National Consumer Disputes Redressal Commission Holds Greenfield Housing Liable For Deficiency In Service Over Delay In The Delivery Of The Possession Of A Flat, Citing Unsubstantiated Force Majure Clause

The National Consumer Disputes Redressal Commission, presided by AVM J. Rajendra, held that reliance on force majeure while retaining the buyer's deposits constitutes a deficiency of service and also amounts to unfair trade practice. Brief Facts of the Case The complainant saw an ad from Bengal Greenfield Housing Development/developer and booked a flat based on it. The agreement stated that possession would be given within six months, with a grace period. However, possession was delayed by 30 months, and despite the complainant's requests, the developer didn't address the issue. Finally, possession was given, but the complainant claimed compensation of Rs. 90,000 as per the agreement's terms, along with interest, which the developer refused. Being aggrieved, the complainant moved before the District Forum, seeking payment of Rs.90,000 for the 30-month delay at Rs.3,000 per month, compensation of Rs.3,00,000, and litigation costs of Rs.10,000. The district forum dismissed the complaint, stating a lack of substantiation on the complainant's part. The complainant appealed to the State Commission wherein the commission allowed the appeal. The present complaint is a revision petition by the opposite party/developer against the state commission order. Contentions of the Opposite Party The developer argued that they provided a possession letter for the flat in the Ambition project and requested Rs.3,65,696, which the complainant paid, took possession, and expressed satisfaction. They claimed that the complaint was groundless, harassing, and unsustainable because the complainant showed contentment and provided a no-claim certificate. The developer referred to the General Terms and Conditions (GTC) for MIG and LIG apartments they issued, stating that compensation could be paid if they failed to deliver within the specified time, subject to force majeure clauses. The complainant's name was not on the list of MIG flat allottees in the initial phase. They further argued that Clause-11 of the GTC covered force majeure situations, and they explained the circumstances beyond their control for project completion in a letter. The developer contended that the complaint was not valid due to the statutory limitation period under the Act. Observations by the Commission The Commission highlighted the provision in the General Terms and Conditions regarding compensation for delay in possession, stating that the developer is liable to pay compensation to the allottee if possession is not delivered within the agreed-upon timeframe, barring force majeure events. It was noted that the complainant, who had purchased an MIG flat, was entitled to Rs. 3,000 per month for the delay. Despite the developer's claim of force majeure causing the delay, the commission emphasized that the delay was significant and beyond reasonable expectations. The commission referred to the case of Kolkata West International City Pvt. Ltd. Vs. DevasisRudra, II (2019), wherein the court deemed it unreasonably strict to interpret the contract as obligating the buyer to wait indefinitely for possession. Addressing the developer's argument about the delay being due to force majeure and thus not constituting a deficiency in service, the commission referenced a prior case (Sivarama Sarma Jonnalagadda & Anr vs. M/s Maruthi Corporation Limited & Anr) where it was established that the buyer could not be indefinitely made to wait for possession. The commission further stated that the developer's reliance on force majeure while retaining the buyer's deposits not only constituted a deficiency of service but also amounted to an unfair trade practice. It was observed by the commission that the possession of the flat was handed over to the complainant with a delay of 24 months without a justifiable reason. The commission did not find any merit in the revision petition and upheld the state commission's order. The commission directed the developer to pay Rs.72,000 to the Complainant as compensation for the delay of 24 months in handing over the possession of the flat in question, along with a simple interest of 6% per annum from the date of filing the Complaint till final payment.Case Title: Bengal Greenfield Housing Development Ltd. Vs. Suman Bansal Case Number: R.P No. 634/2018 Click Here To Read/Download Order

National Consumer Disputes Redressal Commission Holds Greenfield Housing Liable For Deficiency In Service Over Delay In The Delivery Of The Possession Of A Flat, Citing Unsubstantiated Force Majure Clause

Ayushi Rani

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