By Arosh John, Founder, John Real Estate (MahaRERA Reg. No. A51700001835) | Editor-in-Chief, Thane Real Estate News (TREN)
MMR | January 2026
The Booking-Stage Dispute That Keeps Repeating in Mumbai–Thane
A buyer pays a booking amount and signs a booking form. Before a registered Agreement for Sale is executed, the buyer seeks to cancel the booking. The promoter responds with a familiar position: the booking is “non-refundable,” and the buyer will be issued a credit note for another unit or project, rather than an actual refund.
This scenario is increasingly common across new launches, plotted developments, villas, and premium residential projects. In many cases, booking money is treated as a lock-in mechanism, while formal documentation trails behind payment collection.
This article explains how such disputes are typically viewed under MahaRERA’s compliance framework, the difficulties promoters face in defending their positions, and how buyers should structure their response in a disciplined, document-driven manner.
Booking Form vs Registered Agreement for Sale
RERA places clear emphasis on the registered Agreement for Sale. It is not a procedural formality; it is the document that crystallises contractual rights, obligations, timelines, and remedies.
At the booking stage, many transactions remain incomplete from a statutory perspective:
- Consideration has been paid
- A booking form is signed
- Sales commitments are recorded informally
- But the registered Agreement for Sale is not executed
In this interim phase, promoters face greater scrutiny when they:
- Delay execution of the Agreement for Sale while holding buyer funds, or
- Rely on brief “non-refundable” language in a booking form to justify full forfeiture
From a compliance standpoint, the absence of a registered Agreement for Sale materially weakens an aggressive forfeiture position, particularly where the booking form does not clearly quantify deductions or explain cancellation consequences.
Credit Note vs Refund
A credit note and a refund are not interchangeable.
A credit note is an internal accounting adjustment that keeps the buyer’s money with the promoter. A refund is the return of funds to the buyer’s bank account.
While promoters may offer a credit note as a commercial option, difficulties arise when it is presented as the only outcome. In such situations, the substance of the transaction matters more than the terminology used. If money is retained indefinitely and tied to future purchases, the arrangement increasingly resembles forced reinvestment rather than settlement.
In booking-stage disputes, buyers are generally on firmer ground when they:
- Treat credit notes as optional, not mandatory, and
- Clearly communicate that a refund is the primary relief sought
“Non-Refundable Booking Amount” Is Not an Absolute Shield
Most booking forms contain a clause stating that the booking amount is non-refundable. That clause alone rarely ends the discussion.
What typically comes under examination is:
- Whether the booking form constitutes a concluded contract capable of supporting forfeiture
- Whether the forfeiture claimed is proportionate or punitive
- Whether the promoter acted transparently and within reasonable timelines
- Whether the unit remains marketable or is resold while the buyer’s funds are retained
Where promoters seek to forfeit the entire booking amount without a registered Agreement for Sale, and without demonstrating a rational basis for deductions, the position becomes difficult to sustain when formally challenged.
How MahaRERA Typically Views Booking-Stage Forfeiture
One factor consistently influencing outcomes is whether the Agreement for Sale has been registered.
In cases where no registered Agreement for Sale exists, MahaRERA has generally adopted a restrained approach to forfeiture. While each matter turns on its facts, the Authority has often been reluctant to uphold large or punitive deductions at the booking stage.
In practice, this has commonly translated into:
- A nominal administrative deduction, often a small percentage of the booking amount, or
- A flat processing charge justified as documentation or administrative cost
with the balance refunded to the buyer.
This approach reflects a broader regulatory intent: booking money is not meant to operate as a penalty mechanism when the statutory contracting milestone has not been completed.
A Common Mistake That Weakens Strong Refund Claims
There is one recurring misstep that significantly undermines otherwise sound refund positions.
If a buyer voluntarily signs a letter or email accepting a credit note, the transaction is often treated as settled by consent. At that point, the dispute shifts from refund entitlement to commercial adjustment accepted, making subsequent demands for a cash refund substantially harder to pursue.
For this reason:
- Buyers should avoid signing any document that records acceptance of a credit note unless they genuinely intend to reinvest, and
- All cancellation communication should clearly state that a refund is sought, and that any credit note is not accepted unless expressly chosen later
Once consent is documented, reversing that position becomes legally and practically challenging.
A Clean Buyer Playbook
1. Cancel in writing with clarity
Issue a formal cancellation communication setting out:
- Project and unit details
- Payment particulars
- Confirmation that the registered Agreement for Sale has not been executed (if applicable)
- A clear refund request with a defined timeline
- Rejection of a credit note unless voluntarily opted for
2. Demand clause-based justification
Ask the promoter to identify:
- The specific clause relied upon for forfeiture, and
- The basis for refusing a refund
Responses based on “company policy” should be preserved but treated cautiously.
3. Preserve records
Maintain an organised record of:
- Booking form and receipts
- Cost sheets and annexures
- Correspondence and payment schedules
- Any sales representations or assurances
Documentation quality often dictates speed and outcome.
4. Escalate where required
If a refund is refused or replaced with a credit note, escalation through MahaRERA typically focuses on:
- Refund of amounts paid (subject to reasonable deductions, if applicable), and
- Directions against unfair retention
Once a matter becomes record-based, negotiation dynamics often shift.
Practical Settlement Structure for Faster Closure
Where buyers prefer commercial resolution without prolonged proceedings, a balanced settlement structure generally includes:
- Refund by bank transfer within a defined period
- Acceptance of only reasonable, documented administrative deductions
- Credit note only if the buyer expressly opts for it
This preserves flexibility without surrendering legal position.
Bottom Line for Mumbai–Thane Buyers
Booking-stage cancellations require discipline, not confrontation. Clear written cancellation, refusal to accept forced credit notes, and insistence on clause-based justification place buyers in a strong position.
Promoters may negotiate commercial terms. They cannot convert refunds into mandatory store credit without the buyer’s consent.
Also READ: Booking Cancellation in Under-Construction MahaRERA Projects: What Every Buyer Should Know
Also READ: MahaRERA’s Latest Refund Order: 5 Lessons for Mumbai–Thane Homebuyers and Developers
About the Author
Arosh John is the Founder of John Real Estate (MahaRERA Reg. No. A51700001835) and Editor-in-Chief of Thane Real Estate News (TREN). With over a decade of on-ground experience, he is recognised as a Thane real estate expert, advising buyers and investors on premium resale apartments, luxury villas, plotted developments, and second-home investments across Thane and the wider MMR. His work focuses on MahaRERA-aligned due diligence, transaction structuring, and risk-led advisory, helping clients make informed, compliance-driven property decisions.
Disclaimer
This article is for general informational purposes only and does not constitute legal advice. Real-estate disputes are fact-specific and document-driven. Readers should obtain project-specific professional advice before initiating any action under RERA or MahaRERA.
