· 

Builder - Delay in possession

Choose your Language

Disclaimer: This is an auto generated translation. Refer to judgement

Download Judgment

Download
2020 SCeJournal Builder.pdf
Adobe Acrobat Document 366.8 KB

 (i) Consumer Protection Act, 1986 – Section 12(1)(c) - Builder – Delay in possession - Compensation for delay – Agreement – Condition in – Whether binding -  Whether the flat buyers are constrained by the stipulation contained in clause of Apartment Buyers Agreement (ABA)  providing compensation for delay at the rate of Rs 5 per square feet per month or a higher amount ?   - Condition which has been prescribed in clause providing compensation for delay  continue to bind the flat purchaser indefinitely irrespective of the length of the delay?  - In assessing the legal position, it is necessary to record that the ABA is clearly one-sided -  Where a flat purchaser pays the instalments that are due in terms of the agreement with a delay, clause 39(a) stipulates that the developer would "at its sole option and discretion" waive a breach by the allottee of failing to make payments in accordance with the schedule, subject to the condition that the allottee would be charged interest at the rate of 15 per cent per month for the first ninety days and thereafter at an additional penal interest of 3 per cent per annum -  In other words, a delay on the part of the flat buyer attracts interest at the rate of 18 per cent per annum beyond ninety days -  On the other hand, where a developer delays in handing over possession the flat buyer is restricted to receiving interest at Rs 5 per square foot per month which works out to 1-1.5 per cent interest per annum -  The agreement stipulates thirty-six months as the date for the handing over of possession - Evidently, the terms of the agreement have been drafted by the developer -  They do not maintain a level platform as between the developer and purchaser -  The stringency of the terms which bind the purchaser are not mirrored by the obligations for meeting times lines by the developer -  The agreement does not reflect an even bargain - Builder shall, as a measure of compensation, pay an amount calculated at the rate of 6 per cent simple interest per annum  - Amount shall be computed on the total amounts paid towards the purchase of the respective flats with effect from the date of expiry of thirty-six months from the execution of the respective ABAs until the date of the offer of possession after the receipt of the occupation certificate -  The above amount shall be in addition to the amounts which have been paid over or credited by the developer at the rate of Rs 5 per square foot per month at the time of the drawing of final accounts - The amounts shall be paid over within a period of one month from the date of this judgment failing which they shall carry interest at the rate of 9 per cent per annum until payment. #2020 SCeJ 1412 [Para 22, 55]

 

 

Newspaper reports

 

PIL based on Newspaper reports

Read more...

 

 

(ii) Consumer Protection Act, 1986 – Section 12(1)(c) - Builder  - Apartment Buyers Agreement   - Evidently, the terms of the agreement have been drafted by the developer -  They do not maintain a level platform as between the developer and purchaser -  The stringency of the terms which bind the purchaser are not mirrored by the obligations for meeting times lines by the developer -  The agreement does not reflect an even bargain - Undoubtedly, as this court held in DLF Homes Panchkula Pvt. Ltd. vs. D S Dhanda, 2019 SCC OnLine SC 689, courts ordinarily would hold parties down to a contractual bargain -  Equally the court cannot be oblivious to the one-sided nature of ABAs which are drafted by and to protect the interest of the developer. Parliament consciously designed remedies in the CP Act 1986 to protect consumers -  Where there has been a gross delay in the handing over of possession beyond the contractually stipulated debt, we are clearly of the view that the jurisdiction of the consumer forum to award just and reasonable compensation as an incident of its power to direct the removal of a deficiency in service is not constrained by the terms of a rate which is prescribed in an unfair bargain. #2020 SCeJ 1412 [Para 22, 24]

 

(iii) Consumer Protection Act, 1986 – Section 2 (1) (o), Section 14(1)(e) - Intrinsic to the jurisdiction which has been conferred to direct the removal of a deficiency in service is the provision of compensation as a measure of restitution. #2020 SCeJ 1412 [Para 24]   

 

 

 

Bail

 

Keeping an undertrial in jail seriously jeopardises the preparation of his legal defence

Read more...

 

(iv) Consumer Protection Act, 1986 – Section 12(1)(c) - Builder – Possession – Delay in possession  - Apartment Buyers Agreement   -  A failure of the developer to comply with the contractual obligation to provide the flat to a flat purchaser within a contractually stipulated period amounts to a deficiency -  There is a fault, shortcoming or inadequacy in the nature and manner of performance which has been undertaken to be performed in pursuance of the contract in relation to the service - Under Section 14(1)(e), the jurisdiction of the consumer forum extends to directing the opposite party inter alia to remove the deficiency in the service in question -  Intrinsic to the jurisdiction which has been conferred to direct the removal of a deficiency in service is the provision of compensation as a measure of restitution to a flat buyer for the delay which has been occasioned by the developer beyond the period within which possession was to be handed over to the purchaser -  Flat purchasers suffer agony and harassment, as a result of the default of the developer -  Flat purchasers make legitimate assessments in regard to the future course of their lives based on the flat which has been purchased being available for use and occupation -  These legitimate expectations are belied when the developer as in the present case is guilty of a delay of years in the fulfilment of a contractual obligation -  To uphold the contention of the developer that the flat buyer is constrained by the terms of the agreed rate irrespective of the nature or extent of delay would result in a miscarriage of justice -  Undoubtedly, as this court held in DLF Homes Panchkula Pvt. Ltd. vs. D S Dhanda, 2019 SCC OnLine SC 689,  courts ordinarily would hold parties down to a contractual bargain -  Equally the court cannot be oblivious to the one-sided nature of ABAs which are drafted by and to protect the interest of the developer -  Parliament consciously designed remedies in the CP Act 1986 to protect consumers - Dhanda's case does not prescribe an absolute embargo on the award of compensation beyond the rate stipulated in the flat buyers' agreement where handing over of the possession of a flat has been delayed -  Where, as in the present case, there has been a gross delay in the handing over of possession beyond the contractually stipulated debt, we are clearly of the view that the jurisdiction of the consumer forum to award just and reasonable compensation as an incident of its power to direct the removal of a deficiency in service is not constrained by the terms of a rate which is prescribed in an unfair bargain#2020 SCeJ 1412 [Para 24, 31, 32]

 

 

(v) Builder – Deed of conveyance – Effect of on claim for delayed possession -  Whether a flat buyer who seeks to espouse a claim against the developer for delayed possession can as a consequence of doing so be compelled to defer the right to obtain a conveyance to perfect their title? -    It would, in our view, be manifestly unreasonable to expect that in order to pursue a claim for compensation for delayed handing over of possession, the purchaser must indefinitely defer obtaining a conveyance of the premises purchased or, if they seek to obtain a Deed of Conveyance to forsake the right to claim compensation - This basically is a position which the NCDRC has espoused - We cannot countenance that view - Ee are unable to subscribe to the view of the NCDRC that flat purchasers who obtained possession or executed Deeds of Conveyance have lost their right to make a claim for compensation for the delayed handing over of the flats. #2020 SCeJ 1412 [Para 34, 36]

 

 

Cruelty - HMA

 

Hindu Marriage Act, 1955 , Section 13(1)(i-a) - Divorce – Cruelty

Read more... 

 

 

(vi) Consumer Protection Act, 1986 – Section 12(1)(c) - Builder – Delay in possession – Settlement deeds  - Where purchasers who entered into specific settlement deeds with the developers  - It would be only appropriate and proper if they are held down to the terms of the bargain - Do not accept the contention that the settlement deeds were executed under coercion or undue influence since no specific material has been produced on record to demonstrate the same. #2020 SCeJ 1412  [Para 37]

 

(vii) Consumer Protection Act, 1986 – Section 12(1)(c) -  Builder – Delay in possession – Buyers who have transferred their title, right and interest in the apartments would not be entitled to the benefit of the present order since they have sold their interest in the apartments to third parties#2020 SCeJ 1412 [Para 38]

 

(viii) Consumer Protection Act, 1986 – Section 12(1)(c) - Builder – Delay in possession – Subsequent transferees can not step into the shoes of the original buyer for the purpose of benefiting from this order -  The subsequent transferees in spite of being aware of the delay in delivery of possession the flats, had purchased the interest in the apartments from the original buyers -  Further, it cannot be said that the subsequent transferees suffered any agony and harassment comparable to that of the first buyers, as a result of the delay in the delivery of possession in order to be entitled to compensation. #2020 SCeJ 1412 [Para 38]

 

(ix) Consumer Protection Act, 1986 – Section 12(1)(c) - Builder – Amenities  - Failure to provide – Stand of developer that though there has been a failure on their part to provide the amenities, the flat buyers have the benefit of facilities in the surrounding area which has become urbanised - Plea that the "existing population cannot sustain these facilities" - a school, commercial complex and health care facilities - Cannot agree with this line of submissions - Developer must be held accountable to its representation - To allow the developer to escape their obligation would put a premium on false assurances and representations made to the flat purchasers. Hence, in factoring in the compensation which should be provided to the flat buyers who are concerned in the present batch of appeals, we would necessarily have to bear this issue in mind. #2020 SCeJ 1412 [Para 43]

 

 

(x) Consumer Protection Act, 1986 – Section 12(1)(c) - Builder – Taxes – Payment of – Delay -   The specific conditions contained in the ABA clearly imposed the liability to bear the proportionate share of taxes on the purchasers - The developer has offered an explanation of why as a result of pending litigation, the dues towards works contract tax were not paid earlier -  Indeed, if they were paid earlier, the purchasers would have been required to reimburse their proportionate share of taxes earlier as well -  No part of the penalty imposed on the developer has been passed on to the purchasers -  There is no deficiency of service in regard to the demand of interest payable on the tax which was required to be deposited with the revenue. #2020 SCeJ 1412 [Para 47]

 

(xi) Consumer Protection Act, 1986 – Section 12(1)(c) - Builder – Parking – Payment of  - Flat buyers seek a refund of the amount collected from each buyer towards car parking as under the Section 3(f) of the Karnataka Apartment Ownership Act 1972 common areas and facilities include parking areas, and that they had  already paid for the super area including common areas and facilities which would be deemed to include car parking under the KAO Act -  The ABA contained a break-up of the total price of the apartment -  Parking charges for exclusive use of earmarked parking spaces were separately included in the break-up - The parking charges were revealed to the flat buyers in the brochure. The charges are recovered are in terms of the agreement - Karnataka Apartment Ownership Act, 1972, Section 3(f). #2020 SCeJ 1412 [Para 48]

 

 

 

 

 

Write a comment

Comments: 0