The Maharashtra Real Estate Regulatory Authority (MahaRERA) recently clarified a critical issue for homebuyers and builders in a judgment that could reshape how occupation certificates (OCs) are treated in Mumbai and across the state. On November 20, 2025, in case CC006000000591010, MahaRERA stated that a conditional occupation certificate issued by a builder cannot be treated as a final and complete OC unless all stipulated conditions are fulfilled. This decision carries significant implications for homebuyers, builders, and the real estate market.
In the case at hand, the complainant submitted an occupation certificate dated March 4, 2022, issued by the Slum Rehabilitation Authority. However, MahaRERA noted that this OC was conditional, subject to compliance with pending stipulations under the letter of intent, the intimation of approval, and Section 270A of the Mumbai Municipal Corporation Act, 1888, which relates to certification of adequate water supply. Since these conditions were not met, the OC could not be considered final.
- Builders’ Liability to Pay Interest Compensation
One of the key takeaways from the ruling is that builders are liable to pay interest compensation to homebuyers if the full, final OC is not offered within the stipulated timeline. In practical terms, this means that possession cannot be legally handed over to buyers based on a conditional OC alone. Any delay in issuing a full OC, which is often a requirement for registration of ownership or obtaining a home loan, exposes builders to financial penalties.
For homebuyers, this is a safeguard against being pushed into occupying units that are not fully compliant with municipal requirements. The interest compensation mechanism ensures that builders bear the financial consequences of any delays caused by incomplete approvals. It effectively puts the onus on developers to ensure that all necessary conditions are met before promising possession.
- Implications for Homebuyers
For homebuyers, this judgment is a significant protection. Many buyers, especially in Mumbai’s rehabilitation or high-demand projects, often receive conditional OCs and assume that possession is legally secure. MahaRERA’s clarification makes it clear that accepting possession on the basis of a conditional OC can be risky.
Buyers should carefully check whether an OC is conditional or final before moving in. A conditional OC may still have pending stipulations regarding water supply, structural compliance, or municipal approvals. Accepting possession prematurely could mean facing legal complications, incomplete amenities, or issues with registration. Moreover, buyers now have the legal backing to claim interest or compensation if the builder delays issuing the full OC.
In essence, the judgment empowers homebuyers to demand accountability and ensures that possession is linked to compliance, not just paperwork. Homeowners can also use this ruling to negotiate with builders, seek interest compensation, or take recourse through MahaRERA if deadlines are not met.
- Builders’ Steps After Getting OC
For developers, the MahaRERA verdict underscores the need for caution and diligence. Once a conditional OC is received, builders must ensure all pending conditions are fulfilled before handing over possession. This includes:
- Ensuring compliance with municipal stipulations such as water supply certification, structural safety requirements, and other local approvals.
- Regularly updating buyers about the status of pending conditions and timelines for fulfillment.
- Coordinating with local authorities to expedite approvals and ensure that no condition remains unaddressed.
- Documenting compliance rigorously to avoid disputes later, as MahaRERA or courts may scrutinize every step.
Additionally, builders should be prepared to compensate buyers if delays occur. Clear communication and adherence to timelines not only avoid legal complications but also build trust in an increasingly vigilant real estate market.
The MahaRERA judgment sends a clear message: a conditional OC is not possession-ready, and both builders and buyers must navigate this distinction carefully. For buyers, it is a chance to assert their rights and ensure they occupy legally compliant homes. For builders, it is a reminder to fulfill all obligations before promising possession or facing financial penalties. In a market where delays and incomplete approvals are common, this ruling reinforces accountability, transparency, and fairness, making it a landmark directive for Maharashtra’s real estate landscape.
