Skip to main content

Home Buyers Can Seek Higher Compensation Than Token Amount Specified In Contract For Delayed Delivery Of Possession

In EMAAR MGF LAND LTD vs GOVIND PAUL, a review petition was filed by the builder before the NCDRC against the order of the State Forum.

The complainant, Mr. Govind Paul, had entered into an agreement with Emaar in September 2011 for a property that was supposed to be handed over in 36 months. After a delay of about 20 months, Paul approached the consumer commission of Chandigarh seeking refund of his payment and compensation for the delay. The State Commission had ordered refund of the principal amount of Rs 38.9 lakh at 15% interest compounded quarterly and Rs. 3 lakh compensation to be paid by Emaar. It had further directed the builder to pay Rs. 25,000 to Paul as cost of litigation. The builder argued before the National Forum that the builder-buyer agreement allowed compensation of Rs. 5 per sq. per month.

The NCDRC while dismissing the review petition has ruled that builders cannot shield themselves behind the clause in the builder-buyer agreement to pay Rs. 5 per sq. feet per month as compensation for delay in handing over flats for an “unreasonable” period and that the buyers have the option to seek higher compensation after taking possession of the property, or seek refund of the amount paid.

Explaining that the builder would have to hand over possession within 36 months and that only a “short reasonable delay” would attract the token compensation provided for in the agreement, it asserted that the two natural corollaries flow from this assertion: 1. the consumer-complainant has the fundamental option to obtain the possession of the unit as and when it is offered by the builder and in addition seek equitable and just compensation for the delay; or 2. the consumer-complainant can claim refund of the principal amount; interest thereon; compensation; and cost of litigation if the offering of possession of the unit is unreasonably delayed.

Comments

Post a Comment

Most viewed this month

The recovery of vehicles by the financier not an offence - SC

Special Leave Petition (Crl.) No. 8907  of 2009 Anup Sarmah (Petitioner) Vs Bhola Nath Sharma & Ors.(Respondents) The petitioner submitted that  respondents-financer had forcibly taken away the vehicle financed by them and  illegally deprived the petitioner from its lawful possession  and  thus,  committed  a crime. The complaint filed by the petitioner had been  entertained  by  the Judicial Magistrate (Ist Class), Gauhati (Assam) in Complaint Case  No.  608 of 2009, even directing the interim custody of the vehicle (Maruti  Zen)  be given to the petitioner vide order dated  17.3.2009.  The respondent on approaching the Guwahati High  Court against this order, the hon'ble court squashed the criminal  proceedings  pending   before  the  learned Magistrate. After hearing both sides, the Hon'ble Supreme Court decided on 30th...
7 comments
Read more

Mere Agreement To Sell The Leased Property To Tenant Would Not Terminate Landlord-Tenant Relationship

In CIVIL APPEAL Nos. 1237­1238 OF 2019, Dr. H.K. Sharma vs Shri Ram Lal, the tenant had objected against the eviction suit filed by the landlord, claiming that the landlord-tenant relationship between them had ceased to exist by virtue of an agreement for sale entered between them and that he has already paid some money in advance based on the agreement. The tenant contented as the landlord-tenant relationship did not exist, the landlord cannot evict him. The matter went through various forums and finally landed before the Supreme Court in appeal. The Supreme Court referring to the judgment in Shah Mathuradas Maganlal & Co. vs. Nagappa Shankarappa Malage & Ors., held that in the instant case the lease agreement included no clauses on the fate of the tenancy. A fortiori, the parties did not intend to surrender the tenancy rights despite entering into an agreement of sale of the tenanted property. In other words, if the parties really intended to surrender their tenancy ...
2 comments
Read more

Valuation Report of Jewellery once made is effective for Four Assessment Years

The division Bench of the Delhi High Court in Pr.Commissioner of Wealth Tax vs. Raghu Hari Dalmia held that a valuation report made by a registered valuer once adopted shall be in effect for four assessment years unless an event has occurred whereby the value is increased or decreased. The High Court made it clear that the event of “search” under Section 132 of the Income Tax Act, 1961 cannot compel the assessee to undertake a fresh valuation.
2 comments
Read more