The National Consumer Disputes Redressal Commission, led by Mr. Subhash Chandra and Dr. Sadhna Shanker, ruled that compensation should both reimburse for losses and restore what was lost, with a 9% interest rate deemed reasonable.
Case Summary
The complainant entered into agreements with a developer and landowners to purchase a flat and a car parking space for ₹28,05,000. After paying ₹25,25,000, including ₹25,000 for an electric meter, the complainant found that the developer failed to deliver the property in a habitable condition within the agreed timeframe. Despite the complainant’s readiness to pay the remaining ₹3,05,000, the developer did not fulfill the contract. Consequently, the complainant filed a complaint with the State Commission of West Bengal. The State Commission directed the developer to pay ₹3,00,000 in compensation and ₹10,000 in litigation costs. Dissatisfied, the complainant appealed to the National Commission.
Opposite Party’s Contentions
The developer did not appear at the proceedings, leading to an ex parte decision.
Observations by the National Commission
The National Commission noted that, as per the Supreme Court’s ruling in Fortune Infrastructure Vs Trevor D’ Lima (2018), a buyer cannot be expected to wait indefinitely for possession and is entitled to a refund with compensation for unreasonable delays. In Kolkata West International City Pvt. Ltd. Vs Devasis Rudra (2019), the Court found a seven-year wait unreasonable and justified refund orders. In this case, with a delay exceeding nine years, the complainant sought remedies including defect correction, a refund, and compensation. The developer’s failure to provide possession despite receiving nearly 90% of the payment was deemed a clear deficiency in service. The complainant’s demands for compensation, adjustments, and legal costs were considered fair, given the significant delay and lack of response from the developer. The Supreme Court in Experion Developers Pvt. Ltd. Vs Sushma Ashok Shiroor (2022) affirmed that compensation should be both compensatory and restitutionary, with 9% interest being reasonable.
The National Commission upheld the appeal, directing the developer to deliver possession to the complainant within two months at no extra cost, provide compensation for the delay at a rate of 6% per annum, and pay ₹1 lakh in litigation costs.
Posted and reproduced in Public Interest by
Adv. Sulaiman Bhimani Legal Consultant
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