Developer Cannot Take Advantage Of Death Of Workers To Justify Delay In Construction, Says NCDRC [Read Order]

A developer cannot cry force majeure to blame the delay in completion of housing project on deaths of workers at the construction site when the same has been caused due to lack of safety measures, the National Consumer Disputes Redressal Commission has said.

NCDRC Presiding member V K Jain said the developer cannot take advantage of the deaths of workers on its project site to cover the delay in completion of housing project when the deaths have been the result of its own negligence.

The Commission said so while hearing a number of complaints against DLF Universal Limited and DLF Home Developers. The complaints had been filed by home buyers who had invested in its project namely "DLF Capital Greens" at Moti Nagar in North Delhi.

Since possession of the apartment was not delivered within the time period committed by the developer, the Homebuyers, some individually and some under a society called Capital Greens Flat Buyers Association approached NCDRC seeking possession of the allotted apartments along with compensation.

During the arguments, DLF submitted that the delay was primarily on account of the abnormal time taken in approval of the building plans and the order issued by the Government of NCT of Delhi, prohibiting construction for a considerable time, both circumstances beyond its control.

Justice Jain, however, noted, "A perusal of the prohibition letter dated 26.5.2014 issued by the Directorate of Industrial Safety & Health (Labour Department), Government of NCT of Delhi would show that there have been as many as six fatal accidents at the side of this project. One death each of the workers took place on 04.9.2011, 11.4.2012, 16.8.2012, 28.2.2013, 16.1.2014 and 17.5.2014. The work at the site was not stopped by the Government despite loss of five lives prior to 17.5.2014. After a fatal accident on 17.5.2014, an inspection was carried out and it was revealed that a worker had slipped while applying paint on tower No.14 and had later died.

"It was in view of the repeated accidents in the past on the same site, that the authorities held that the said site was dangerous to the safety and health of building workers. It was also noticed that despite previous directions issued by the Government and suggestion given by the National Safety Council vide its Safety Audit Report on 3.4.2014, the requisite measures for safety of the workers had not been taken. The Government was therefore constrained to stop the construction work till all the safety, health and welfare provisions were taken," he said.

"Had the developer or the contractor engaged by it taken the requisite measures and complied with the directions issued by the Authorities and implemented the suggestions given by National Safety Council, the unfortunate incident of 17.5.2014, resulting in loss of sixth human lives at the same project would not have happened and consequently the work at this site would not have been stopped…Had all the requisite safety precautions been taken as many as six incidents at the same site resulting in loss of six precious human lives would not have happened in a span of 2 1⁄2 years.

"Therefore, the developer, in my opinion cannot get any advantage on account of the aforesaid prohibitory order dated 26.5.2014 by taking advantage of its own negligence or the negligence of the contractor engaged by it. In any case, the compensation which the developer will have to pay to the allottees can always be claimed by it from the contractor to the extent it relates to the period the work was prohibited by the Government on account of the above referred fatal accidents," opined Justice Jain.

The NCDRC also rejected DLF's argument that the allottees have not proved any loss or damage on account of the delay in offer of possession, whereas there has been substantial appreciation in the value of the apartments.

DLF also said though the allottees were given escalation free allotments, they are entitled to compensation @ Rs.10 per sq. feet of super area in terms of clause 14 of the agreements though it would be payable to those allottees who had made timely payment of the installments.

"I am unable to accept the contention that there has been no loss to the allottees on account of the delay in offer of possession. Had the apartments been delivered to them in time, they would have been living therein, besides having the mental satisfaction of living in their own houses. Also, it can hardly be disputed that the allottee who waits for a long time for the possession of the apartments allotted to him by a developer, despite his having made payment in time either from his own savings or by raising loans undergoes a lot of mental agony and harassment on account of the said delay and the umpteen rounds he has to make to the office of the developer just to realize the fruits of his hard-earned income.

"Moreover, if such terms are allowed to prevail, an unscrupulous builder would like to take advantage of such a term and delay the construction of the flat for an indefinite time, utilizing the money collected from the flat buyers for other projects or for its other purposes. Such a situation cannot be accepted by a consumer forum which is set up primarily to protect the genuine interests of the consumers. A paltry compensation of say Rs.10 per sq. ft. of the super area per month is at best a token compensation and does not provide adequate redress to the aggrieved allottee. If the developer knows that he can get away with paying such a paltry compensation, there will be no pressure on him to complete the construction and delivery of possession to the allottees since he knows that the said token compensation is only a fraction of the cost of the borrowings if he has to borrow funds from the market, including banks and financial institutions," said Justice Jain.

The Commission then ordered that DLF shall pay compensation in the form of simple interest @ 7% per annum from the expected date for delivery of possession till the date on which the possession was actually offered to the allottees. In case of subsequent purchasers, the period expected for the delivery of possession will be computed from the date of purchase by them.

It ordered that conveyance deed in favour of allottees be executed within three months.

Click here to download the Order