The Supreme Court recently ruled in favor of a homebuyer, Venkataraman Krishnamurthy, directing the prominent real estate developer Lodha Group to refund INR 2.25 crore with a 12% per annum interest. This decision stems from alleged delays in delivering possession of a Mumbai apartment purchased in 2013. Despite the National Consumer Disputes Redressal Commission's earlier order for possession within three months and a 6% per annum interest compensation, the Supreme Court overturned this ruling, emphasizing contractual obligations. The verdict highlights the significance of adhering to legal frameworks in resolving disputes, reinforcing consumer protection and contractual integrity in real estate transactions.
In a recent judgment, the Supreme Court has ordered Lodha Group, a prominent real estate developer to comply with a refund order. The Court has directed Lodha Crown Buildmart to refund INR 2.25 crore to a homebuyer in 12 months, along with simple interest of 12% per annum. The refund is over alleged delay in handing over possession of a 1,966-sq ft apartment bought in November 2013 in Mumbai.
Venkataraman Krishnamurthy purchased the 4-BHK apartment for INR 7.55 crore in the Lodha Evoq project in New Cuffe Parade at Wadala, Mumbai. As per the payment schedule, homebuyer had paid INR 2.25 crore and the balance INR 5.83 crore was to be paid on initiation of fit-outs.
The agreement between Krishnamurthy and the developer stipulated that possession of the apartment for fit-outs should have been delivered by June 30, 2016, with a grace period extending to June 30, 2017. However, alleging a failure on the developer's part to meet this deadline, Krishnamurthy terminated the agreement.
The homebuyer approached the National Consumer Disputes Redressal Commission (NCDRC) and prayed for refund of the amount paid with compound interest thereon at 18% per year along with compensation for the harassment, mental agony and torture suffered by them, apart from litigation costs.
The NCDRC in November 9, 2022, disposed of the homebuyers’ consumer complaint and ordered the developer to deliver the actual physical possession of the unit in question within three months.
The NCDRC ordered that the developer shall pay delay compensation in the form of simple interest at 6% per annum on the total amount paid from the committed date of possession, June 30, 2016 till the date of offer of possession, November 29, 2017. Additionally, rejecting the claim of refund by the homebuyer, the NCDRC noted that there was "some delay" in handing over possession of the apartment by the developer, but said that it was not "unreasonable", whereby the homebuyer could cancel the agreement and seek a refund.
Following this, the homebuyer approached the Supreme Court, challenging the NCDRC order. The SC on February 22 said that Clause 11.3 of the agreement makes it clear that delay in delivery of possession of the apartment for fit-outs would result in the developer having to inform the purchaser within 30 days of the expiry of the grace period, the revised date by which the unit was likely to be ready for being offered for possession for fit-outs and if the same is accepted by the purchaser, the contract would stand extended.
The Supreme Court, upon reviewing the case, overturned the NCDRC's order and ruled in favour of the petitioner. The Supreme Court's verdict requires the Lodha Group to refund the deposited amount of INR 2.25 crore within 12 months, starting from April 5, 2024, with simple interest at 12 percent per annum. This judgment underscores the importance of upholding contractual agreements and respecting legal boundaries in dispute resolution processes.
Advertisement
Facebook
Whatsapp
