Delhi State Commission Holds Capital Heights Liable For Failure To Deliver Possession Of Unit Within Stipulated Time

The Delhi State Consumer Disputes Redressal Commission bench comprising Sangita Dhingra Sehgal, President and Pinki,Judicial Member has held Capital Heights Pvt Ltd liable for deficiency in service for failure to hand over possession within stipulated time and giving false assurances regarding possession to the complainants. Brief facts: The complainants booked a residential unit in the project of Capital Heights Private Limited ('Builder') situated at Gurugram by paying a booking amount of Rs. 10,00,000. An allotment letter dated 15.09.2014 was issued and a flat buyer agreement dated 20.10.2014 was executed between the parties. Initially, the agreement provided that the possession will be handed over within 30 months with a grace period of 360 days. However,within one month, the agreement was amended by the builder providing that the possession will be handed over within 42 months with a grace period of 180 days. As per the complainants, no objection could have been raised by them since the builder had already collected a substantial amount of Rs. 48,24,704/-. Further, the builder informed the complainants that the possession was expected to be handed over by 28.08.2018. Despite payment of a sum of Rs. 1,02,99,704/- by the complainants, the builder has failed to hand over the possession of the unit. Several communications were made by the complainant regarding the possession of the unit but no response was received from the builder. The complainants stated that the builder has failed to provide any definite information regarding delivery of the unit even after a lapse of seven years. Hence, a complaint was filed by the complainants before the State Commission alleging deficiency in service and praying for appropriate compensation. Submissions of the builder: The builder submitted that since the interpretation and implementation of the terms of the agreement are contractual in nature, such contractual disputes can be tried by civil courts only. It was further submitted that the complainants have suppressed material facts from the commission since the builder has already completed the construction, obtained occupancy certificate and started offering possession. As per the builder, the delay in completion of construction was due to force majeure events i.e reasons beyond its control and the work was also affected by certain regulatory and judicial orders imposing a ban on construction. Observations of the commission: Issue 1: Whether the commission has the power to decide the complaint or should it be decided by Civil Court The bench relied on Section 2(11) of the Consumer Protection Act, 2019 and observed that since complainants have availed the services of the builder for a consideration and the builder has failed to complete the project, the complainants are entitled to file a complaint before the commission. Reliance was further placed on the decision of the Supreme Court in Narne Construction P. Ltd., etc. v. Union Of India and Ors. (2012) wherein it was held that when a person applies for allotment of a flat and enters into an agreement, the same is covered within the definition of 'service' under the Consumer Protection Act, 2019. The argument of the builder citing force majeure events as the reason for delay was denied by the bench since no concrete documents were placed on record to support the contention. Issue 2: Whether the builder is deficient in providing services to the complainants The bench placed reliance on the decision of the Supreme Court in Arifur Rehman Khan vs DLF Southern Homes Pvt. Ltd & Ors. wherein it was observed that failure to comply with the contractual obligation to provide a flat to the purchaser within the contractual period is 'deficiency in service'. Reliance was also placed on clause 6 (a) of the Addendum to flat-buyer agreement as per which possession was to be offered within 42 months and the builder has miserably failed to offer possession of the unit within the stipulated time. The bench further observed that though the builder has obtained occupancy certificate, the complainant cannot be compelled to accept possession at a belated stage and is entitled for refund. Thus, the builder was held liable for deficiency in service for giving false assurances with respect to the time for handing over possession of the unit and keeping the hard-earned money of the complainants for a long time. Hence, the complaint was allowed with the following reliefs: Refund of Rs. 1,02,99,704/- Rs. 4,00,000 as costs for mental agony Rs. 50,000 as litigation costs Case Title: Shivangi Suri & Anr. vs Capital Heights Pvt Ltd Case Number: Consumer Complaint 205/2021 Date of Decision: 23.07.2025 Click Here To Download Order

Delhi State Commission Holds Capital Heights Liable For Failure To Deliver Possession Of Unit Within Stipulated Time

Aakanksha Bajoria

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