A decision of the Apex Court has tightened the noose on the builders. A bench of Justice Uday Umesh Lalit & Justice Indu Malhotra made it clear in its judgment that the unilateral agreement & arbitrariness of the builder will no longer work because when the home buyer is not able to pay installments or arrears, the builder imposes a fine on him that he is obliged to pay, so why no fine on the builder when he is unable to deliver the possession of house/flat on time?
The Top Court in a recent verdict held that the flat buyers are entitled to compensation for “delayed handing over of possession” & for the failure of the developer to fulfil their promises with regard to amenities. The Supreme Court set aside the verdict of the National Consumer Disputes Redressal Commission (NCDRC) which, on July 2, 2019, had dismissed the complaints of 339 flat buyers by holding that they were not entitled to the compensation in excess of what was stipulated in their flat purchase agreements for delayed possession & the lack of assured amenities.
The bench said the flat owners are entitled to the compensation in excess of the amount stipulated in their agreements with the developers.
The compensation amount shall be computed on the total money paid towards the purchase of the respective flats with effect from the date of expiry of thirty-six months from the execution of the respective flat purchase agreements until the date of the offer of possession after the receipt of the occupation certificate, it said.
The compensation amount shall be in addition to the money which has been paid over or credited by the developer at the rate of Rs 5 per square foot per month at the time of the drawing of final accounts, it said. The Supreme Court asked developers to pay the compensation within a period of one month from the date of this judgment & cautioned that failure in making payment, shall carry interest at the rate of nine per cent per annum until payment.
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