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Rimpal Johal (Tech Lead)     10 January 2012

File a consumer case against builder

Hi,

We have booked the appartment in the housing society in NCR initiated by one builder. This builder is now delaying the possession and even not full filling the promise of giving late payment charge as promised at the time of booking. We have stopped the further installments as builder is not completing the work and on this builder is continuously sending the reminders with late payment charge for the remaining installments.

In this case, can there be a consumer case file against the builder for harassing the customer and delaying the possession? Can somebody pls suggest me the legal way of handling the builder.Is their any referance of lawyers who are specifically handling these type of cases?

Thanks

Regards



Learning

 21 Replies

Kumar Doab (FIN)     10 January 2012

If late payment charges liable to be paid by builder are expressed in writing in agreement then builder is liable.

Reference of related LCI lawyers is given on the bottom of this page.

RAHUL TOMAR (ADVOCATE)     11 January 2012

Hello,

In this matter, you can file a consumer case against the builder for harassing the customer and delaying the possession, and builder is liable to give possession and compensation or monthly rent or both.

Best Regards

Rahul Tomar

                    Advocate

9910832956

 

k.chandrasekharan (advocate)     30 January 2012

cases of builders harassing purchasers abound in this country in all cities and towns.  But very few aggrieved persons take to the legal recourse and even when some do, adequate materials and grounds are not built up in advance and with the powerful money and muscle powers often builders go scotfree. Also the grandiose conceit of every person who has learnt 26 alphabets of a to z, deeming himself as capable of understanding everything written by using these alphabets, leads to failure of cases. Proper legal advice is required even for successful pursuit of cases before consumer forum.

With this background, I would state that while the builder has been issuing notices, what response is there to them by the purchaser, is not stated in the query. Telephonic conversations, sms messages in modern lingo are the normal panic reactions which will never come to light in court. Every one of the notice of the builder is to be responded to by letter or email, if such communication is allowable under the agreement. Letters are better to be sent by registered post A.D. and it is better to avoid courier service. The receipt, acknowledgement,if received, are to be neatly fastened to the copy of such letter.

Every such letter should contain narrative of the acts of omission and commission, of the builder in utmost detail Dates,time of conversation if any, names of persons contacted, place where contacts took place are to be mentioned in detail. It is not enough to mention 'your representative', 'many times' etc.

The fine print clauses of the agreement are to be gone through minutely. Most of these agreements run into dozens of pages and often contain clauses that are one-sided in favour of the builder. These agreements often contain arbitration clauses also. The overall impact of these clauses and the effect of purchaser's own default of not paying instalments as agreed upon, are to be studied. Thereafter a well-informed decision to approach consumer forum is to be taken. All these require patient and persistent groundwork.

Save the generalities presented as above, more pointed answer is not possible to be given, in the absence of details required.

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     26 February 2012

I fully agree with Advocate Chandrasekharan.

However even if the date of delivery by the builder is not mentioned in the agreement, delay in delivery beyond a reasonable time limit will be termed as deficiency in service under the Consumer Protection Act, 1986. The delay in payment or non-payment of the instalment should have nexus with delay in delivery or non-delivery. In order to confirm this the purchasers should give notice to the builder giving the reason for their non-payment. Also all the purchasers or at least a majority of the purchasers should act together. I would think that a large amount is involved and the case will have to be filed with the State Commission, if not, with the National Commission. The case should be filed as a group and one or two representatives should be nominated by the group.

In which State and in which city is the case?

Rimpal Johal (Tech Lead)     02 March 2012

Thanks Mr. K. Chandrasekharan. I need to discuss with you in detail. Would it be possible if I can contact you anyway. I am based in Greater Noida.

Regards

Rimpal Johal

Rimpal Johal (Tech Lead)     02 March 2012

Thanks a ton Mr MPS Ramani. I am based in Greater Noida, Uttar Pradesh.Can you pls suggest me how should I proceed to file with National Commission or State Commision.

 

Regards

Rimpal Johal

9971502225

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     02 March 2012

If your claim is Rs.20 lakhs or less you can file your complaint at the district consumer forum, which will be at the district head quarters of NOIDA. As NOIDA is quite large a District Consumer Forum may be there itself. If the value of your claim is more than Rs.20 lakhs but 1 crore or less the complaint will have to be filed before the  State Consumer Commission, which may be in Lucknow. If the claim is more than 1 crore you will have to file with the National Commission, which is in New Delhi. In UP you may have to file the complaint in Hindi, though under the Constitution of India, English also can be used.

Siddhartha Chatterjee (BM)     07 July 2012

Dear esteemed members, I am a finance professional and am not much aware about the nuances of law.

I have recently got a house constructed by an contractor, the contractor took 22 months to complete as against 6 months as per agreement. He also did alot of erroneous construction and used sub standard materials. The agreement had an arbitration clause. He has sent me notice through his lawer for recovery of dues. I wish to approach the consumer forum. My lawer is of the view that although I can rightfully approach the district forum he requires some reference to case laws wherein a similar case was filed by a consumer against any builder and the agreement had an arbitration clause.


Can any of you help me with this. I shall be ever grateful.

Regards

Siddhartha

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     08 July 2012

You can simultaneously file a complaint in the consumer court also. The Builder cannot go to Consumer Court as a complainant though he can go to higher consumer courts as an appellant.

Arbitration comes under civil law. I do not know the exact wording of your arbitration clause. But generally if it is a single arbitrator, he should be acceptable to both the parties. Better you engage a lawyer to argue on your behalf before the arbitrator. The arbitration clause itself may be having loop holes to delay it. The decision of an arbitrator need not be final. Under Civil Procedure Code you can go to a Civil Court. I do not know whether you can go to the Consumer Court.  But certainly you can try.

1 Like

Siddhartha Chatterjee (BM)     08 July 2012

The text of the arbitration clause states that in case of any dispute both the parties may appoint their arbitrator who shall appoint an umpire.

My queri is kindly give me some Apex court rulings wherein inspite of an arbitration clause a consumer can approach the forum and the OP can not contest it based on the fact that there exist an arbitration clause.

I did find out similar rulings in www.indiankanoon.org but can any of u people help me further with my query. Rgds Siddhartha

sumeet.prsh@gmail.com (RM)     29 August 2013

Hi, My Aunty has booked property in signature group ongoing project " Signature 360 " in Bhopal.initially they were marketing that project is walking distance from AIIMS bhopal however it is around 3 Km from the AIIMS. in between i have contacted them for Architect letter confirming the latest stage of the construction of the project. i have send them email on 12/june/2012 and they had recently send me the same. My question is - Can a architect confirm stage of construction on builder's letter head ? as letter which i have received is on Builder's letter head.

My another question is if i cancel the unit  then builder will charge me 10 % of the consideration value as a cancellation  charges.

Please advice. My no is 9820100587 

RINENDRA KUMAR YADAV (ACCOUNTANT)     21 October 2014

I HAVE PURCHASED A UNDER CONSTRUCTION FLAT IN NEEMRANA RAJASTHAN IN MAY, 2014.

I HAVE NOT RECEIVED ANY DOCUMENT TILL THREE MONTHS, AFTER THREE MONTH IN 15 AUGUST, I HAVE RECEIVED ALLOTMENT LETTER, BUILDER BUYER AGREEMENT & DEMAND LETTER WITH INTEREST.

NOW MY QUESTION IS :

1. AS PER MY BA AGREEMENT THERE IS TWO PAYMENT PLANS AVAILABLE ONE IS CLP "A" & OTHER IS CLP "B", BUT THEY SEND ME DEMAND AS PER PAYMENT PLAN CLP "A". WHEN I ASKED TO BUILDER TO CHANGE THE PAYMENT PLAN, THEY DENIED TO CHANGE, THEY OFFERED ME THEIR CURRENT PAYMENT PLAN, WHICH IS DEFFERENT FROM PREVIOUS ONE MENTIONED ON BA.

2. THEY ALSO CHARGED INTEREST ON PENDING DEMAND FROM DAY ONE, WHILE THEY DIDN'T SEND ME DEMADS ON TIME, THEN HOW THEY CAN CHARGE INTEREST.

I ALSO COMMUNICATED THEM IN JULY THAT I HAVE NOT RECEIVED ANY DOC THROUGH MAIL.

NOW CAN I FILE CASE IN CONSUMER COURT FOR THE SAME. IS I AM LEGALLY RIGHT.

Ismail M (Executive )     08 December 2014

I am writing this mail regarding the malpractices of the builder name Mr Z and his son Y of ABC Builders and Infra projects Limited from Vashi, Navi Mumbai, who clicks pictures with every respected person from political background and put that picture in his office to show to the world that he has friendly relation with politicians.

 

With such pictures he gains flat buyers confidence and does malpractices in his dealings and deals with them in a way where he keeps himself free from all mistakes and faults and put all flat buyers in a mess and in great difficulties.

The intention of sending this mail to you is to inform you about him so that you could provide your assistance which can help not only me but many other citizens of our country who has booked flats with shah group builder.

1) I have booked a flat in 2010 with shah group builder and he has committed to give possession within 2 years from it.

None of his projects finishes on time and he does malpractices of changing possession dates from 2 years to 4 years at the time of stamp duty and registration without informing flat buyers. 

At the time of booking the flat in 2010, he said to me and my wife that he will give possession in less than 24 months but at the time of stamp duty and registration he changed possession date from the agreement from 24 months to 48 months which happened in my case and I think he has done this to most of the other flat buyers also for which I have another flat buyer as a witness and proof. It was my mistake that I did not read the agreement carefully at the time of registration and that is because of the trust which he has developed amongst flat buyers because of such pictures with respected political personnel.

2) In addition to it, he had asked us to pay 7 lacs for parking which I believe is against the supreme courts order. When I pointed out this to him via mail as a notice now he has agreed to give parking free but not yet provided an allotment letter for parking even after several request and reminders.

3) I have paid him as per super build-up area and he refuses to accept that also. He has cancelled and written in my agreement as Lump sum amount which was mentioned as super build-up which is clearly noticeable in my agreement.

 

When I pointed out all these to him he is denying all these and refuse to pay me the delay charges which I believe he should pay me over 2 years because I have booked a flat in 2010 and in reality he has promised us to give possession in 2 years ( that means 2012) and this is not only to me but almost every buyers which I have a witness and proof. Now it's 2014 coming to an end and his project is yet not ready for possession. It will further take minimum 6 months to 1 year for possession and I am paying heavy EMI and interest to the bank every month, which is unfair.

I request you to kindly suggest me as to what best I can do in order to get my delay charges since 2012 as well as my parking allotment letter from him as well as what best I can do so that other flat buyers also get their justice and this builder gets a severe punishment from the authority.

He is forcing me to take my money back with interest and leave his property after I have pointed out his mistake, for Which I told him so many times that I don't want to do that as the trouble which I and my wife faced during these 4 years will not be compensated by any amount and we have taken that house for our children's futures.

He does not give me an appointment for meeting to settle this issue nor his receives my phone call.

I request you to kindly help me from this as I am paying heavy EMI to the bank regarding the same.

If required I will have to take this matter to prime minister and media in order to save other citizens of our country from the malpractices of this builder.

I look forward for your help and support.

 

Thanking you in anticipation.

Your's sincerely,

Ismail M

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     11 December 2014

@ Mr. Ismail M. As your project is not finished yet the builder may create more problems if you go to court now. What I suggest is that you carefully keep a record of all dates, all payments and promises by word as well as deed. After you occupy the flat in due course, you can go to consumer court with all your claims. If there are others similarly placed all of you together appoint a single lawyer and go to court. Alternatively you go for cash settlement taking into account escalation in market price of the flat. The only problem would be that you may not be able to claim if there are any black component in the amounts which you pay. Parking lots can neither be sold nor allotted free by the builder. After the building is completed and a co-operative society is formed, the Society will allot the parking lots to members fixing a monthly parking fee. All purchasers together should insist on the formation and registration of a co-operative housing society. A co-operative society will have more powers vis-à-vis the builder than an Association. From what you write I should guess that already enough number of flats would have been sold to form a co-operative society. First ask the builder to form and register the society. If he does not do it, the purchasers can on their own form and register the society. Afterwards you can fight with the builder as a Society. Unity is strength.

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