Mumbai, Feb 13: The State Consumer Disputes Redressal Commission has penalised a Navi Mumbai-based developer, M/s Hitect Enterprises, a partnership firm of Brijesh Mavani, for failing to hand over possession of a flat booked in 2011.
The Commission directed the developer to hand over peaceful possession of the flat within one month. It further ordered the proprietor to pay interest at 8 per cent per annum on the amount of Rs 31,64,065 for the period between January 2014 and October 2016.
Additionally, the developer has been directed to pay Rs 2 lakh towards compensation for mental agony and physical harassment, along with Rs 25,000 towards litigation costs.
Complaint and booking details
The complaint was filed by Rajesh Prasad (49), a Thane-based resident, who had booked Flat No. 904 on the 9th floor in the project “Hi-Tech Castle” at Sector-17, Ulwe, Navi Mumbai. The case was represented by advocate Poonam Makhijani on Rajesh Prasad’s behalf.
According to the complainants, in January 2011 they approached the developer based on brochures, representations and assurances regarding development rights, approvals, commencement of work, amenities, connectivity and possession timelines. The flat, admeasuring 543 sq ft carpet area with terrace, was agreed to be purchased for Rs 44,28,970.
The complainants alleged that the price included a cash component of Rs 10,19,050 towards development charges, society formation, amenities, utility connections, taxes, legal charges, parking, clubhouse, grills and proportionate outgoings.
They claimed that the developer assured that construction would commence in February 2011 and possession would be handed over by November 2013. Payments were made from time to time through cheques and cash, supported by receipts and acknowledgments, totalling Rs 40,99,101 — approximately 93 per cent of the consideration — including service tax of Rs 84,014.
An Agreement for Sale dated January 17, 2012 was registered. However, the complainants alleged that the developer deliberately kept the possession date blank in the agreement and failed to acknowledge the cash component.
Limitation plea rejected
The developer contended that the complaint filed in 2017 was barred by limitation under Section 24A of the Consumer Protection Act, arguing that the cause of action arose in January 2011.
Rejecting this contention, the Commission observed: “The Agreement for Sale did not specify a possession date, and the project obtained Occupancy Certificate only on 29.09.2016, and an offer of possession was issued on 01.10.2016. Thus, the relevant cause of action cannot be computed from the date of booking, because the obligation to deliver possession is a continuing obligation. As the possession is not handed over, the cause of action is continuous and recurring.”
The Commission held that since the complaint was filed within two years from the date of Occupancy Certificate and possession offer, it was within limitation.
Findings on delay and violation
The Commission noted that construction commenced late and the Occupancy Certificate was obtained only in 2016 — nearly five years after booking. Citing Section 3(2)(f) of the Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963 (MOFA), the Commission observed that a promoter is required to specify in writing the date by which possession is to be handed over. Keeping the possession date blank was held to be in violation of MOFA.
It further held that even if the agreement is silent, a builder is obligated to complete construction within a reasonable period. A delay of nearly five years was held to be unreasonable, particularly when assurances of earlier possession remained unrebutted.
The developer argued that Rs 3,29,869 remained unpaid and that possession was withheld solely for this reason. While the Commission acknowledged the outstanding amount, it held that non-payment of the balance consideration does not extinguish the promoter’s liability for delay.
The Commission concluded that the promoter had committed deficiency in service under Section 2(1)(g) of the Consumer Protection Act.
Unauthorised terrace construction
The complainants further alleged that the open terrace attached to their flat had been covered by construction carried out for the flat above, contrary to sanctioned plans.
Upon approaching CIDCO under the RTI Act, they received a reply dated April 25, 2017 confirming that no alteration in plans had been permitted and that the Occupancy Certificate was issued strictly on the basis of the original Commencement Certificate dated May 13, 2011.
Also Watch:
The Commission noted that CIDCO’s inspection report and notices established that the terrace was covered without approval and contrary to sanctioned plans. Under the MRTP Act, such unauthorised construction is liable to removal. Holding the developer guilty of deficiency in service and delay, the Commission granted relief in favour of the complainant.
To get details on exclusive and budget-friendly property deals in Mumbai & surrounding regions, do visit: https://budgetproperties.in/
