Paid Rs 19 lakh but ‘no flat’ 8 years on, senior citizen wins possession, Rs 2 lakh relief

“The complainant, who is a senior citizen, has been deprived of the use and enjoyment of the flat despite making the substantial payment and arranging housing finance for the same. We are, therefore, of the considered view that there is clear deficiency in service on the part of the opposite parties,” the August 17 order read.

‘No possession’

The complainant claimed that he was allotted a flat in Panchkula by an allotment letter dated August 26, 2015. Thereafter, a flat buyer’s agreement was executed between the complainant and the builder on March 21, 2016. As per the agreement, the basic sale price of the flat was Rs 19.62 lakh.

The man claimed he took a loan to pay the sale amount for the flat. He added that the builders were bound to give possession within four years, but despite making the required payments, he did not receive possession of the flat. Aggrieved, he moved the commission seeking compensation for the loss and inconvenience suffered by him.

Builder’s defence

One of the builders, through its advocate, argued that under the agreement, the date of delivery of possession was tentative and subject to the force majeure clause, which was in the knowledge of the complainant. A force majeure clause in a contract temporarily (sometimes permanently) excuses parties from legal obligations when extraordinary, unforeseeable events make it impossible to carry it out. It was added that due to the emergence of the Covid-19 pandemic, the real estate sector and construction projects were seriously hampered.

The lawyer submitted that the agreement contained a payment plan under which the complainant was to make the due instalments, but he stopped making further payments despite several demand letters, call notices and reminders.

It was argued that the complainant himself breached his obligation to make the entire and timely payment of the instalments and caused losses to the builders, as they had kept one of the apartments reserved for the complainant for a considerable period of time without payment of the agreed instalments. Advocates Ashuthosh Kumar Shrivastav and Rajesh Sharma represented the builder.

‘Can’t take shelter of pandemic’

The commission noted that the possession of the flat was expected by March 2019 and rejected the builder’s claim that the Covid-19 pandemic and nationwide lockdown affected construction activity. “The agreed period for delivery of possession had already expired before the commencement of the nationwide lockdown on March 25, 2020. Therefore, the opposite parties cannot take shelter under the Covid-19 pandemic for a delay which had already occurred before the pandemic began,” it added.

Holding that a consumer who has invested his hard-earned money in a residential project cannot be made to wait indefinitely for possession, the commission held that a builder is under an obligation to complete the project and hand over possession within the agreed period, failing which the consumer is entitled to appropriate compensation for the delay.

Noting that the builders retained and utilised the amount of Rs 19.62 lakh paid by the complainant while failing to deliver possession within the given period, the commission directed them to pay interest at the rate of 9 per cent per annum on the said amount from November 24, 2018, when the entire basic sale consideration stood paid, till the date of actual delivery of possession to the complainant.

The commission directed the builders to complete any remaining construction and development work and hand over actual, physical and peaceful possession of the said flat to the complainant within 30 days.

The commission also directed the builder to pay an amount of Rs 2 lakh to the complainant as compensation for mental agony, harassment, financial inconvenience, and deficiency in service caused due to the inordinate delay in handing over possession of the flat, along with Rs 10,000 towards litigation expenses, within 30 days.

Takeaway

This ruling highlights that a builder cannot indefinitely delay possession after receiving the buyer’s money or seek shelter under reasons such as the Covid-19 pandemic when the agreed possession period had already expired.

For consumer-related grievances, individuals may contact the consumer helpline in their respective states and Union territories (Kerala: 1800-180-2087) or call the National Consumer Helpline at 1915 for assistance.

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