Mohali plots: NCDRC says unscrupulous builders should not be spared, penalises Emaar MGF Land

Written by PTI | New Delhi | Updated: Jul 30 2014, 01:01am hrs
Emaar MGFNDCRC also imposed punitive damages of Rs five lakh on the builder Emaar MGF Land Ltd. (Thinkstock)
The apex consumer commission has dismissed an appeal filed by a real estate developer against a direction to pay nearly Rs 65 lakh to two persons who had jointly booked a plot in its project, saying "unscrupulous" builders who take to litigation "to cover up their faults" should not be spared.

A bench of National Consumer Disputes Redressal Commission (NDCRC), also imposed punitive damages of Rs five lakh on the builder Emaar MGF Land Ltd, out of which Rs 2.5 lakh would be given to the buyer as compensation and Rs 2.5 lakh to be deposited in Consumer Legal Aid Account of the commission.

The bench pulled up the builder for filing an appeal against Chandigarh State Consumer Commission order and said it was well settled that no leniency should be shown to such type of litigants who in order to cover up their own fault and negligence, go on filing meritless appeal in different foras.

"Unscrupulous builders like appellants who after taking almost the entire cost of the plot, do not perform their part of obligation, should not be spared. A strong message is required to be sent to such type of builders that this Commission is not helpless in such type of matters," a bench presided by Justice V B Gupta said.

The bench passed the order on the appeal of the builder challenging the state commission's decision of directing it to refund Rs 62,60,750 to the complainants along with interest, to pay Rs two lakh compensation for causing mental agony and physical harassment to them and a cost of Rs 20,000 to them.

A complaint was filed by Chandigarh residents Karnail Singh and his son Harmeek Singh, submitting that they had booked a plot in the builder's 'Mohali Plots at Mohali Hills' project in Sector 104, Mohali by paying a booking amount of Rs five lakh on February 12, 2011.

The builder had assured them that development activity at the site was in full swing and if they booked the plot, the possession would be given to them within 18 months from the date of execution of the Plot Buyer's Agreement, it said.

It said the basic price of the plot was Rs 55 lakh and apart from this, the buyer had to pay Rs 6,87,500 towards Preferential Location Charges (PLC) plus additional charges.

After some discount, Singhs had to pay Rs 65,30,250 towards the plot.

After taking a loan from a bank, Singhs paid Rs 62,60,750 i.e. about 95 per cent of the sale consideration to the builder while the remaining five per cent amount was to be paid at the time of getting physical possession of the plot, the complaint said.

It said when the builder failed to give the possession of the plot by the stipulated date i.e. May 21, 2013, Singhs visited the site and found that there was no development in the area, in which the plot was allotted.

The builder, in its defence, contended before the tribunal that development activities in the Sector in which the plot was allotted were in full swing and delivery of physical possession of plots was likely to be given in the near future, at the most by middle of 2014.

The builder claimed that neither there was any deficiency in rendering service on its part nor did it indulge in unfair trade practice.

The NCDRC bench, however, said the builders were not sure as to by which date they will be able to give the possession of the plot to the complainants and after grabbing 95 per cent of cost of plot, they are sitting over it.

"Moreover, the appellants (builder) by not delivering the legal physical possession of the fully developed plot to the respondents (Singhs) till date, even after having received more than 95 per cent of the price thereof, are not only deficient in rendering service but are also guilty of indulging into unfair trade practice," it said.

It added that such type of unscrupulous act on the part of builders should be dealt with heavy hands as after grabbing the money from the purchasers, they enjoy and utilise their money but donot hand over the plot on one pretext or the other.