Chandigarh: Real estate firm penalised for failing to give possession of flat on timehttps://indianexpress.com/article/cities/chandigarh/chandigarh-real-estate-firm-penalised-for-failing-to-give-possession-of-flat-on-time-5482492/

Chandigarh: Real estate firm penalised for failing to give possession of flat on time

The commission stated that the firm was bound to deliver possession of the unit within a maximum period of 48 months from the date of execution of the agreement, as such, time was unequivocally made the essence of the contract.

Chandigarh: Real estate firm penalised for failing to give possession of flat on time
The State Consumer Disputes Redressal Commission observed that the complainants have mentioned that the couple was willing to own a residential apartment in Zirakpur for their family and perusal use. (Express photo by Jaipal Singh)

The State Consumer Disputes Redressal Commission has directed a real estate firm to refund Rs 62.49 lakh, along with interest and Rs 1.33 lakh penalty, to a Maharashtra-based couple for not being able to give possession of an apartment in Zirakpur within promised time frame.

Praveen Kumar Rai and Chandani, now based in Pune, had alleged that they had purchased an apartment in a residential complex, Sushma Chandigarh Grande, in resale in December 2012 and an allotment letter had been issued in their favour. Thereafter, Apartment Buyer’s Agreement was executed, which stated that as per Clause 14(d), possession of the apartment was to be delivered within a period of 42 months from the date of execution of the agreement, along with a grace period of six months, that is within four years. Out of the total cost of Rs 66.62 lakh, the couple paid a total amount of Rs 62.49 lakh for the apartment by availing a loan from HDFC bank. Unable to get the possession on time, the couple wrote an email in April 2017 to the real estate firm asking for refund of the amount paid, but they did not bother to reply. The couple thus filed a complaint at the State Consumer Commission of Chandigarh.

Sushma Buildtech Limited and its officials, in reply, submitted that the complainants did not fall within the definition of “consumer” as they have shifted to Pune in June 2014 and have no intention to return and reside at Zirakpur.

Also the real estate prices have not picked pace in recent years, as such, they purchased the apartment solely for speculation purposes, it was stated, adding that as per the agreement, the real estate firm “endeavour(s)” to hand over the possession of the apartment within 48 months from the date of execution of the agreement, as they have specifically mentioned that they would try and endeavour to hand over the possession within 42 months, along with a grace period of six months. While as per clause 14(d), failing to give possession of the apartment within the stated period, they shall pay to the buyer compensation/penalty at Rs 5 per square feet of the super built-up area per month for the entire period of delay. They stand committed to hand over the unit by September or October 2018, while the complainants have also agreed to accept compensation/penalty for delay, by signing and agreeing to the buyer agreement, the complainants cannot seek possession within 48 months, the firm replied.

Advertising

The commission observed that the complainants have mentioned that the couple was willing to own a residential apartment in Zirakpur for their family and perusal use. Even otherwise, it was to be used for the purpose of residence, by the complainant and there is nothing on the record that the complainants are property dealers.

The commission stated as per clause 14(d) of the agreement, the firm was bound to deliver possession of the unit within a maximum period of 48 months from the date of execution of the agreement, as such, time was unequivocally made the essence of the contract.

The commission in the judgement released on Wednesday, holding the real estate firm guilty of deficiency in service, directed it to refund Rs 62,49,847 to the couple, along with an interest at 10 per cent per annum rate from the respective date of purchase of the apartment. It was also directed to pay Rs 1 lakh as compensation amount and
Rs 33,000 as litigation charges.