Failure to build, hand over flat costs Navi Mumbai developer Rs. 59 lakh

  • Kanchan Chaudhari, Hindustan Times, Mumbai
  • Updated: Sep 11, 2014 20:32 IST

Failure to complete and handover possession of a duplex flat at CBD Belapur has cost a Navi Mumbai-based developer dearly.

The Maharashtra state consumer commission, on Tuesday, asked Atul Realty Private Limited to pay a sum of Rs. 59.04 lakh to a Kandivli resident, who booked the flat – in a building project being developed by the firm – 16 years ago for a total consideration of Rs. 13.06 lakh.

The commission directed the developer to refund Rs. 12.07 lakh paid by EP Ramchandran, along with interest at the rate of 24% per annum from March 1998, when he filed the consumer complaint. The developer has also been directed to pay Ramchandran an additional sum of Rs. 60,000 towards compensation and litigation cost.

According to his complaint, Ramchandran had booked a duplex flat on the eleventh and twelfth floors in a building proposed by the firm.

Initially he paid a booking amount of Rs. 10,000, and by March 1996, he had paid a total amount of Rs. 12.07 lakh to the developer. In December 1997, the developer told Ramchandran his booking had been shifted to another project where construction work had already started. Ramchandran, however, did not approve of the shifting and in 1998 approached the consumer commission.

The developer denied all the allegations. The developer contended the complainant had failed to pay further instalments and therefore had no right to claim compensation and interest on the amount paid by him. The developer claimed he was not able to complete the project because of unilateral cancellation of the plot’s allotment by City and Industrial Development Corporation and there was no deficiency on his part.

The consumer commission, however, noted that in one of the letters addressed to flat purchasers, the developer had clearly mentioned he would refund the money paid by them, along with simple interest at 24% per annum if the project is abandoned because of lack of approval to the allotment from the state government.

The commission noted the complainant was entitled to the same interest. It granted token compensation of Rs. 50,000 to the complainant after finding that now he would not be able to purchase a duplex flat anywhere in and around Mumbai with the same amount.

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