Delay In Handover Of Flat Amounts To Deficiency Of Service: Delhi State Consumer Commission Directs G.S. Promoters To Refund ₹69.27 Lakh With Interest

The Delhi State Consumer Disputes Redressal Commission, comprising Justice Sangita Dhingra Sehgal (President) and Ms. Bimla Kumari (Member), has held M/S G.S. Promoters Pvt. Ltd. liable for deficiency of service for failing to complete construction and hand over possession of an apartment in its “Sikka Karmic Green” project within the stipulated time.

The Commission allowed the complaint and reiterated that housing construction constitutes a "service" under the Consumer Protection Act, and the developer's failure to complete the project on time constituted a clear deficiency of service.

Brief Facts

The complainants, Gagan Baghel and Manju Baghel, came into contract with M/S G.S Promoters Pvt. Ltd. (Opposite Party) for the delivery of a 3 BHK apartment in the "Sikka Karmic Green" project, Noida, by paying Rs. 6,92,714 to book the flat. On 15-01-2015, the OP executed a Flat Allotment Agreement for the total basic sale price of Rs. 69,27,130/- Payment Plan-I.

As per the agreement, the Opposite Party was required to complete the construction within 20 months from the date of the agreement. Thereafter, the developer issued an Offer of Possession for Fit-Out dated 28 March 2016, pursuant to which the remaining amount was also paid.

The complainants came to know that the Opposite Party had failed to obtain the Occupation Certificate , as the construction of the said project was incomplete. As a result, the complainants issued a legal notice on 23-01-2017, seeking possession of the said flat or, in the alternative, a refund of the amount deposited by them along with interest. However, the OP failed to hand over possession.

Aggrieved, the complainants approached the Delhi State Consumer Disputes Redressal Commission seeking possession or refund of ₹90,07,130 with interest, along with compen-sation and litigation costs.

Arguments of the Opposite Party

The developer contended that the Commission lacked territorial and pecuniary jurisdiction since the project was situated in Noida, Uttar Pradesh. It was argued that the complainants were habitual defaulters with an outstanding amount of approximately ₹11.5 lakh, and that the allotment was terminated on 17 December 2015.

The developer denied deficiency of service, stating that the Occupation Certificate was ob-tained in 2017 and that possession had been offered to allottees.

Observations by the Commission

Rejecting the objections, the Commission held that the developer was deficient in service for failing to complete construction and hand over possession within the agreed timeframe, despite having received the entire sale consideration.

The Commission noted that the Occupation Certificate was obtained only on 21 November 2017, well beyond the contractual and extended timelines. It further observed that the plea of cancellation was untenable, as the developer continued to accept payments until May 2016 and had issued an Offer of Possession for Fit-Out in March 2016.

Reiterating that housing construction falls within the ambit of “service” under the Consum-er Protection Act, the Commission allowed the complaint.

Accordingly, the commission allowed the complaint and directed M/S G.S. Promoters Pvt. Ltd.:

• Refund ₹69,27,130 with 6% interest per annum, calculated from the date of each in-stalment if paid on or before 27 March 2026;

• Pay 9% interest per annum in case of default beyond the stipulated date;

• Pay ₹3,00,000 as compensation for mental agony and harassment; and

• Pay ₹35,000 as litigation costs.

Case Title: GAGAN BAGHEL AND ANR. VS G.S PROMOTERS PVT. LTD. CC. NO. 1046/2017

Click Here To Read/Download order