Mumbai Developer Ordered To Pay ₹6.64 Lakh Each To Flat Owners Over Shortfall In Carpet Area

Mumbai: The State Consumer Dispute Redressal Commission (SCDRC) has pulled up Sion-based developer Chinnappan Anthony, proprietor of M/s Milan Builders and Developers, for handing over less carpet area than promised in two separate flats booked by a father-son duo. The Commission, in both cases, directed the developer to pay ₹6,64,640 to the flat owners for the shortfall in the actual carpet area. The developer has also been directed to pay the amount with nine per cent interest from the date of filing of the complaints. In addition, the Commission directed the developer to pay ₹50,000 to both complainants towards mental agony and ₹25,000 towards their individual litigation costs.

Consumer commission rules against developer

The order was passed on September 4, 2026, by a bench comprising Presiding Member Poonam V. Maharshi and Member Dr Nisha Amol Chavhan in complaints filed by Sujt Murleedharan Nair and T. Muraleedharan Nair, both residents of Kandivali.

According to the complaints, the father-son duo had entered into registered Agreements for Sale on January 11, 2016, for Flat Nos. 202 and 302 in Shree Balaji Ashirwad, Malad (West), respectively, with the developer agreeing to provide 560 sq ft of carpet area. Possession was handed over in November 2016.

After taking possession, the Nairs had the flats measured by a registered architect, who found the actual carpet area to be 518.46 sq ft, resulting in a shortfall of 41.54 sq ft. The complainants calculated the loss at ₹6.64 lakh based on the prevailing rate of ₹16,000 per sq ft.

Allegations over building facilities

The complainants also alleged that the building had received only a Part Occupation Certificate (OC) and that the developer had failed to form a co-operative housing society. They claimed that the ground-floor stilt parking had been converted into an office and that a health club/common area promised on the first floor had instead been converted into flats and sold.

The developer disputed the complaints and argued that the Nairs were not “consumers” but landowners who had entered into a development arrangement with the builder. It also alleged fraud in relation to the agreements and claimed that the complainants had outstanding financial and other obligations. The developer further disputed the architect’s measurement and called the claim of deficient area false.

Commission finds deficiency in service

“The collateral contentions raised by the opposite parties alleging fraud under the separate Memorandum of Understanding (MoU), unauthorised short-term rentals pending financial accounts are independent contractual disputes that must be agitated before the competent civil court, and neither dilute the complainant’s status as a consumer nor absolve the developers of their statutory duties to deliver the exact promised area, regularise the building’s title and form the society. Consequently, as the complainant has been forced to reside in a regularised property with depleted dimensions for nearly a decade, he is legally entitled to monetary compensation for the structural shortfall, direct mandates compelling the execution of full occupancy certificate and society registration, as well as just punitive damages for the profound mental agony and legal expenses incurred. …It is clear that the developer is guilty of deficiency (in services),” the Commission held in its orders.

The Commission rejected the developer’s contention that Nair was merely a vendor. It held that where a landowner receives a constructed apartment as consideration under a development arrangement, the developer is providing construction services, making the landowner a consumer in respect of structural deficiencies and statutory non-compliance.

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Compensation awarded to flat owners

On limitation, the Commission held that the developer’s obligation to obtain a complete OC and form a housing society was continuing in nature. Therefore, the cause of action continued as long as these statutory obligations remained unfulfilled, and the developer could not succeed on its plea that the complaint was time-barred.

On the carpet-area dispute, the Commission noted that the developer had not produced any independent expert measurement to counter the registered architect’s report. It held that reducing the agreed carpet area without a corresponding reduction in consideration or the purchaser’s written consent amounted to a deficiency in service and an unfair trade practice.

Advocate Dharmendra Jitendra Damani appeared on behalf of the complainants in the case.

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