Good news for Home Buyers brought by a Recent Supreme court Judgement – An Analysis
Recently, the Supreme court judgement in the civil appeal number 6239 of 2019, and Civil appeal number 6303 of 2019 (Wg. Cdr. Arifue rahman Khan Vs. DLF Southern homes) has brought cheers to the home buyers activists. The UP Aggrieved Home Buyers Rights association feels that the valuable fine points decided by the apex court should reach to all the aggrieved home buyers, as well as the new buyers and other activists fighting and raising their voice for justice to home buyers in getting the possession of their dream houses and due compensation from developers for the delay in giving possession of houses with all promised amenities.
As we all know that before RERA came into being, the home and apartment buyers had to approach SCDRC(State Consumer Disputes Redressal Commission) and subsequently NCDRC (National Consumer Disputes Redressal Commission) if the developer/builder didn’t complete the housing project within time or failed to give possession of the flat with all amenities as promised in the Brochure/agreement during purchase. Still now some home buyer consumers prefer to approach consumer disputes redressal commission rather than RERA as the scope of RERA is limited as far as awarding quantum of compensation and criterion for compensation is concerned. But as we all understand, RERA is the right platform as of now to get buyers issues addressed. We as citizens need to empower RERA by providing our valuable inputs and suggestions to make it more effective.
It’s a well known fact that the courts are overwhelmed and so sometimes, it takes up to 3 to 4 years at SCDRC and NCDRC for a hearing to conclude. During this long period, complainants due to their bad financial situation(loan repayment, living on rent) or due to their retirement date approaching or due to their age factor or due to threats from builder of cancelling their allotment or whatsoever reasons, may opt to take possession of their incomplete flat sometimes even finishing the flat at their own cost, Or they take possession of flat in a fairly incomplete project with unfinished roads, amenities at their own risk. Builders in most of the cases even force them to sign an affidavit which says that the buyer is fully satisfied with the condition of completion of the project, that buyer will never go to court, and with other such arbitrary clauses. Poor home buyers have to sign on the affidavits on the dotted lines or they are not allowed to enter their flats.
The Judgement by a bench of Justice Y. Chandrachud and Dr. Dhananjaya brings good news for complainant home buyers. Bench logically divided the complainants in 6 categories and pronounced judgement covering each category. These are the 6 categories –
Group A– Complainants who took possession of their flats before the filing of the complaint/impleadment Applications.
Group B: Complainants who took possession and executed deeds of conveyance during the pendency of the complaint/impleadment applications.
Group C: Complainants who took possession during the pendency of the complaint/impleadment applications but have not executed deeds of conveyance.
Group D: Complainants who settled their dispute during the pendency of the complaint/ impleadment applications.
Group E: Complainants who sold their flats during the pendency of the complaint/impleadment applications.
Group F: Complainants who have not taken possession of the flats and have not executed a deed of conveyance.
Judgement very clearly decides that except Group D and Group E complainants, all the other categories of complainants are entitled to be heard by Consumer Dispute Redressal Commissions and entitled to receive the compensation for the delayed handing over of possession and for the failure of the developer/builder to fulfil the promises/commitments made in the brochure or advertisement that enticed the fat buyers to purchase flat in the said project. The judgement then awards compensation to all the flat buyers of all the categories of complainants except those who settled their disputes with developer/builder(Group D) and those who sold their flats during the course of the hearing of the case(Group E).
There are 2 major positives for the buyers in the Judgement –
Builders/Developers have always forced the home buyers to execute deeds of conveyance/register their flats sometimes even before giving the possession of the flat. It is done so that buyers cannot move the court for any deficiency of services in the project later. Even if the buyer moves the court, the builder gets the case quashed on the ground that once deed is done, no claim for supply of services can be done. But the judgement categorically decides that developing flats/plots/independent houses in a project with certain assured amenities is an ongoing service and even buyers who took possession or executed Deed of Conveyance can claim compensation for delayed handing over of flats. Judgement observes that it is unreasonable to expect a buyer to not obtain a deed of conveyance if the buyer wants to pursue a claim of compensation for delayed handing over of the possession. It is the right of the buyer to obtain the deed of conveyance to perfect the ownership of the property purchased.
Judgement decides that the developer/builder be held accountable for the representations made by the developer/builder in the form of brochures or advertisements or buyers agreement for developing certain facilities and amenities in the integrated project, thus giving dreams to buyers of living a life of convenience and a certain lifestyle based on the existence of those facilities and amenities. Developers/builders cannot be allowed to make false assurances and representations to entice the buyers to purchase a property and later escape from its obligations to fulfil those assurances and representations. And if the builder does not provide the facilities and amenities as represented, then the buyer can approach the court of law for remedy or compensation.
Uttar Pradesh Aggrieved Home Buyers Rights Association also wishes to educate flat buyers of their rights, and suggests few smart strategies that home buyers need to adopt while fighting for possession of their flats with all the common amenities. The unity of the home buyers and their consistent persuasion has already forced the government to come up with an act like RERA for the rights of the home buyers. So if we remain united and help each other, we will definitely be able to get possession of our dream houses with all amenities in record time.Suggestions are –
Do not rely just on the verbal communication with the developer/builder. Always Insist on written commitment. In case, the developer refuses to give things in writing, then you can send an email from your side to the official email id of the developer, copied to all the email ids of the officials of the developer company you have. Also send a registered letter on the same to the postal address of the company. As postal receipt print deteriorates quickly, please take a photo of it and save it. Save all the documentation also.
While executing the deed of conveyance, the developer/builder generally asks the buyer to sign an affidavit on stamp power. The affidavit generally says that the buyer is fully satisfied, that the buyer agrees that the project with all the amenities is complete, that the buyer will never approach court for any deficiency of services and stuff like that. In this case, the buyer has every right to deny to sign the affidavit Or has the right to ask the developer to remove certain controversial sections from the affidavit. In case the developer insists, then the home buyers association can be approached at ubhbsangh@gmail.com for consultation. Or in case If you are ready to take some pain, then approach the city development authority/rera with the complaint. In the worst case, you may do the affidavit but under protest. Please send a communication first to the developer that the affidavit is not in the right spirit and then again a communication when you finally decide to sign the affidavit that you are signing the affidavit under protest.
In case you have already filed a case in consumer court or any other court of law, and the hearing is taking more time than expected, then you can take possession of your flat/home under protest by following the steps as explained in point 2) above. In case you have possession and want to execute deed of conveyance, then also do the same under protest. This will ensure that your claim for delay compensation is not affected in court of law.
Even though your project is awarded a completion certificate by the respective development authority, if the common amenities and facilities are still to be constructed, Or your flat/house is still pending to be constructed, you can move RERA or Consumer Court against the developer/builder. It is often advertised by the builders and some lawyers that once completion has been awarded to the project, the buyers lose all the legal rights to move courts. This is wrong. Please do not fall in the trap.
Alok Singh
Convener
Uttar Pradesh Aggrieved Home Buyers Rights Association