Mumbai Consumer Court Orders Rs 45.45 Lakh Refund With 9% Interest To Consumer For Delayed Flat Possession

A district consumer commission has directed M/s Soundlines Eco Homes and its partners to jointly and severally refund Rs 86.37 lakh, including interest, to a homebuyer who was left waiting for possession of his flat in the “Sound Delight” residential project in Panvel. The commission ruled that a developer’s failure to hand over a property within the agreed deadline amounts to a deficiency in service, observing that a flat purchaser “cannot be expected to wait indefinitely” for possession.

The order came on a complaint filed by Mulund resident Tapan Visaria, who had booked a flat in the project. The commission directed the developer to refund the principal amount of Rs 45 lakh along with interest at nine per cent per annum, calculated from December 31, 2016 - the contractual possession deadline - until the amount is actually recovered. The homebuyer was also awarded Rs 75,000 towards litigation costs and mental agony.

However, the commission rejected Visaria’s separate claim for Rs 5.23 lakh towards interest paid on his housing loan, relying on a Supreme Court ruling. It noted that the complainant had independently secured a loan from the State Bank of India and was contractually obligated to repay it with applicable interest.

“The mere fact that the complainant incurred interest expenditure to arrange funds for purchasing the flat does not, by itself, make the opposite parties liable to reimburse that expenditure,” the Commission said while rejecting that head of claim.

Homebuyer Paid Nearly Rs 45.45 Lakh for Flat

Visaria had booked a flat measuring 876 sq ft of carpet area on the third floor of D-Wing in the Sound Delight project at Village Aashte, Taluka Panvel, in Maharashtra’s Raigad district. The property was priced at Rs 50.52 lakh, and the agreement for sale was executed and subsequently registered on August 7, 2015.

According to the complaint, the developer had committed to handing over possession on or before December 31, 2016. However, the deadline was repeatedly extended, with the Maharashtra Real Estate Regulatory Authority (MahaRERA) website subsequently reflecting an extension until September 30, 2026.

The complainant alleged that he had paid approximately Rs 45.45 lakh towards the flat’s consideration. He also paid Rs 1.38 lakh towards VAT, GST and other taxes, Rs 2.53 lakh in stamp duty and Rs 30,000 in registration charges.

Apart from the prolonged delay, Visaria alleged that several amenities advertised in the project brochure were either cancelled or not delivered as promised. These included an entrance gate with a waterfall, a clubhouse, a rooftop shamiyana, an amphitheatre and a children’s play area.

Builder Failed to Explain Delay, Commission Says

The developer firm and its partners failed to appear before the commission despite receiving notices. Consequently, the proceedings continued ex parte under an order dated April 16, 2024.

After examining the evidence submitted by the complainant, the commission noted that the agreement, bank statements, demand letters, email correspondence, photographs and housing loan interest certificate established that the flat had been booked and substantial payments had been made.

“The evidence on record establishes that the opposite parties failed to deliver possession within the agreed period and have not furnished any satisfactory explanation for the delay. Such failure amounts to deficiency in service,” the commission held.