When flat buyers stop getting their promised possession date, the developer is rarely the only name on the legal notice. Landowners who signed a joint development agreement years earlier, often in exchange for a fraction of the eventual project value, suddenly find themselves listed as co-respondents in a RERA complaint, a consumer forum case, or a civil suit for specific performance. The plot was theirs. The cement, the labour, and the missed deadlines were not.
This piece answers the question directly: if you handed over your land under a development agreement and the builder fell behind schedule, are you liable for that delay? The consistent answer from the Supreme Court down to the High Courts is no. The fuller answer is that this protection depends on how your agreement was actually drafted, and a number of landowners have lost it because their contract gave them a slice of control or a slice of profit they did not realise would cost them later.
How a Joint Development Agreement Splits the Risk
A joint development agreement, often called a JDA or a collaboration agreement, follows a recognisable pattern. The landowner contributes the plot. The builder contributes money, expertise, and labour, and takes on the job of obtaining sanctioned plans, NOCs, and approvals. Once construction is complete, the constructed area is split, typically by a percentage worked out at the time of signing, between the owner's share and the builder's share. The builder usually also takes a General Power of Attorney from the owner so that it can deal with regulatory authorities and, in many cases, sell its own share of flats without going back to the owner each time.
The Supreme Court examined this exact structure in Faqir Chand Gulati v. Uppal Agencies Pvt. Ltd., a case where a landowner alleged the builder had made unauthorised deviations during construction and sought relief under the Consumer Protection Act. The builder argued the arrangement was a joint venture, which would have meant the landowner could not be a "consumer" complaining against a "service provider." The Court rejected that framing[1].
"The land-holder will have no say or control in the construction. Nor will he have any say as to whom and at what cost the builder's share of apartments are to be dealt with or disposed of. His only right is to demand delivery of his share of constructed area in accordance with the specifications."
The Court went further and listed the contractual features that, in its view, ruled out a true joint venture in that case: the agreement expressly stated it did not create a partnership, the landowner was barred from interfering with construction, and the builder alone appointed contractors and architects and alone bore penalties for deviations[1]. A landowner who signs away control in this way is, in the Court's words, a consumer of the builder's services, not a partner responsible for how those services are performed. The corollary follows on its own: if the landowner cannot control construction, the landowner cannot be blamed when construction runs late.
When the Builder's Own Delay Becomes the Landowner's Shield
The clearest illustration of this principle in practice comes from a 2013 Madras High Court appeal involving a Coimbatore plot. The landowners had signed a joint venture and development agreement in March 2006, entitling the builder to 62% of the constructed area in exchange for building a residential complex within eighteen months of obtaining approvals. The builder obtained its No Objection Certificate in August 2008 but did not start the project. Years passed. The builder kept promising fresh start dates and, at one point, tried to fold in an adjoining property into the same development without the landowners' consent, a step that delayed approvals even further. By 2011, the landowners terminated the agreement and revoked the power of attorney.
The builder then sought, and initially got, an injunction from a trial court restraining the landowners from dealing with their own property pending arbitration. The High Court reversed that order[2]. The bench held that a party seeking the discretionary remedy of injunction must come with clean hands, and a builder who had sat on an approved project for years, then tried to expand its scope without consent, and was separately tangled in litigation with neighbouring owners, could not show the balance of convenience in its favour. The landowners' offer to simply refund the security deposit they had received was treated as proof that they were not trying to unjustly enrich themselves at the builder's expense; they wanted out of a stalled deal, nothing more.
The practical lesson for a landowner watching a project stall is that delay caused by the builder is not a neutral fact. It is evidence the landowner can use offensively, to terminate the agreement, resist an injunction, or recover the deposit, rather than a liability the landowner has to defend against.
RERA Changed the Stakes, But Not Who Counts as the Promoter
The Real Estate (Regulation and Development) Act, 2016 raised the cost of delay considerably. Where a promoter fails to give possession by the date stated in the agreement for sale, Section 18 entitles the allottee to either withdraw with a full refund plus interest, or stay in the project and claim interest for every month of delay[3]. The obligation under Section 18 runs against the "promoter," and the Bombay High Court has read that obligation strictly. In a 2023 appeal over a Panvel project, the developer argued it should be excused because government authorities took too long to clear approvals after the agreement was signed. The Court was unmoved[4].
"The allottee is not concerned with delay of the promoter in getting the approvals on time. If there is default by the promoter in giving possession as per the terms of the agreement, then he is mandatorily required to compensate the allottee."
That ruling matters here for a reason that has nothing to do with approvals. If a court will not let a developer offload its own delay onto a regulatory authority, it is even less likely to let that delay land on a landowner who has no role in construction at all. The real question, then, is whether the landowner counts as a "promoter" under Section 2(zk) of the Act in the first place, because Section 18 liability attaches only to promoters.
RERA itself anticipates that the person who builds and the person who owns the underlying land are often different people. The application form for project registration under Section 4 requires a promoter who is not the landowner to disclose "the consent of the owner of the land along with a copy of the collaboration agreement, development agreement, joint development agreement or any other agreement"[5]. The statute is built around the assumption that consenting to development is not the same thing as being the promoter who registers the project, takes the 70% escrow obligation, and answers to allottees.
The Allahabad High Court applied exactly this distinction in a 2024 dispute over a project called Green Reserve. A registered authority had objected to the project's registration on the ground that the landowning company should be added as a co-promoter. The Court disagreed, holding that the contractor who held a General Power of Attorney and the right to sell units fell squarely within the definition of promoter, and that the underlying landowner did not have to be dragged in merely because its land was being developed[6]. Several State RERA authorities have reached the same conclusion in their own orders. Fox & Mandal's review of these rulings notes that the Kerala High Court reached an identical position in late 2024, holding that a landowner who hands over operational control and has no role in marketing or sale of units is not a promoter, even though RERA's definition could, on a loose reading, be stretched to cover anyone connected to the land.
Landowners Can Be Complainants Too, Not Just Defendants
It is easy to assume RERA only protects flat buyers. A 2024 Patna High Court ruling makes clear that a landowner who hands over a plot in exchange for flats stands in much the same shoes as a buyer, and can use RERA against the builder rather than the other way round. In that case, the landowners had handed over land for a Tiruvantpuram City project on the understanding that the builder would deliver flats within two and a half years, with a six month grace period, failing which the builder would pay Rs. 8,000 per flat per month until possession. When the builder did not deliver, the landowners filed a complaint before the Real Estate Regulatory Authority, which directed the builder to hand over three flats[7].
The builder tried to argue that landowners simply could not bring a complaint under Section 31 of the Act at all, since that remedy was meant for allottees who buy flats, not owners who contribute land. The High Court rejected this, relying on a clarification issued by the Bihar Real Estate Regulatory Authority that a landowner under a development agreement is to be treated as an allottee, because the landowner is, in substance, getting apartments in exchange for the land rather than for cash[7]. The Court also rejected the argument that an arbitration clause in the development agreement ousted RERA's jurisdiction, noting that the statutory remedy exists independently of whatever dispute resolution clause the parties wrote into their contract years before the Act came into force. The combined effect of Faqir Chand Gulati and this ruling is that a landowner in a stalled JDA usually has two separate doors open, a civil suit for breach of the development agreement, and a RERA or consumer complaint, while having only one door that the builder can knock on in return, and that door requires proof the landowner actually controlled the construction.
The Catch: When Landowners Do Become Liable
None of this is an unconditional shield. The Supreme Court in Faqir Chand Gulati was careful to carve out an exception for what it called a true joint venture, where the landowner has a genuine say in construction, participates in management, and shares in the profit or loss of the venture rather than simply waiting for a fixed share of flats[1]. A landowner inside that kind of arrangement is, by the Court's own description, a co-adventurer responsible for the construction, not a consumer of it.
Several State RERA Authorities have built on exactly this idea, in a way that catches landowners who never thought of themselves as builders. MahaRERA, GoaRERA, and KarRERA have all issued circulars holding that where the developer agrees to share project revenue with the landowner, the landowner is treated as a co-promoter and becomes jointly liable for the same obligations as the developer, including the requirement to open a separate escrow account for 70% of sale proceeds from the landowner's own share of units. RajRERA has taken a more structured approach, listing five specific triggers, among them whether the landowner has any role as a builder or developer, whether the landowner has a share of the area earmarked for direct sale before project completion, and whether the landowner agreed to share profit or loss of the project. Argus Partners' detailed review of these circulars points out that this exposes a real shift in market practice. Landowners used to take a lump sum payment and walk away from a project entirely. Today, most landowners hold back a share of the constructed area to sell on their own, precisely the arrangement that several State Authorities now treat as converting them into promoters.
A separate line of risk involves refund obligations rather than delay compensation. Where allottees seek a refund under Section 18 and both the landowner and the developer have collected money or land value from the transaction, courts and RERA authorities have at times held both jointly liable to return what was taken, even when only the developer caused the actual delay, on the reasoning that joint promoters share joint liability for the same statutory obligation. Landowners who structured their JDA to receive direct payments from allottees for their own share of flats, rather than receiving everything through the developer, are the ones most exposed to this version of the risk.
What to Check in Your Development Agreement Right Now
If a project on your land has fallen behind schedule and you are worried about being pulled into the fallout, four documents will tell you almost everything a court would want to know about your exposure.
The RERA registration certificate for the project. Check who is listed as the promoter. If you are not named, that registration is strong documentary evidence the regulatory authority itself does not treat you as one.
The development agreement's clauses on control. Look specifically for language barring you from interfering with construction, and language giving the builder sole authority to appoint contractors, architects, and sub-contractors. The more one-sided this is in the builder's favour, the stronger your position under Faqir Chand Gulati.
Whether you receive a fixed share of constructed area for your own use or sale, or whether you are entitled to a percentage of project revenue. A revenue share is the single fact most likely to convert you into a co-promoter in Maharashtra, Goa, or Karnataka.
Whether you, personally or through an agent, have ever directly entered into an agreement for sale with a flat buyer, collected payment from a buyer, or signed marketing material for the project. Any one of these can be used to argue you stepped outside the role of a passive landowner.
If a Notice Has Already Landed on Your Doorstep
Do not assume the complaint will be dismissed against you simply because the case law is on your side. Procedurally, you still need to appear, file a reply, and place the right documents on record, the development agreement, the power of attorney, and the project's RERA registration showing the builder as the sole promoter. Where the complainants are flat buyers rather than RERA, and the forum is a consumer commission, the same documents support an application to be deleted as a party for want of privity of contract, since you never sold anything to that buyer and never promised them a possession date.
If the builder has separately stopped performing and you are the one losing patience, do not wait for the buyers to act first. Termination of the development agreement, recovery of any security deposit, and your own complaint against the builder, whether before RERA or a civil court, are all remedies the case law above shows landowners successfully pursuing. A landowner who moves first, with a documented record of the builder's specific defaults, tends to fare far better than one who only responds once dragged into someone else's dispute.
The Bottom Line for Landowners
The weight of judicial authority runs firmly in favour of landowners who hand over their plot and step back from construction. They are not joint venturers, they are not promoters under RERA, and a builder's own delay cannot become their burden to carry. That protection, however, is a function of the contract actually signed, not a status that attaches to anyone who happens to own the underlying land. A landowner who took a revenue share, kept a slice of saleable area, or signed agreements directly with buyers has, in the eyes of several RERA Authorities, walked across the line from owner to promoter. Reading your own development agreement with that line in mind, before a notice forces you to read it under pressure, is the difference between a five minute conversation with your lawyer and a multi-year proceeding you never expected to be part of.
Under the provisions of the Real Estate (Regulation and Development) Act, 2016 (“RERA”), read with the various clarifications and directions issued by different Real Estate Regulatory Authorities from time to time, it is well settled that where a real estate project is undertaken through a collaboration or development arrangement, both the landowner and the developer fall within the ambit of the term “Promoter”. Consequently, they are jointly liable for discharging the obligations, functions and responsibilities prescribed under the Act. Such liability is not confined only to the developer who obtains the requisite building permissions or undertakes the construction, but equally extends to the landowner, who is regarded as a promoter by virtue of the statutory definition under Section 2(zk) of the Act.
Therefore, the landowner cannot evade liability merely on the ground that the developer alone obtained the statutory approvals or executed the construction. In terms of the Real Estate (Regulation and Development) Act, 2016 and the consistent interpretation adopted by various Real Estate Regulatory Authorities, both the landowner and the developer are promoters and are jointly and severally responsible for complying with the obligations imposed under the Act, including those relating to the rights and claims of allottees.
However, in Srigansh Chandrasekaran & Ors. v. M/s Unishire Homes LLP & Ors. (2026 INSC 172), the Supreme Court reaffirmed an important principle in real estate jurisprudence — mere authorization by landowners to a developer under a JDA does not automatically fasten liability on them for delay in construction. This judgment reinforces that in JDA projects, liability follows contractual responsibility — landowners are not automatically exposed to claims for construction delay unless specific obligations or culpable conduct are demonstrated. So, it is very important that the JDAs are carefully drafted so that landowners are safe and not liable for any compensation to be paid to any homebuyer in case of any default.