The builders who do not give delivery of the flat on time even after promising customers. They are going to be very expensive now. In the recent judgment in the case of Greater Mohali Area Development Authority (GMADA) vs Anupam Garg and others, the Supreme Court clarified that in the event of delay or delivery, the developers will have to refund the basic amount along with interest to the victim’s home buyers. Along with this, the Supreme Court made it clear that the developers cannot be held responsible for paying interest on personal loans taken by buyers for the funding of their homes. In the judgment, the court clarified that developers would have to return the original amount including interest in case of delay or delivery to home buyers.
Also read: Why the anchor was arrested on the panelist’s statement? Supreme Court questioned police while granting bail to Telugu journalist
What was the decision by the consumer court
A bench of Justices Sanjay Karol and Prasanna B. Varale gave the verdict in a controversy arising from GMADA’s ‘East Premium Apartment’ project in Sector 88, Mohali last week. Buyers Anupam Garg and Rajiv Kumar booked 2-BHK flats in 2012 and deposited ₹ 50.46 lakh and ₹ 41.29 lakh respectively. He was promised to hold possession by May 2015 under the letter of intent (LOI), which was also assured of refund with 8% interest in case of delay. Buyers demanded refund in 2016, citing slow progress and large deviations from the promised layouts and facilities. When GMada opposed this, he turned to the Punjab State Consumer Commission.
State Consumer Court verdict
1. Return the amount that was deposited
2. 8 percent annual interest on deposit amount
3. Compensation in lieu of mental harassment
4. Payment of money spent in case
5. GMADA to compensate the interest of bank loan
Also read: Supreme Court refuses to stop Andhra Pradesh’s teacher recruitment exam
The developer has no meaning with where the buyer brought the money from
However, GMADA challenged the instructions of buyers to pay the loan interest in the Supreme Court. In its decision, the court again confirmed that the buyer is entitled to withdraw money with appropriate interest on delayed possession. The bench, citing its earlier decision at the Bangalore Development Authority vs. Syndicate Bank, said that where the Development Authority does not give possession… then the allotte is entitled to withdraw money with appropriate interest. The bench, citing the GDA vs. Balbir Singh case, said that compensation should be different according to the facts of the case. In cases where the funds are being returned … compensation must be compulsorily higher.
Also read: Jharkhand High Court to reconsider the petition of women judicial officer: Top court
Consumer has the right to get compensation
However, the judges refused to pay compensation under several items. DLF Homes Panchkula vs. D.S. Citing Dhanda, he said that when the parties have agreed to pay compensation, there cannot be many items to pay compensation and interest. Justice Karol said that 8% interest was paid. There is compensation to be deprived of investment … No amount of interest could be given on the loan taken by the defendants. The court partially accepted GMada’s appeal – the loan interest component removed, but retained the remaining relief given by the Consumer Commissions. GMada will not have to deposit any additional amount, and the funds already existing with the State Commission will be distributed to the buyers.
