Using Poor Quality Material During Construction: NCDRC Holds Builder Liable For Deficiency In Service

The National Consumer Disputes Redressal Commission, presided by AVM J. Rajendra, held that usage of subpar resources for construction amounts to deficiency in service. Brief Facts of the Case The complainant approached the builder to build a flat at a rate agreed per square foot. On such terms, he advanced six installments aggregating Rs. 12.25 lakhs. Much thereafter, the builder would again call for Rs.2 lakhs, citing the reason that the ground floor slab is completed. However, upon inspection, it was found that the job was not only incomplete but also of poor quality-including the use of poor materials, construction defects and deviations from the approved plan. An expert estimated that the value of the job done, including the value of the land, would work out to Rs. 3.9 lakhs, with an excess paid to the builder to the tune of Rs. 8.35 lakhs. Due to poor workmanship and financial discrepancies, the complainant lost trust in the builder. The complainant filed a complaint before the District Forum, seeking a refund of Rs. 8.35 lakhs, along with interest, compensation, and costs. The District Forum allowed the complaint and directed the complainant to deposit the balance amount. It further directed the builder to perform the remaining work as per the agreement and to pay Rs. 10,000 as litigation costs; on failure, it directed the builder to pay the amount along with Rs.5,00,000 as compensation. Not satisfied, the complainant appealed before the State Commission of Kerala which allowed the appeal. The State Commission reversed the District Commission's order and directed the builder to Rs.8.35 lakhs collected in excess at 8% interest , along with Rs. 10,000 as litigation costs. Aggrieved, the builder filed a revision petition before the National Commission. Contentions of the builder The builder admitted to the agreement but contended that the complainant defaulted in payments that caused a delay in construction. The builder relied on the clause in the agreement whereby in case of non-payment, the builder can halt the construction work. It was argued that the complainant still owed Rs. 2,25,650, which formed part of the total construction cost of Rs. 14,80,650, and the builder pleaded that there was no deficiency in service. Observations by the National Commission The National Commission observed that the key issues to address are whether the builder used substandard materials, had the right to halt construction due to payment delays, and if the complainant was owed a refund for excess payments. The claimed poor quality materials and deviations from the plan, but the builder argued that the complainant oversaw the construction and never raised concerns during the process, making these claims unsubstantiated. Regarding payment delays, the builder stated that the complainant failed to pay on time, which caused construction delays, and as per the agreement, the builder had the right to suspend work. The complainant claimed that he was overpaid, but the builder argued that the total cost was more than what the complainant paid. The National Commission found a deficiency in service and ordered the builder to refund the excess payment with interest. The builder appealed, but after considering all factors, the commission concluded that the compensation awarded by the State Commission was excessive and reduced it to Rs.5,00,000, payable within a month, with interest for any delay. Case Title: Abdul Gagoor Vs. Jose K.V Case Number: R.P. No. 1302/2019 Click Here To Read/Download The order

Using Poor Quality Material During Construction: NCDRC Holds Builder Liable For Deficiency In Service

Ayushi Rani

Tags