Mumbai: Commission directs proportionate market price be refunded to two complainants

Mumbai: The State Consumer Disputes Redressal Commission (SCDRC) directed a developer to give a proportionate market price to two complainants for flats each booked.

In 2009, the complainants each paid Rs 3 lakhs for an Rs 8 lakh flat.With a flat price over Rs 40.95 lakhs, the commission directed Rs 16 lakh be paid to each, besides Rs 2.25 lakh in compensation for mental agony and litigation costs, in two months, failing which 12 percent interest per annum will have to be given.

The two orders dated September 28, 2022 (uploaded Nov. 12, 2022) were given on complaints by Bhandup residents Vinod Bhosale and Sushant Katkar against Tuli Builders, through its proprietor, Arun Kumar Tuli. The orders were passed by S. P. Tavade, president, and S. T. Barne, a member of the SCDRC.

They booked one BHK flat each

Bhosale and Katkar had booked one BHK flat each for themselves measuring 270 sq. ft. (carpet area) in 2009 when they were in need of residential accommodations.

The booking was done based on an advertisement for a flat in Chembur by Tuli Builders, a proprietary firm engaged in development and construction activity, and Tuli was solely responsible for all the administrative, financial, and day-to-day business transactions, including their commitment to their customers.

Both had reserved apartments in the Paralkarwadi Co-operative Housing Society Ltd.The total consideration for each flat was Rs 8 lakhs, with both parties contributing Rs 3 lakhs as part consideration.A temporary sale agreement was made in favour of Bhosale and Katkar in July 2009, and both were assured of possession within two years.

The sale agreement was not registered despite several meetings

The sale agreement was not registered despite several meetings and the promise that it would be registered in a short period. Regarding the handover of flats, it was told that progress on the development was slow due to a shortage of labour and materials but that it would be handed over in time.

But later, construction activity stopped altogether, and both complainants demanded that either the project be completed or a refund be given. Neither the construction progressed nor was a refund given until the time of filing the complaint. In 2018, the market value of a flat was Rs 40.95 lakhs, according to the ready reckoner rate.

When the notices were issued, the firm failed to appear, and so in both cases, the order to vacate was passed. Based on the records, the commission stated that since both had 40 percent of the flat value back then, proportionate market value should be given to them as there was a deficiency in service and unfair trade practice.