TN RERA Orders Builder To Compensate Homebuyer For Mental Agony Faced Due To Delayed Possession

Background Facts

The builder was constructing a residential project named Poomalai Avantikaa in Pallavaram Taluk, Chennai. On the 5 September 2019, the homebuyers entered into a sale deed with the builder to purchase an Undivided Share of Land (UDS) of 685 sq. ft., for a consideration of Rs. 13,76,850. Additionally, a construction agreement was executed on the 13 June 2019, whereby the builder promised the construction of a residential flat spanning 1324 sq. ft. with one car parking facility.

Subsequently, for the purpose of financing the construction, the homebuyers secured a home loan amounting to Rs. 52,99,000 from SBI in June 2019. As per the terms of the construction agreement, the completion and delivery of the project were scheduled for May 30, 2020. Furthermore, Clause 4(b) of the construction agreement stipulated that the builder would be accountable for compensation of Rs. 10 per sq. ft. per month in case of construction delays.

Due to the COVID-19 pandemic, the project's completion timeline was extended, which eventually lapsed until February 2021. Despite repeated reminders and personal engagements, the builder failed to fulfill the project's obligations. Subsequently, on the 3rd of November 2022, the homebuyers issued a legal notice to the builder. After receiving no response, the homebuyers filed a complaint before TNRERA seeking compensation for the mental distress, inconvenience, and litigation expenses.

TNRERA Order

TNRERA held that the Homebuyers suffered mental anguish and inconvenience due to the delayed delivery of possessions, as they diligently made all necessary payments within a short timeframe. Additionally, the Homebuyers obtained a home loan of Rs.52,99,000 for constructing the flat.

TNRERA observed that it is natural for a homebuyer to expect timely completion and delivery of a residential unit after fulfilling all legal requirements. However, in this instance, the Homebuyers were not provided with a completed residential flat as promised. Subsequently, aggrieved by the builder's conduct, the complainant issued a legal notice to the builder on 03.11.2022, urging adherence to the TNRERA Act and seeking a full refund along with compensation. The builder failed to respond to this notice.

Therefore, TNRERA directed the Builder to compensate the homebuyer with Rs. 200,000 for mental agony and inconvenience, along with an additional Rs. 50,000 to cover the costs of litigation, all within a period of 90 days.

Case - Melvin Victor De Poures Versus M/S Poomalai Housing Private Limited

Citation - CCP NO 43 of 2023

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