Buyers Can't Be Compelled To Accept Delayed Possession Of Flats: Reiterates NCDRC [Read Order]

Facts

The Complainants had booked a high end residential flat with the OP in a project namely 'Araya', in Gurgaon. As per clause 11.2 of the Apartment Buyers Agreement, executed between the parties, OP was obligated to apply for Occupancy Certificate (OC) within 39 months from the date of excavation, and also entitled to a grace period of 180 days, after expiry of the said 39 months period.

It was however alleged by the Complainants that the OP could not discharge the aforementioned obligation and they were forced to file a Complaint before the forum, seeking a refund of Rs. 4,75,27,981 which was paid by the them for booking the said property.

The OP refuted the contentions of the Complainants on three grounds:

1. The Complainants were 'speculators' who held various properties in Gurgaon and Delhi.
2. The OC in respect of the towers in which flat was allotted to the Complainants was obtained by them on 23.7.2018 and thereafter the possession of the allotted flat was offered to the Complainants vide letter dated 28.8.2018, which the Complainants refused.
3. The verdict in Govindan Raghavan & Anr. v. Pioneer Urban Land & Infrastructure Ltd., CC No. 239 of 2017, decided by NCDRC and later upheld by the Supreme Court was inapplicable in the present case. The Complainant in this precedent was granted refund because he had already taken possession in alternative property. Since the Complainants herein have not taken any such alternative possession, they have no justification for refusing to take possession and insisting upon refund, it was submitted.

The Complainants submitted that in the aforementioned case, the Supreme Court had upheld the termination of the agreement by the flat buyers primarily on account of unreasonable delay in completion of the construction and not on account of acquisition of alternative accommodation. Further, in an affidavit filed in this behalf, they submitted that they were unwilling to take possession of the property because of two reasons: (i) air & noise pollution in the area due to ongoing construction of other towers by the OP, and (ii) inordinate delay in transferring possession which had frustrated their plan of living near their child in an Ultra-Luxurious Project.

Findings

The Commission did not find merit in the arguments advanced by the OP and it was held with regards to their first contention that there was no written evidence on record to substantiate that the Complainants were speculators. Further, the second contention of the OP was also discarded on the grounds that the offer for possession was made by the OP after an admitted delay of over two years and the Complainants had by then already filed the complaint for refund.

Dismissing the third contention of the OP, Justice V.K. Jain held that in view of the principle approved by the Hon'ble Supreme Court in Govindan Raghavan & Anr. v. Pioneer Urban Land & Infrastructure Ltd., in case of an unreasonable delay, which the builder is unable to explain, the choice will be with the buyer whether to take a belated possession or to seek refund with appropriate compensation. "The Complainants are justified in insisting upon refund of the amount paid by them to the opposite party", the judge said.

Notably, the Supreme Court in Lucknow Development Authority v. M.K. Gupta, 1994 SCC (1) 243, had held that when a person hires the services of a builder, or a contractor, for the construction of a house or a flat, and the same is for a consideration, it is a "service" as defined by Section 2 (o) of the Consumer Protection Act, 1986. The inordinate delay in handing over possession of the flat clearly amounts to deficiency of service.

The Apex Court had also, on a previous occasion in Fortune Infrastructure & Anr. v. Trevor D'Lima & Ors., (2018) 5 SCC 442, held that a person cannot be made to wait indefinitely for possession of the flat allotted to him, and is entitled to seek refund of the amount paid by him, along with compensation.

Accordingly, the OP was directed to refund the entire principal amount to the Complainants along with litigation expenses and compensation in the form of simple interest @ 10.65% per annum in terms of Rule 15 of Haryana Real Estate (Regulation And Development) Rules 2017 w.e.f. the date of each payment till the date of refund, within three months of the order.

Arguments for the Complainants were advanced by Advocates Aditya Parolia and Nithin Chandran and for the OP by Advocates Gayatri Gulati, Sneh Dhillon and T.V.S. Raghavendra Sreyas.

Click here to download the Order