Mumbai, June 23: The Maharashtra State Consumer Disputes Redressal Commission (SCDRC) has held Navi Mumbai-based M/s Universal Housing & Infrastructure Co. and its Reay Road-based sister concern M/s Universal Construction Co., along with their proprietors, guilty of deficiency in service and unfair trade practices for failing to hand over a promised residential flat and subsequently selling the allotted unit to a third party.
The Commission, presided over by members Poonam Maharshi and Dr Nisha Chavhan, has directed the developers to refund Rs 1.05 crore to the complainants with 10 per cent annual interest from June 29, 2021, the date on which a Memorandum of Understanding (MoU) acknowledging the liability was executed. The builders have also been ordered to pay Rs 50,000 as compensation for mental agony and harassment and Rs 25,000 towards litigation costs.
The Commission further directed the developers to comply with the order within 60 days, failing which the interest rate on the refund amount would stand enhanced to 15 per cent per annum until realisation.
Commission Reprimands Developers
The Commission came down heavily on the builders and reprimanded them for their deficient services. “The complainants have been subjected to an egregious and protracted ordeal spanning over a decade. The opposite parties not only deprived the complainants of their hard-earned life savings but engaged in a systematic pattern of deceit, marked by unfulfilled assurances, the arbitrary shifting of allotments between projects, and the repeated issuance of worthless cheques,” reads the order.
The Commission further noted that the complainants had to repeatedly travel over 150 kilometres from Mangaon to Mumbai to pursue the matter and were met with evasive responses and empty promises.
It also observed that selling the allotted flat to a third party after receiving the entire consideration demonstrated a “high-handed and mala fide approach” amounting to harassment and unjust enrichment.
Background Of The Complaint
The complaint was filed by Mohamed Jalil Abdulla Harnekar, an accountant employed with Kuwait Petroleum International Ltd., and his wife, Asger Shabnam Harnekar, a professor at Mangaon Junior College in Raigad district.
The complaint was lodged against Saquib Shaikh Ahmed Mukadam, Sajid Shaikh Ahmed Mukadam, M/s Universal Housing & Infrastructure Co., and M/s Universal Construction Co.
According to the complaint, the couple booked a 660 sq ft flat in a proposed residential project at Dongri in 2013 for Rs 60 lakh and paid Rs 40 lakh towards the purchase. The developers allegedly assured that construction would commence shortly and possession would be delivered within 36 months. However, the project never took off.
The complainants were later persuaded to shift their investment to another project, “Bay View” at Mazgaon, where they eventually paid the entire agreed consideration of Rs 90 lakh by 2018.
Despite receiving the full sale consideration, the developers neither executed a registered agreement for sale nor handed over possession of the flat. The couple later discovered that the flat allotted to them had been transferred to a third party.
Developers Acknowledged Liability
The Commission noted that the developers repeatedly acknowledged their liability through letters, undertakings, memorandums of understanding and a series of cheques, many of which were dishonoured due to insufficient funds.
In a 2021 MoU, the developers admitted liability of Rs 1.25 crore. After adjusting a subsequent payment of Rs 20 lakh, the outstanding amount remained Rs 1.05 crore.
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Holding that acceptance of the full sale consideration, failure to execute statutory agreements, non-delivery of possession, transfer of the allotted flat to a third party and issuance of dishonoured cheques constituted serious deficiency in service and unfair trade practices, the Commission ruled in favour of the complainants.
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