What is booking amount?
Also called: booking money, application money, EOI amount, booking advance
The booking amount is what you pay a developer to reserve a specific unit in a new project before the agreement for sale is signed. Under Section 13 of the RERA Act, it cannot exceed 10% of the cost without a registered agreement for sale.
Walk into a sales office in Gurugram, Whitefield or Hinjewadi and the first cheque you're asked for is the booking amount. It secures a named unit at the quoted price, and in return you get an acknowledgement of your application and, within a few weeks, an allotment letter. Developers ask for either a fixed sum, often ₹2 lakh to ₹5 lakh for mid-market flats, or a percentage such as 5% or 10% of the cost.
RERA put a ceiling on this. Section 13(1) of the Real Estate (Regulation and Development) Act, 2016 bars a promoter from accepting more than 10% of the cost of the apartment, plot or building as an advance or application fee without first executing a written agreement for sale and registering it. So if a builder wants 20% within a month of booking, the agreement has to be registered first, which in Maharashtra also means stamp duty is paid at that stage.
Refunds are the sore point. Many application forms say the booking amount is non-refundable after a cooling-off period of 15 to 30 days, and some let the builder deduct processing fees and GST even inside that window. Read the cancellation clause in the application form before signing, because the application is where the builder's terms first bind you. If the project isn't registered with the state RERA, don't pay at all. Section 3 forbids a promoter from advertising, booking or selling units in an unregistered project.
Ask for the receipt to state the unit number, the carpet area, the rate per sq ft and the payment plan chosen. A receipt that only says 'booking against a 3 BHK in Tower C' leaves room for the unit to be swapped later.
A buyer books a 2 BHK of 740 sq ft carpet area priced at ₹1.1 crore in a Thane project and pays ₹5 lakh. The builder may collect up to ₹11 lakh before the agreement for sale is registered; anything beyond that needs the registered agreement first.
Paying at a launch event on the strength of a brochure, before checking the RERA registration and reading the cancellation terms printed on the back of the application form.
Questions people ask about booking amount
Is the booking amount refundable?
It depends on the application form. Most allow a full or near-full refund within a short cooling-off period and deductions after that, so read the clause before paying.
Is GST charged on the booking amount?
Yes, for an under-construction flat. GST is due on advances at the same rate as the flat, 5% or 1% for affordable housing, and it appears on the booking receipt.