The Supreme Court has upheld the order of the National Consumer Disputes Redressal Commission (NCDRC), directing a developer to refund the entire amount paid by home buyers for the delayed possession of their flat. The home buyers had booked a 3BHK flat in the 'Parsvnath Paramount' project in 2008, but the developer failed to hand over the possession within the agreed timeframe of 30 months. The NCDRC had initially ordered the developer to refund the amount with 9% interest per annum, but the home buyers challenged this decision. The Supreme Court has now increased the interest rate to 12% per annum, stating that the home buyers had to suffer for a long time without any fault of their own and the agreement mentions that the developer would be a 12% interest on the amount in case of delay.
The Supreme Court has upheld the order of the National Consumer Disputes Redressal Commission (NCDRC), which directed a developer to refund the entire amount paid by the home buyers for the delayed possession of their flat.
According to the complaint, the developer had launched a group housing project called 'Parsvnath Paramount' in Subhash Nagar in 2008. The home buyers had booked a 3BHK flat in the project and paid around INR 16 lakh as the initial amount on July 15, 2008, with the rest of the payment made as per the agreed plan.
The flat-buyer agreement stipulated that the construction of the flat would be completed within 30 months of the commencement of construction of the particular tower, with an additional grace period of 6 months. However, despite the home buyers' timely payments, the developer failed to hand over possession of the flat within the expected deadline. The home buyers made several attempts to contact the developer to inquire about the project's progress but received no substantial updates.
Aggrieved by the delayed possession, the home buyers approached the NCDRC, seeking a refund of the entire amount paid by them at the current market value, along with interest at the rate of 24% per annum from the date of booking the flat until the date of payment, as well as compensation.
The NCDRC had directed the developer, M/s Parsvnath Developers Limited, to refund the amount with interest at the rate of 9% per annum from the date of respective deposit until the date of refund. The home buyers had challenged the NCDRC's order dated September 29, 2022.
The appeal has been partly allowed by the Supreme Court. The direction for the refund of the entire amount deposited by the complainants-appellants has been upheld. However, the direction regarding the interest rate has been modified, and the developer is now required to pay interest at the rate of 12% per annum from the date of respective deposit until the date of refund.
The Supreme Court bench has enhanced the interest rate from 9% to 12% per annum, stating that the home buyers had to suffer for a long time without any fault of their own. The court found that the NCDRC was correct in directing the developer to refund the entire amount deposited by the home buyers. However, the court held that the NCDRC was not justified in awarding a lower interest rate than the one agreed upon in the agreement.
The unpaid amount, as per the court's judgment, must be paid within three months from the date of this judgment.
The Supreme Court's judgment is a significant victory for the home buyers, who have been seeking justice for the delayed possession of their flat. The court's decision to enhance the interest rate on the refund amount is a clear indication that the developer must be held accountable for the inconvenience caused to the buyers. This ruling sets an important precedent and sends a strong message to developers that they must adhere to the terms and conditions agreed upon with home buyers, or face serious consequences.
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