Builders told to pay city man Rs 3.65 crore for not delivering flat

MUMBAI: Sounding a warning to unscrupulous builders, the National Consumer Disputes Redressal Commission has ordered two city developers to pay compensation of Rs3.65

MUMBAI: Sounding a warning to unscrupulous builders, the National Consumer Disputes Redressal Commission has ordered two city developers to pay compensation of Rs3.65 crore to a Bandra resident for failing to handover a ready flat booked by him in 2011.

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The national commission has also ordered Fortune Infrastructure and Zoy Shelcon Private Limited to refund the sum of Rs1.87 crore paid by Trevor D’Lima towards part consideration of the 828.40 sqft flat in Hicons Onyx on Saint Martin Road at Bandra (West).

D’Lima had booked the flat in October 2011 for Rs1.93 crore and had from time-to-time paid Rs1.87 crore towards part payment of the flat. Although the developer – Fortune Infrastructure, formerly Hicon Infrastructure – accepted more than 95% of the total consideration for the flat and issued an allotment letter to the Bandra resident, it did not execute a formal sale deed in his favour.

D’Lima waited for about four years for his dream residence and eventually approached the national commission in July 2015 after noticing that construction had not begun. He contended the developer had breached section 4 of the Maharashtra Ownership of Flats Act 1963, by accepting more than 20% of the sale consideration as advance payment without entering into a written agreement for sale. Although the developer admitted the booking of the flat along with a parking in Hicons Onyx, the developer maintained the project got delayed owing to a change in Development Control Regulations for the city and uncooperative tenants.

The developer expressed inability to complete the project and handover the flat as booked by D’Lima, pointing out that in May 2013 the land owner had entered into another agreement with Hicon Infrastructure and Zoy Shelcon, and under the agreement the rights to redevelop the property in question had been transferred to the latter.

The national commission, however, rejected the developer’s contention. It said once a developer allotted a flat in his proposed project to the complainants, he was under contractual obligation to construct the building and deliver possession of the flat to the complainants. “That having not done so, and the Ops (the developer firms and their partners) now not being in a position to construct the flat, they must necessarily compensate the complainants for the loss suffered by them on account of their failure to perform their contractual obligation,” it added.

The national commission accepted the documentary evidence adduced by the complainant, showing that currently flats are being sold in the locality at the rate of Rs 65,000-Rs75,000 per square feet. Going by the lowest rate, the commission fixed the current estimated price of the flat admeasuring 828 sqft would be around Rs5.48 crore, and therefore directed the developers to refund the amounts accepted from the complainant and also pay the balance amount of Rs3.65 crore as compensation to the Bandra resident.

The national commission has granted six weeks time to the developers to refund the amount of Rs1.87 crore and compensation of Rs3.65 crore, failing which they will also have to shell out interest at the rate of 10% per annum on the outstanding amounts.