CHANDIGARH, May 16 — The state government has formally repealed its decade-old real estate composition policy, replacing it with a aggressive fine structure designed to protect property buyers and enforce timely project documentation.
The newly implemented directive completely updates the penalty limits established under a previous 2013 policy, which capped maximum long-term delay penalties at nominal flat rates starting at ₹1 lakh per year. Under the new guidelines, even short-term defaults will result in immediate multi-lakh liabilities for corporate developers.
“The government has fixed penalties at ₹10 lakh for delays up to 60 days, ₹20 lakh for delays between 60 and 90 days, ₹30 lakh for delays up to 120 days, ₹40 lakh for delays up to 150 days, and ₹50 lakh for delays extending beyond 150 days up to 180 days,” the department directive stated.
According to reordered administrative guidelines, the policy change aims to eliminate chronic delays in executing the Apartment Ownership Act filings. Department officials stated that the previous system allowed builders to put off documentation for years with minimal financial consequences, a practice that delayed the transfer of common areas to resident associations.
To illustrate the transitional impact on active projects, the department stated that a developer who crossed their 90-day filing deadline in August 2025 and failed to resolve it until early 2026 would face a combined bill comprising nominal historical rates alongside a modern penalty exceeding ₹30 lakh.
The regulation further clarifies that the state will take a firm position on collection, classifying any unpaid real estate penalties as public land revenue debts to facilitate immediate asset attachment if developers fail to comply with the revised timelines.
