A turning point in the life of a middle-class household is the opportunity to buy a house. When Varun moved into his own house in Delhi, he was going through this memorable experience. The excitement of owning a 2BHK flat in the capital city was at an all-time high. He and his wife could not imagine the trouble they were about to go through soon. The first installment of problems came in the form of refusal of civic amenities. The justification given for this was the unavailability of occupancy certificate (OC) which the builder was careless enough to ignore. The buyers believed that they could live happily ever after in their new home with just the possession letter.

The case of Varun and his wife is not an isolated one bearing the brunt of such issues after moving into a new flat. A large number of homebuyers, especially those who are newbies trying to fulfil their dream of owning a home, are oblivious of the paperwork involved through the process of purchasing a house. Repeated postponement of delivery date by developers is an additional cause that flat owners overlook together with crucial documentation. Their priorities are completely focused on getting possession and shifting into the new home.

Another ‘must-have’ credential for every homebuyer is the occupancy certificate, which ideally should be taken into possession along with the new flat. Generally, there is a lot of confusion in differentiating between occupancy certificate and possession letter as both of them are considered synonymous. Enumerated below are the points that emphasize the gravity of both these papers:

Possession Letter

A possession letter is issued by the builder and is addressed to the buyer, citing the proposed completion date of the property. However, a possession letter without an OC or occupancy certificate does not legally suffice to make the possessor the owner of a property in India. Without the occupancy letter, house owners do not have all legal rights over their units and neither can they avail the amenities provided by the residential complex.

Moreover, without this letter it is not possible to apply for a home loan. When a property is being resold, banks and financial institutions verify the possession letter prior to passing the loan for the buyer.

Conditional Possession

There are cases where the buyers are left with no choice but to accept possession of the house even though they are not content with the construction or with the quality of materials used that does not match with what was promised, repairs not carried out or absence of completion certificate. However, in such cases the homebuyers can accept a conditional possession and they can write their disagreements on the developer’s copy. The respective conditions that have not been met by the developer can be mentioned on his copy and referring to them, the buyer can justify his decision to take a conditional possession. The buyer always has the right to ask the builder to fulfil the conditions failing which he can move the courts against the builder.

Occupancy Certificate

Another name for occupancy certificate is completion certificate or the pass certificate. This document is evidence that the property has been built in accordance with the approved plan. All buyers of residential projects in India should know about this certificate and they should demand this from the builder at the time of shifting into their new homes. It is for the builder to get the local city planning authority to issue it after successful completion of the construction. This is a certification that the residential project has been rendered suitable for living after completion. Usually, builders shy away from getting occupancy certificates for the simple reason that they have failed to meet all the directives listed in the approval letter.

For second sale of a property or to apply for a home loan, the existing home owner may require an OC. For that matter, even when availing utility connections, an OC might be a necessity. As a precaution against the problems faced by Varun and many others like him, it becomes exigent to demand an occupancy certificate. Irrespective of whether or not the building has all connections, the certificate is essential because the municipal authority has the power to cut off connections if it finds any inconsistency in the construction.

Possession Letter without Occupancy Certificate

In case a developer agrees to give possession of the flat to the buyer but refuses to issue a legitimate occupancy certificate, then the buyer is entitled to refuse it. There are other options for homebuyers such as, consumer forum, Right to Information (RTI) which they can resort to for getting information on whether or not the builder has a valid completion certificate.


A property buyer should be updated and well aware and should refrain from taking hurried decisions. At the time of receiving possession of property, a buyer should ensure that all the required documents are provided by the builder. There has to be a united perseverance and awareness among homebuyers fueling a firmness to demand a possession letter and an occupancy certificate along with other relevant documentation.

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