteeSection 18 — the promoter's liability to the allotteeNothing, unless the allottee agrees

A promoter who secures an extension of registration has fixed the regulatory problem, not the contractual one. Interest to allottees keeps accruing from the possession date in each agreement.

Extending registration under section 6

Section 6 allows the Authority to extend a registration on the promoter's application due to force majeure, which the Act defines narrowly: war, flood, drought, fire, cyclone, earthquake or any other calamity caused by nature affecting the regular development of the project. Its first proviso is wider: in reasonable circumstances, without default on the part of the promoter, the Authority may extend for such time as it considers necessary, recording its reasons, not exceeding one year in aggregate. The second proviso says no application may be rejected without a hearing.

Funding shortfalls, contractor disputes and slow sales are not force majeure. Delays in approvals from other authorities are argued under the "without default" proviso, and the promoter has to show the delay was not of its own making.

Rule 7 of the Karnataka Rules sets the procedure:

PointRule 7
FormForm 'E' (now filed online through Apply for Extension on the K-RERA site)
WhenWithin three months before the registration expires
FeeHalf the registration fee under rule 3(3) — no fee where the extension is sought for force majeure
With itAn explanatory note on the reasons for delay and the need for extension, with supporting documents
LimitNot beyond the period allowed under the relevant State Act for completing the project or phase
OutcomeGranted in Form 'F'; rejected in Form 'D'

The registration fee itself is calculated per square metre of land under rule 3(3), with a cap that depends on the project type, so the extension fee is known in advance.

What the portal asks for

K-RERA's extension checklist lists 32 fields. The substantive ones:

  • the old and proposed new completion dates, and whether the plan has been renewed (with the renewed plan);
  • a current photograph of the project and the reason for delay from a dropdown, with supporting documents;
  • architect's and engineer's certificates on work completed to date and work pending, and CA certificates on funds utilised and funds required to complete (Form-Ex1 to Ex6 on the downloads page; the 2022 Regulations call the same certificates Form-F1 to F3);
  • the Form 'B' affidavit and an extension affidavit;
  • optionally, written consent from two-thirds of allottees and details of compensation paid to buyers;
  • sold and unsold unit details in K-RERA's spreadsheet format;
  • expired and renewed NOCs;
  • the fee (50% of the registration fee) and the payment receipt.

Blanket extensions K-RERA has granted

Not every extension needs an application. K-RERA has twice extended all projects at once.

OrderTriggerProjects coveredExtension
Circular of 19 May 2020 and notification of 18 December 2020COVID-19, first waveCompletion date on or after 15 March 2020Six months, then a further three — recorded by K-RERA as nine months in total
Notification of 27 August 2021 (in Kannada)COVID-19, second waveCases falling due on or after 1 April 2021Time extended to 1 October 2021
Order K RERA/ADMIN/10/2026, 10 August 2026West Asia situation, treated as "war" on MoHUA's advisory of 31 July 2026Completion date on or after 28 February 2026; projects registered on or after 1 August 2026 excludedFour months, no application and no fee

The 2026 order is made under section 6 read with section 7(3). It extends the registration and the completion timeline. It says nothing about agreements for sale or about interest to allottees, and it should not be read as a moratorium on either. The order also does not say whether the four months count towards the one-year ceiling in section 6; promoters close to that ceiling should not assume they do not.

Beyond one year: section 7(3)

Where a project still is not finished after section 6 is exhausted, the Authority's remaining option short of revocation is section 7(3): it may permit the registration to remain in force subject to conditions it imposes in the allottees' interest, and those conditions bind the promoter. K-RERA's order of 31 January 2023 (No. RERA/Finance/CR-150/2022-23) treats this as a fresh application with half the registration fee. Whatever conditions are imposed, quarterly updates continue throughout (see the quarterly update note).

Revocation and lapse

Revocation (section 7). The Authority may revoke on a complaint, on its own or on the competent authority's recommendation, where the promoter defaults on anything required by the Act, rules or regulations, violates the terms of an approval, engages in unfair practice, or indulges in fraudulent practice. It must give at least thirty days' written notice and consider the promoter's response. On revocation it debars the promoter from the project's web page, lists the promoter as a defaulter with a photograph, informs other states' authorities, and directs the bank to freeze the RERA account (released later only to fund the remaining work — see the designated account note).

Lapse and revocation (section 8). When a registration lapses without extension, or is revoked, the Authority may consult the State Government and act as it thinks fit — including having the remaining development work carried out by the competent authority, by the association of allottees, or in any other manner. On revocation, the association of allottees has the first right of refusal to complete the work. No direction under section 8 takes effect until the appeal period has run.

The practical point for a promoter is that lapse is not a quiet state. It invites exactly the intervention that section 8 describes, and it weakens any later application because the promoter was out of registration while the project was unfinished.

Interest to allottees for delay

Section 18(1) makes the promoter liable where it fails to complete, or cannot give possession, by the date in the agreement for sale, or because its registration is suspended or revoked:

  • If the allottee withdraws: refund of everything received for the unit, with interest at the prescribed rate, plus compensation. Interest runs from the date the promoter received each amount until it is refunded (section 2(za), Explanation (ii)). Rule 17 requires the refund within sixty days of it falling due.
  • If the allottee stays: interest for every month of delay until possession is handed over, at the same prescribed rate.

The Karnataka rate. Rule 16: the State Bank of India's highest marginal cost of funds based lending rate plus two percent. SBI's highest MCLR is its three-year rate, 8.80% from 15 September 2026, which gives 10.80% a year. Because MCLR moves, the rate is not fixed for the life of a project; the Authority's order states the rate it has applied.

An illustration. An allottee has paid ₹80 lakh and possession is ten months late. At 10.80%, simple interest is about ₹72,000 a month, or about ₹7.2 lakh for the ten months. Across a tower of 200 units, a year's delay is a material number that belongs in the project's cost-to-complete, not a contingency note.

Force majeure does not answer a refund claim. In Newtech Promoters and Developers Pvt Ltd v State of UP (Civil Appeals 6745–6757 of 2021, decided 11 November 2021), the Supreme Court held that the allottee's right to a refund with interest under section 18(1)(a) is unconditional where possession is not given as agreed, regardless of unforeseen events or stay orders not attributable to the allottee. The Authority orders the refund and interest; compensation is decided separately by the adjudicating officer under section 71.

The same rate runs the other way

Section 19(7) makes an allottee who pays late liable for interest at the prescribed rate, and the Act's definition of interest (section 2(za), Explanation (i)) requires that rate to equal the rate the promoter pays in default. In Karnataka that is Rule 16's SBI MCLR plus 2% in both directions. Agreements that charge buyers 18% or 24% on late instalments while paying the Rule 16 rate for delay are inconsistent with the Act; section 19(8) allows the promoter and allottee to agree to reduce the allottee's interest, not to raise it. Clause-level review of this is part of reviewing a JDA and sale documentation.

Presenting a delay case to the Authority

An extension application, or a defence to a delay complaint, is decided on the record. The strongest files share the same features:

  1. File early. Rule 7 wants the application within three months before expiry. An application after lapse starts from a worse position.
  2. Be current on quarterly updates and Form-7. A promoter asking for time with missing quarterly updates or an unfiled annual audit report is asking the Authority to overlook one default to cure another.
  3. Put the delay in a dated chronology — each event, its documentary evidence (government orders, approval applications and their dates, correspondence), and the days lost to it. Separate delays outside the promoter's control from those within it; the Authority will.
  4. Show the money. CA certificates on funds used and funds required, reconciled to the RERA account and the latest Form-4, and a credible funding plan for the balance.
  5. Show the work. Architect's and engineer's certificates on completed and pending work, with a realistic revised schedule and photographs.
  6. Deal with the buyers. Two-thirds allottee consent and any compensation already paid are optional fields on the portal, but they answer the question the Authority is really asking — whether the allottees are protected.
  7. Ask for time you can meet. A revised date missed again leads to section 7(3) conditions or revocation.

The RERA compliance calendar for Karnataka promoters shows where the extension window sits against the quarterly and annual filings, and the certificates themselves are covered on the RERA compliance and certification page.


This note summarises sections 2(za), 6, 7, 8, 18 and 19 of the Real Estate (Regulation and Development) Act 2016, Rules 7, 16 and 17 of the Karnataka Real Estate (Regulation and Development) Rules 2017, and K-RERA orders and circulars published on the K-RERA website as at 29 September 2026. It is written for promoters and is not advice to any allottee or on any particular project. Confirm the current K-RERA orders, the fee shown on the portal and SBI's MCLR on the relevant date before relying on any figure here; delay claims turn on the terms of each agreement for sale.

Frequently asked questions

How long can K-RERA extend a project's registration under section 6?

Section 6 allows extension on the promoter's application due to force majeure, and its proviso allows the Authority, in reasonable circumstances without default by the promoter, to extend for such time as it considers necessary — but not more than one year in aggregate. Beyond that, the Authority has used section 7(3), which lets it keep a registration in force on conditions instead of revoking it. K-RERA's order of 31 January 2023 prices that route at a fresh application with half the registration fee.

What is the four-month extension K-RERA granted in August 2026?

By Order No. K RERA/ADMIN/10/2026 dated 10 August 2026, following a Ministry of Housing and Urban Affairs advisory of 31 July 2026 that treats the West Asia situation as 'war' for force majeure purposes, K-RERA extended by four months the registration and completion timeline of every registered project whose completion date falls on or after 28 February 2026. No application or fee is needed for those four months. Projects registered on or after 1 August 2026 are excluded.

What rate of interest does a Karnataka promoter pay allottees for delay?

Rule 16 of the Karnataka Real Estate (Regulation and Development) Rules 2017 fixes it at the State Bank of India's highest marginal cost of funds based lending rate (MCLR) plus two percent. SBI's highest MCLR, the three-year rate, is 8.80% from 15 September 2026, which puts the Rule 16 rate at 10.80% a year. The same rule sets the rate allottees pay for late instalments, because the Act requires the two to be equal.

Does an extension of registration stop delay interest to allottees?

Not by itself. Section 18 ties the promoter's liability to the possession date in the agreement for sale, while section 6 extends the registration with the Authority. They are different dates. The August 2026 order says nothing about agreements or interest. The Supreme Court held in Newtech Promoters (11 November 2021) that the allottee's right to a refund with interest on delay applies regardless of unforeseen events not attributable to the allottee.

What happens if the registration lapses and no extension is granted?

Section 8 applies. On lapse or revocation, the Authority may consult the State Government and take such action as it thinks fit, including having the remaining development work carried out by the competent authority, by the association of allottees or in any other manner. On revocation, the allottees' association has the first right of refusal to finish the work. The RERA bank account can be frozen and released only to fund the remaining development.

Can a promoter charge allottees interest for late payment?

Yes, under section 19(7), at the rate prescribed — in Karnataka the same SBI highest MCLR plus 2% under Rule 16. The Act's definition of interest in section 2(za) requires the rate a promoter charges an allottee in default to equal the rate the promoter pays an allottee in default. An agreement that charges buyers 18% while paying them a lower rate for delay is out of line with the Act. Section 19(8) lets the two parties agree to reduce the allottee's interest.

Is your project's registration about to run out?

Send the registration certificate, the declared and revised completion dates, the last four quarterly updates and the RERA account statements. The extension route, the certificates needed and the interest exposure are worked out before anything is filed — on WhatsApp or by email.

Related service: RERA Certification & Filings