Lawstreet Journal

Fine to be levied on the builder when he is unable to deliver the possession of house/flat on time: Supreme Court

Lawstreet Journal 16 Jan 2021 12:30am

Image courtesy: Lawstreet Journal Judiciary Fine to be levied on the builder when he is unable to deliver the possession of house/flat on time: Supreme Court

In a recent verdict, the apex court has held that that the flat buyers are entitled to compensation for “delayed handing over of possession” and for the failure of the developer to fulfill their promises with regard to amenities. The bench said the flat owners are entitled to the compensation in excess of the amount stipulated in their agreements with the developers.

A bench of Justice Uday Umesh Lalit & Justice Indu Malhotra made it clear in its judgment that:

“The unilateral agreement & arbitrariness of the builder will no longer work because when the home buyer is not able to pay installments or arrears, the builder imposes a fine on him that he is obliged to pay, so why no fine on the builder when he is unable to deliver the possession of house/flat on time?”

The top court set aside the verdict of the National Consumer Disputes Redressal Commission (NCDRC) which, on July 2, 2019, had dismissed the complaints of 339 flat buyers by holding that they were not entitled to the compensation in excess of what was stipulated in their flat purchase agreements for delayed possession and the lack of assured amenities.

The bench thus held that the flat owners are entitled to the compensation in excess of the amount stipulated in their agreements with the developers.

“The compensation amount shall be computed on the total money paid towards the purchase of the respective flats with effect from the date of expiry of thirty-six months from the execution of the respective flat purchase… Continue Reading...


Tagged: Supreme Court of India  
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