Withholding Deposit Without Any Prospect Of Delivering Possession: NCDRC Holds Realtech Development Liable For Deficiency In Service

Brief Facts of the Case

The complainants booked a residential unit from Realtech Development and Infrastructure/developer for Rs. 3.5 crore, paying an initial Rs. 58,79,841 in installments. Despite repeated inquiries, the developer failed to issue an allotment letter, execute a buyer's agreement, or even begin excavation work. Frustrated by the lack of progress and responses, the complainants sought to cancel the booking and requested a refund with interest, which the developer ignored. Subsequently, the complainants filed a complaint under the Consumer Protection Act, before the National Commission, seeking a refund of Rs. 58,79,841 with 18% interest, Rs. 10 lakh as compensation for mental agony, and Rs. 1.5 lakh for litigation costs.

Contentions of the Developer

Despite being served notice via post and publication, no one appeared on behalf of the real estate developers, and they were proceeded against ex-parte.

Observations by the National Commission

The National Commission observed that the complainants booked a residential unit and paid a total of Rs. 58,79,841 to the developer, but the developer failed to provide an allotment letter, execute a builder-buyer agreement, or deliver physical possession of the unit. The promised timeline for project completion was not honored, and the complainants' money remained with the developer for years without any prospect of possession. This was deemed a clear deficiency in service. The Hon'ble Supreme Court, in M/s Nexgen Infracon Pvt. Ltd. Vs Manish Kumar Sinha and DLF Homes Panchkula Pvt. Ltd. vs. D.S. Dhanda, held that buyers are entitled to refunds with interest for undue delays and that multiple compensations for a single deficiency are unjustifiable. Relying on these precedents, the Commission directed the developer to refund Rs. 58,79,841 to the complainants with 9% annual interest from the date of deposit until realization. Additionally, the developer was ordered to pay ₹50,000 as litigation costs.

Case Title: Vivek Gulati Vs. Realtech Developments And Infrastructure(India) Pvt. Ltd.

Case Number: C.C. No. 1434/2018

Click Here To Read/Download The order