The Supreme Court of India recently delivered a significant judgement in the case of DLF Homes Panchkula v. Disgruntled Allottees. The case revolves around issues of delayed possession and compensation for the allottees in the DLF Valley project in Sector 3, Kalka-Pinjore Urban Complex, Panchkula, Haryana. The judgement addresses concerns raised by the allottees regarding incomplete buildings, maintenance works, and the payment of interest. Let’s delve into the details of this crucial legal battle.
Facts
- DLF Homes Panchkula filed appeals against orders passed by NCDRC on 24.10.2018 & 12.12.2018.
- Appeals were regarding delay in possession of flats and compensation for the delay.
- The construction delay was attributed to a stay granted by the Court from 19.04.2012 to 12.12.2012.
- Appellant requested extension for possession handover in 2013.
- The possession of some units was complete with occupation certificates received.
- A similar dispute for the same project was also before the Court in another case.
- Directions were given by NCDRC regarding interest rate and refund options.
- SCDRC had initially directed the Appellant to hand over possession of units to Complainants.
- Appellant appealed against SCDRC’s order in NCDRC.
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Arguments
- Certain allottees are not taking possession to earn interest at 9% per annum, which is more than the contractual compensation of Rs.10 per sq. ft. per month for delayed possession.
- Loss of rent per month is pleaded by allottees like D.S. Dhanda, Sandeep Malik, Bijender Singh Sangwan, Kanwal Mohan.
- Some allottees intentionally avoid taking possession to continue earning interest under the guise that the Appellant is not handing over possession.
- Learned Senior Counsel for the Appellant argues that consumer complaints should be decided based on Court orders in cases of delay in possession and refund sought by complainants.
- Interest payment of 9% is payable till two months after the offer of possession, according to the chart in Sushila Devi’s case.
- The Appellant agreed to deliver constructed flats but will only hand over possession after obtaining an occupancy certificate from the Town and Country Planning Department of the State of Haryana.
- Maintenance works are to be taken care of by Jones Lang LaSalle, an international real estate maintenance agency.
- The allottees argue that they are being offered possession of incomplete buildings and are entitled to compensation for mental agony and litigation expenses as awarded by SCDRC and modified by NCDRC.
- The Appellant offered 1775 flats in DLF Valley project in Sector 3, Kalka-Pinjore Urban Complex, Panchkula, Haryana.
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Analysis
- A person deprived of use of money to which he is legitimately entitled has a right to be compensated for the deprivation, which may be called interest, compensation, or damages.
- The amount of interest serves as compensation to the beneficiary deprived of the use of the investment made by the complainant.
- The awarding of compensation by NCDRC or SCDRC lacks foundation as no principles recognized judicially have been laid down by the complainant, and it is done by rule of thumb.
- The grant of compensation under various heads by NCDRC is not sustainable as it lacks proper grounding.
- The case of Secretary, Irrigation Department, Government of Orissa & Others vs G.C. Roy delved into whether an arbitrator has the power to award interest pendente lite.
- Interest awarded will take into account the consequences of delay in not handing over possession.
- Awarding compensation under various heads for the same default is not sustainable.
- The learned State Consumer Disputes Redressal Commission (SCDRC) and National Consumer Disputes Redressal Commission (NCDRC) both awarded compensation under different heads for the singular default of not handing over possession.
- Complainant entitled to interest from Appellant for not handing over possession as projected
- Special punitive damages not awarded as one cause of late possession delivery was beyond Appellant’s control
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Decision
- Grant of interest at the rate of 15% by SCDRC deemed excessive.
- Amount of refund to be paid to the Complainants within two months along with costs.
- Appeal filed by the Appellant before NCDRC dismissed for non-compliance of an order in an application for condonation of delay.
- Appellant directed to send a copy of the occupation certificate to the Complainants along with the offer of possession.
- Appellant instructed to engage Jones Lang LaSalle for maintenance works due to non-occupation of flats after construction.
- Complainants allowed to seek assistance of maintenance agency for maintenance work arising from non-occupation or natural vagaries.
- Costs of Rs. 35,000 imposed by SCDRC to be maintained.
- Interest payable from date of expiry of three years from the agreement or date of transfer, whichever is later, in case of any transfer of the flat.
- In case of transfer, the transferee entitled to interest at 9% per annum from date of expiry of three years from agreement or date of transfer, whichever is later.
- Complainant not entitled to any other amount over and above the mentioned amount.
- Interest rate modified to 9% per annum from date of deposit till date of refund.
- Complainants entitled to consolidated amount of Rs. 50,000 in each complaint for mental agony and litigation expenses.
- Appellant directed to complete maintenance work within two months of the offer of possession, with interest at 9% per annum for two months from offer of possession in all situations.
Case Title: DLF HOMES PANCHKULA PVT. LTD. Vs. D.S. DHANDA ETC. ETC.
Case Number: C.A. No.-004910-004941 / 2019
