Can a Builder Forfeit Your
Booking Amount?
MahaRERA Says No.
A real Mumbai homebuyer case where ₹24.33 lakh was ordered refunded — and what it means for your rights under RERA 2016.
If you are seeking a booking amount refund under RERA after cancelling a flat — you have the law firmly on your side. A January 2026 MahaRERA order makes it very clear: builders cannot keep your booking amount, no matter what clause they buried in the application form.
In fact, this exact situation played out in a real Mumbai complaint. A family paid ₹27.10 lakh as a booking amount, discovered serious false claims in the draft Agreement for Sale, cancelled within 75 days, and asked for a refund. However, the builder refused, citing a forfeiture clause. As a result, MahaRERA ordered the RERA booking amount refund — plus interest.
So, at Ghar Insight, our mission is to give you — the buyer — the information edge you deserve. Let’s break this case and your rights down step by step.
What Led to This Booking Amount Refund Under RERA? The Full Story
A Mumbai family booked a flat in a large under-construction project for a total price of about ₹2.73 crore. Before they had even seen the draft Agreement for Sale (AFS), the builder asked for 10% of the total amount upfront — collecting the booking amount without following RERA’s required rules.
So they paid — a total of ₹27.10 lakh including GST — across two payments in July and August 2019. Only after the money was collected did the builder share the draft AFS. What they read shocked them.
⚠️ Why These Buyers Were Right to Demand a Booking Amount Refund Under RERA
- Land sold as freehold was actually partly leasehold — with no details about the lease period given to buyers
- Project size was misrepresented: a small 6-building complex was promised, but the AFS showed a 22-acre multi-phase development
- Furthermore, amenities for the buyers’ phase were tied to the completion of all future phases — never told to buyers upfront
- In addition, the location of the EWS wing was hidden from buyers at the time of booking
- Payment schedules were different between the booking form and the AFS
- Finally, one-sided forfeiture clauses were in the booking form — which was never uploaded on the MahaRERA portal
As a result, the family raised all these concerns in writing and met the builder’s senior team. They received verbal promises — but no written corrections. Therefore, they cancelled the booking within 75 days and asked for their money back.
The builder accepted the cancellation. However, he refused the refund, citing a forfeiture clause in the booking form. So the homebuyers approached MahaRERA — and won.
The MahaRERA Ruling: Booking Amount Refund Under RERA Is Your Right
First, MahaRERA looked at a ruling by the Appellate Tribunal and agreed with its findings:
“There is no express provision in the RERA Act, 2016 by which the promoter is entitled to forfeit earnest amount or part thereof in the event of cancellation of booking by the allottee. Allottees are entitled to refund of the entire amount with interest.”
Moreover, the Authority noted that RERA is a law built to protect buyers. Therefore, any clause that allows forfeiture goes directly against what the law is trying to do. As a result, every homebuyer’s RERA booking amount refund on cancellation must be paid in full.
How Builders Block Booking Amount Refund RERA Claims — and Why They Fail
In this case, the builder raised several objections to the RERA booking amount refund demand. Here’s what was argued and why MahaRERA rejected each one:
🔴 Arguments About the Contract
| ❌ Builder’s Argument | ✔ MahaRERA’s Verdict |
|---|---|
| The booking form has a signed forfeiture clause. | No private contract can overrule RERA. Forfeiture is simply not allowed under the Act. |
| Buyers broke Section 13 by refusing to sign the AFS. | Buyers cancelled before any AFS was signed. The builder’s own false claims led to the cancellation. |
| This is purely a private contract dispute. | MahaRERA has full power to decide cases of false claims made at the time of booking under Section 12. |
🔴 Arguments About Procedure and Losses
| ❌ Builder’s Argument | ✔ MahaRERA’s Verdict |
|---|---|
| The flat was blocked for years, causing financial losses. | In fact, the builder had already sold the flat to someone else during the case — making this claim false. |
| One family member has no right to file — not a signatory. | This was fixed by adding the member as a co-complainant with a supporting letter and affidavit. |
| A refund is only possible under Sections 12, 14, or 18. | The Appellate Tribunal’s ruling overrules this narrow reading. RERA’s main purpose is to protect buyers. |
6 Things to Know Before Claiming a Booking Amount Refund Under RERA
Whether you’re buying in Borivali, Thane, Navi Mumbai, or anywhere in Maharashtra — understanding your booking amount refund RERA rights before you book is your strongest protection. Below are the six key lessons from this case.
Section 13 RERA: The Rule Behind Your Booking Amount Refund Right
Under Section 13 of RERA, a builder cannot collect more than 10% before signing a registered Agreement for Sale. In this case, over ₹27L was collected before any AFS was in place. As a result, the RERA booking amount refund became a legal requirement.
GST Is Not Refundable — Know What You Can and Cannot Get Back
For example, in this case, the order gave back only ₹24,33,560 (the flat price), but not the ₹2,76,568 paid as GST. That is because GST goes to the government. So the builder cannot return it to you.
Always Verify Land Type — Freehold vs Leasehold — on MahaRERA
In this case, the builder sold the flat as freehold land when leasehold land was also involved. This is important because it affects your ownership, title, and your ability to resell in the future.
Phased Development Must Be Told to You Upfront
In this case, buyers were told they were buying in a small 6-building project. However, the AFS showed a 22-acre multi-phase plan where amenities were tied to all future phases being built. This is a false claim under Section 12 of RERA.
Documents Not on MahaRERA Portal Cannot Be Used Against You
In this case, the booking form was never put on the MahaRERA portal — a breach of Section 4. Because of this, the Appellate Tribunal has said such documents cannot be used to hold buyers to their terms.
Always Cancel in Writing and Keep Your Email Trail
The homebuyers in this case cancelled via email and a formal letter, and gave clear reasons. As a result, this paper trail was key to proving the timeline and showing that the builder had not refunded within 2 months.
Booking Amount Refund Under RERA: How Interest Is Calculated
When MahaRERA orders a booking amount refund under RERA, interest is added as per Rule 18 of the Maharashtra Real Estate Rules, 2017:
For example: If a builder accepts cancellation on 18 October, interest starts from 19 December — and continues until the full amount is paid back.
Avoid Ever Needing a Booking Amount Refund Under RERA — Pre-Booking Checklist
The best approach is never needing to claim a RERA booking amount refund at all. So before paying even a token amount to any builder in Maharashtra, run through this list:
✅ Check the Project and Land First
- Project is registered on MahaRERA with an Active status — not Lapsed or Revoked
- Land type is clearly told to you — freehold or leasehold, and if leasehold, the lease period is shared
- Title report, encumbrance certificate, and Commencement Certificate (CC) are uploaded on MahaRERA
- Draft Agreement for Sale is shared and read by you before paying more than a token amount
- No more than 10% is collected before a registered AFS is signed (Section 13 of RERA)
- Phased development details and dates for amenity delivery are given to you in writing
✅ Then Check the Documents and Builder
- EWS wing location is shown on the layout plan on MahaRERA
- Booking form and draft AFS are both uploaded on the MahaRERA portal
- Builder’s complaint record on MahaRERA has been checked by you
- All verbal promises from the sales team are confirmed in writing by the builder
- A formal allotment letter is given after booking (required under RERA)
- All payment receipts, emails, and messages are saved and backed up safely
Booking Amount Refund Under RERA Is Your Right — Use It
For a long time, the real estate sector in India has worked on an information gap — builders knew everything, while buyers knew only what they were told in a sales office. RERA was made to close that gap. Moreover, cases like this one show that the law works when buyers stand up for their right to a RERA booking amount refund.
🏆 Three Big Lessons from This Case
- First, you don’t need project delays to seek a refund. False claims made at the booking stage — even before an AFS is signed — are enough grounds under RERA.
- Second, a signed booking form cannot overrule RERA. Builders who use forfeiture clauses as threats are bluffing. The Appellate Tribunal has been very clear on this.
- Third, being honest in legal proceedings matters. A builder who falsely says a flat is “blocked” when it was already sold to another buyer faces a big loss of trust in the case.
In conclusion, the homebuyers in this case got justice — but it took years of effort. Therefore, the best protection is knowledge before you book, not a legal fight afterwards. That is exactly what Ghar Insight is here for — helping you understand your booking amount refund RERA rights before you sign a single document.
Booking Amount Refund RERA — Frequently Asked Questions
More Questions About RERA Booking Amount Refund
Disclaimer: This blog is for informational purposes only, based on a publicly available MahaRERA order dated January 2026. It does not constitute legal advice. Individual case outcomes depend on specific facts and circumstances. Please consult a qualified legal professional for advice specific to your situation. Ghar Insight is a business of Addhyamay Proptech LLP | MahaRERA Reg. No: A061182503540 | Udyam Reg. No: UDYAM-MH-18-0492131.
