National Consumer Commission holds FS Housing Ltd liable for Deficiency in Service

Contentions of the Complainant

The complainant booked a residential flat with FS Housing Ltd, for which they signed a sale agreement and applied for a housing loan from ICICI Bank, leading to a tripartite agreement. Despite commitments, the builder failed to deliver possession within the agreed time, requesting and receiving multiple extensions. The builder, admitting their fault, made partial payments of Rs.160,000 to the complainant but has not compensated for the delay or handed over possession as promised.

Contentions of the Opposite Party

The builder failed to file their written statement within the stipulated time, leading to the proceeding being ex parte.

Observations by the Commission

The commission observed that the terms laid out in the agreement explicitly mentioned the possession date for the apartment unless hindered by force majeure events such as war, flood, drought, fire, cyclone, earthquake, or other natural calamities affecting regular project development. Despite being granted three extensions, the builder failed to fulfill their commitment. The commission referred to Supreme Court cases, such as Fortune Infrastructure Vs. Trevor D' Limba, Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan, and Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra (2019), wherein it was held that homebuyers should not be subjected to an indefinite wait for possession. Highlighting the severity of the builder's negligence, the commission noted that the possession was not handed over even after receiving the entire consideration, which is highly negligent. Referring to the Supreme Court's stance in Experion Developers Pvt. Ltd. vs. Sushma Ashok Shiroor (2002), the commission established that an interest rate of 9% per annum would be just compensation in case of a refund.

The commission directed the builder to refund the entire amount deposited by the complainant with interest @9% per annum from respective dates of deposits till the date of refund after adjusting the amount, if any, already paid to the complainant.