Thane Builder Held Guilty Of Unfair Trade Practice After 14-Year Delay In Handing Over Flat

Thane, June 20: The Maharashtra State Consumer Disputes Redressal Commission has held Thane-based Ashwamedh Builders & Developers and its partner, Haresh Daulatani, guilty of deficiency in service and unfair trade practice for failing to hand over possession of a flat for nearly 14 years despite receiving substantial payments from the purchasers.

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The complainants, Sanjay Sharad Damle and Snehal Sanjay Damle, had booked a flat in the builder’s “Atlantis” project at Panchpakhadi, Thane, in 2010 for a consideration of Rs 31.21 lakh.

According to the agreement for sale, possession was to be handed over by October 2012. The complainants had paid Rs 25.97 lakh towards the purchase price and also incurred stamp duty and registration expenses.

The buyers alleged that despite repeated follow-ups, construction remained incomplete and possession was never delivered. They also challenged a subsequent demand of Rs 8.28 lakh raised by the builder as an escalation charge, contending that it was outside the scope of the registered agreement.

Builder cites legal and regulatory hurdles

In its defence, the builder attributed the delay to litigation, regulatory hurdles and disputes involving approvals from the Thane Municipal Corporation and other authorities.

The developer argued that the project, which originated as a slum redevelopment scheme, faced prolonged legal battles and administrative delays beyond its control. The builder also claimed entitlement to recover additional costs incurred during the project.

However, the commission rejected these contentions. It observed that a builder accepting bookings and advance payments has a duty to ensure that the project is free from legal complications and necessary sanctions are in place. The commission held that purchasers cannot be made to wait indefinitely because of legal issues faced by the developer.

Commission finds unfair trade practice

The bench comprising President Justice S.P. Tavade and Member Vijay C. Premchandani noted that the builder had admitted that possession had not been handed over.

It further found that the demand for over Rs 8 lakh as an escalated price amounted to an unfair trade practice, while the prolonged delay constituted a clear deficiency in service under the Consumer Protection Act, 1986.

Allowing the complaint partly, the commission directed the complainants to pay the balance sale consideration, following which the builder must hand over lawful possession of the flat with all promised amenities within four weeks.

Alternatively, if the complainants choose not to accept possession, the builder has been directed to pay them Rs 51.97 lakh, representing the market value of a similar flat in the locality, along with interest at 9% per annum on the amount of Rs 25.97 lakh from October 1, 2012, until realisation.

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The commission also awarded Rs 5 lakh as compensation for mental harassment and Rs 25,000 towards litigation costs, noting that the buyers had suffered financial loss and hardship after waiting years for possession while continuing to service a housing loan.

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