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Builder’s heirs liable for delayed possession of flats, NCDRC orders handover with compensation
Holding that legal heirs who continue a housing project cannot evade the contractual obligations of a deceased developer, the National Consumer Disputes Redressal Commission (NCDRC) has directed the successors of a city-based builder to hand over possession of two flats in a Sadashiv Peth redevelopment project within six weeks and pay compensation for the delay
Holding that legal heirs who continue a housing project cannot evade the contractual obligations of a deceased developer, the National Consumer Disputes Redressal Commission (NCDRC) has directed the successors of a city-based builder to hand over possession of two flats in a Sadashiv Peth redevelopment project within six weeks and pay compensation for the delay.
In an order dated July 17, a bench comprising presiding member Justice Sudip Ahluwalia and member Sadhna Shanker allowed two consumer complaints filed by Anil Shelke and Neeta Shelke and Shantaram Mazire against Shubhangi Shelke, Sachin Shelke and Disha Thakur over delayed possession of flats in the “Shelke Sadan” project in Sadashiv Peth.
The complaint was filed in 2019 and the money was paid in 2014-15. The builder had promised to give possession of flats in 2015-2016.
The first complaint pertained to a flat for which the buyers had agreed to pay ₹80 lakh and had already paid ₹79.52 lakh. The second concerned flat purchased for ₹87 lakh, of which ₹66.65 lakh had been paid. In both cases, the complainants argued that despite making substantial payments, they were denied lawful possession as the project remained incomplete and the mandatory completion and occupancy certificates had not been obtained within the promised timelines.
The builder’s legal heirs opposed the complaints, contending that the claims were barred by limitation, that civil suits seeking cancellation of the agreements were pending before a Pune court, and that they could not be held liable for payments received by the original developer, Sanjeev Shelke, before his death.
Rejecting these objections, the commission held that a builder’s obligation to obtain statutory approvals and deliver lawful possession is a continuing one.
‘The agreements contemplated delivery of lawful possession after completion of construction and upon obtaining the requisite statutory approvals. Mere expiry of the contractual period does not extinguish the continuing obligation of the builder to complete the project and deliver possession in accordance with law,” the commission observed.
The bench further held that failure to obtain an occupancy certificate constitutes a continuing wrong.
“The failure to deliver lawful possession continued from day to day and constituted a continuing cause of action,” it said, relying on the Supreme Court’s ruling in Samruddhi Co-operative Housing Society Ltd. vs Mumbai Mahalaxmi Construction Pvt Ltd.
The commission also rejected the argument that pending civil litigation barred consumer proceedings, observing that remedies under the Consumer Protection Act are additional to those available under other laws.
Holding that the prolonged delay amounted to deficiency in service, the NCDRC directed the respondents to hand over peaceful, vacant and lawful possession of both flats, along with parking spaces, within six weeks after obtaining the requisite completion or occupancy certificate and executing all necessary conveyance documents. The buyers have been directed to pay the balance consideration simultaneously after adjusting the amounts already paid.
