Karnataka HC Caps COVID Force Majeure Delays for Possession at 18 Months

Facts

A Bengaluru-based developer cited the COVID-19 pandemic as a force majeure event to justify a significant delay in handing over possession of apartments to a homebuyer. The builder argued that lockdowns and supply chain disruptions made it impossible to meet the original deadlines agreed upon in the sale agreement. The aggrieved homebuyer filed a writ petition in the Karnataka High Court, challenging the indefinite nature of this delay.

Holding

The High Court rejected the developer's argument. It held that the force majeure defence, while applicable to the initial phase of the pandemic, could not be invoked indefinitely. The court established an outer limit of 18 months from the original government-notified lockdown as the maximum permissible delay attributable to the pandemic.

Reasoning

The court acknowledged that force majeure is a valid principle under the Indian Contract Act, 1872, excusing parties from performance due to unforeseen events. However, it clarified that this relief is not perpetual. The court determined that a period of 18 months was a reasonable timeframe for a prudent developer to overcome pandemic-related challenges, remobilize labour, and resume construction. Allowing an open-ended delay would unfairly prejudice homebuyers who continue to bear financial burdens. The judgment balances the genuine operational hurdles faced by builders with the fundamental right of a buyer to receive their property within a reasonable timeframe.

Practical impact

This ruling provides a significant safeguard for homebuyers in Karnataka, preventing developers from using the pandemic as an open-ended excuse for project delays. It creates a clear timeline, empowering buyers to legally challenge delays extending beyond this 18-month force majeure period. Affected buyers can now more confidently approach regulatory authorities to claim interest for the delay or seek a full refund under the Real Estate (Regulation and Development) Act, 2016 (RERA).

Sources

• Karnataka HC WP 8845/2025
• Indian Contract Act, 1872
• Real Estate (Regulation and Development) Act, 2016