This blog focuses on the detailed legal analysis conducted by the court regarding the possession delivery period and refund in a real estate case. The judgment provides insights into the factors affecting possession timelines, including the granting of Fire NOC as the starting point for possession calculations. The court’s decision emphasizes the importance of honoring contractual obligations and upholding consumer rights in the real estate sector.
Facts
- The first respondent filed a booking application for an apartment in the Project on 22 December 2010.
- The appellant failed to deliver possession of the apartment within six months, leading to a refund request of the principal amount of Rs 2,23,91,480 with interest at 18% per annum.
- The Project was advertised to offer state-of-the-art facilities like home automation devices, Wi-Fi, and high-end video door security systems in each apartment.
- The apartment offered for possession was incomplete and not in a habitable condition.
- An Apartment Buyers Agreement was entered into on 14 February 2012 between the appellant and the first respondent.
- The Building Plans for the Project were approved by the Directorate of Town and Country Planning, Haryana on 27 September 2011, subject to certain conditions.
- A consumer complaint was filed by the first respondent before the NCDRC on 3 May 2017 due to the delayed handover of the apartment.
- The CMC Gurgaon granted approval on 25 September 2013 for the Fire Fighting Scheme for the Project.
- Occupation Certificates were issued for Tower D on 26 August 2016 and Tower B on 14 September 2017 in respect of the Project.
- Appellant did not contest that an amount of Rs 2,23,91,480 had been paid by the first respondent.
- NCDRC rejected developer’s submission in Shamshul Hoda Khan case regarding the Haryana Fire Service Act 2009.
- Court upheld NCDRC’s decision in Siddharth Vasisht case by relying on its earlier rejection of appeal against Shamshul Hoda Khan case.
- NCDRC ordered a refund of Rs 2,23,91,480 with 10.25% per annum interest rate to the first respondent, considering them a consumer under COPRA.
- NCDRC rejected appellant’s argument related to the calculation of possession period in Siddharth Vasisht case.
- Court upheld NCDRC’s decision in Siddharth Vasisht case regarding construction commencement before Fire NOC grant affecting possession delivery period.
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Arguments
- Contractual date for handing over possession, including the 180 days’ grace period, was 24 September 2017.
- Offer of possession was made by the appellant on 25 September 2017.
- Delivery of possession starts from the date the Fire NOC is granted, as per the judgment in IREO Grace Realtech Private Limited v. Abhishek Khanna and Others.
- Request for refund with interest was not warranted as the primary relief sought was possession of the flat.
- Refund prayer was only in the alternate to possession not being available.
- Appellant offered possession within the contractual period, hence no basis for ordering a refund.
- Building Plan sanctioned on 27 September 2011 required a Fire NOC, which was obtained on 25 September 2013.
- Clause 13.3 of the ABA stated possession to be handed over within forty-two months after pre-conditions were fulfilled, with a 180-day grace period.
- The first respondent filed an interim application before the NCDRC for the delivery of possession.
- The NCDRC directed the appellant to deliver possession within a month of payment of outstanding dues.
- The appellant, in an email on 25 September 2018, cited limited workforce as a reason for slow finishing work at the site.
- The email mentioned the expectation of resuming work at full force in the near future for completing the project and handover.
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Analysis
- The appellant was unable to comply with the interim order of the NCDRC for handing over possession of the apartment.
- The date for the delivery of possession started when the Fire NOC was issued, not from the date mentioned by the appellant.
- The appellant issued a notice of possession after the specified date of possession.
- The amenities promised by the appellant were not provided as per the NCDRC’s findings.
- The appellant’s construction of the project began before obtaining the necessary Fire NOC.
- The appellant was unable to hand over possession even after an interim order was passed directing them to do so.
- The appellant sought possession first before the first respondent filed a complaint seeking a refund or possession of the apartment.
- The NCDRC found that promised amenities were not provided in the project and apartment.
- The period for delivery of possession of the apartment ended by a specific date which was not met by the appellant.
- Allottees who had received possession and Occupation Certificates were required to take possession and could not terminate the Agreement to Buy Apartment (ABA).
- The primary relief sought by the appellant was the handing over of possession of the allotted flat under the ABA.
- The NCDRC’s order for a refund at the appropriate interest rate was justified given the circumstances.
- In Abhishek Khanna (supra), the Court analyzed provisions of the HFS Act and specific clauses of the ABA.
- Clause 13.3 of the ABA, similar to the one in this case, tied possession delivery period to the date of approval of Building Plans or fulfillment of preconditions.
- Clauses 3 and 17(iv) of the sanctioned Building Approval were found to be identical to clauses in the present case.
- The Court concluded that the possession delivery period would initiate only upon the granting of the Fire NOC.
- The position in the present case is distinguishable from the facts in Abhishek Khanna case
- The judgment of the NCDRC is affirmed
- Detailed reasons were provided in the judgment for the affirmation
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Decision
- The appellant made a solemn representation to the flat buyer regarding the amenities provided in the flat and the Project.
- The National Consumer Disputes Redressal Commission (NCDRC) directed the appellant to refund the principal amount to the first respondent with interest.
- The first respondent was allotted an apartment in Tower D of the Project.
- The appellant issued a notice of possession on September 6, 2016.
- The direction for the refund of the amount paid together with interest was upheld.
Case Title: M/S IREO PVT. LIMITED Vs. ALOKE ANAND (2022 INSC 82)
Case Number: C.A. No.-000180 / 2022
