Builder Legally Obligated To Deliver Completed Unit With Conveyance Deed: NCDRC

The National Consumer Disputes Redressal Commission, presided by Justice Ram Surat Maurya and Mr. Bharatkumar Pandya, held that a builder is legally obligated to deliver a completed unit with the conveyance deed, and failure to do so constitutes a deficiency in service. Brief Facts of the Case The complainant booked a flat with Marvel Developers/developer, which had launched a housing project, “Marvel Piazza,” in Pune, promising completion and possession by a certain date. After booking flats and making substantial payments, the complainant discovered delays and issues, including part of the project falling under an Air Force restriction area, which affected promised amenities. Despite repeated follow-ups, the developer failed to deliver possession or refund the amounts. The complainants took legal action, including filing complaints with the police and the Maharashtra Real Estate Regulatory Authority (RERA), but the issues remained unresolved, leading to the filing of the consumer complaint. Contentions of the Developer The developer acknowledged the booking of the flats, agreements, and deposits made by the complainant. They stated that the project, “Marvel Piazza,” consists of 11 buildings, and the amenities provided did not include the “Air Force Restricted Zone”, as alleged by the complainant. The complainant took possession of the flats for interior work and received a rebate but later made illegal constructions, leading to objections from municipal authorities and delays in obtaining the occupancy certificate. The developer claimed the complainant was at fault for delayed payments and attempted to initiate false criminal proceedings. They also argued that the complaint is barred by limitation, was filed for commercial purposes, and is not maintainable due to pending complaints before the Maharashtra RERA. The developer requested the dismissal of the complaint. Observations by the National Commission The National Commission observed that in line with the Supreme Court's judgment in Ireo Grace Realtech Private Limited vs Abhishek Khanna (2021) 3 SCC 241, the developer's claim that the complaint should be dismissed due to estoppel by election, as it was filed after complaints with MRERA, is unfounded. The complainants withdrew their complaints from MRERA and settled, but the developer willingly submitted to this Commission's jurisdiction for the remaining claims. The argument that the complaint is time-barred is also dismissed, as possession was offered within two years of obtaining the occupation certificate. The Supreme Court, in cases such as Lata Construction vs Dr Ramesh Chandra Ramaniklal Shah (2000) 1 SCC 586, Meerut Development Authority vs Mukesh K. Gupla IV (2012) CPJ 12 (SC), and Samruddi Cooperative Housing Society Limited vs Mumbai Mahalaxmi Construction Pvt. Ltd., AIR 2022 SC 428, held that a builder is legally obligated to deliver a completed unit and execute the conveyance deed, and failure to do so constitutes a continuing wrong. Regarding the complainants' claims for land reimbursement, the Commission found no evidence that the developer received compensation or Transferable Development Rights (TDR) for the land transferred for public use, dismissing individual claims for compensation. Additionally, the claim for compensation of ₹25 lakhs for unprovided amenities was rejected as the sanctioned plan did not include such amenities, and photographs showed the promised amenities were provided. The delay in offering possession was attributed to various factors, including demonetization, unauthorized construction by the complainants, and the COVID-19 pandemic, which justified the extension of time. However, compensation for the delay from January 2018 to December 2019 was deemed appropriate, calculated at 6% interest per annum, consistent with the Supreme Court's decision in DLF Home Developers Pvt. Ltd. vs. Capital Green Flat Buyer's Association (2021) 5 SCC 537. The National Commission allowed the appeal and directed the builder to pay delay compensation in the form of interest @6% per annum. Case Title: Kishor V. Patil Vs. M/S. Marvel Zeta Developers Pvt. Ltd. Case Number: C.C. No. 58/2022 Click Here To Read/download Order

Builder Legally Obligated To Deliver Completed Unit With Conveyance Deed: NCDRC

Ayushi Rani

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