Homebuyers Win Major Victory: 16-Year Wait for Possession Ends with Refund and Compensation

In 2010, two office colleagues from Delhi-NCR applied for 3BHK flats in a residential property project planned by a cooperative housing society in Noida. For this, they even became members of the housing society. The housing society had promised them possession of flats by 2012. Almost 16 years later, they are still awaiting delivery of flats to date.

During this period, the homebuyers claimed that they continued to pay lakhs in home loan EMIs (equated monthly instalments) and additional amounts demanded by the society, which allegedly kept revising and escalating the cost of the flats by imposing additional charges, such as parking fees, goods and services tax (GST), and service tax. Against the originally agreed prices of Rs 24,00,000 for homebuyer 1 and Rs 26,60,300 for homebuyer 2, they ended up paying Rs 39,08,865 and Rs 40,34,234, respectively.

After years of waiting for possession, the two homebuyers finally approached the Delhi State Consumer Disputes Redressal Commission in March 2024, seeking relief. The commission recently ruled in their favour, ordering the housing society to refund their money with interest, along with compensation for mental agonies and litigation costs.

The case dates back to 2010 when the two homebuyers made bookings for 3BHK flats in a housing society project initially proposed in Noida. They were promised the possession of the flats in two years. However, the society shifted the project to Ghaziabad following alleged disputes over the land.

Consequently, the buyers paid more money due to revised costs and new agreements made in 2013. The housing society revised the cost of the flats for both the complainants (homebuyer 1 and 2) in the new project to Rs 28,78,200. However, despite repeated assurances of timely completion, the society allegedly continued to delay the project while repeatedly increasing the cost of the flats.

According to the submission by both the complainants (homebuyers), the society made the additional demands under various heads like parking charges, escalation cost, GST, service tax, mechanical ventilation charges, smoke detector charges, and other miscellaneous charges. This compelled the homebuyers to avail additional and top-up loans in 2018.

According to the submission, both homebuyers received their allotment letters in June 2019, nearly six years after the execution of the new agreement. Still, no flats have been handed over to them till now. Both homebuyers have already made payments of Rs 39,08,865 and Rs 40,34,234, respectively, to date.

The commission noted that the housing society continued extending the project completion date, while simultaneously raising additional demands under different heads, thereby increasing the financial burden upon the homebuyers.

“It is also evident that while the complainants duly fulfilled their obligations by making payments as demanded and by availing loan facilities for the said purpose, the Opposite Party (the housing society) failed to fulfil its obligation of delivering possession of the flats within a reasonable period of 42-48 months from the date of the agreements,” the commission said.

Observing that a cooperative housing society can be treated as a “service provider” under the law, a bench comprising Justice Sangita Dhingra Sehgal and Bimla Kumari held the society guilty of deficiency in service. The commission rejected the society’s argument that it couldn’t be treated as a service provider.

Additionally, the commission also dismissed the housing society’s reasons for the delay in the delivery of flats. The society had claimed that issues like land disputes, rising costs, environmental restrictions, and the Covid-19 pandemic were behind the delay.

Noting that the housing society failed to file any cogent documentary evidence to explain the inordinate delay in completion of the project and handing over possession, the commission stated, “In the absence of any supporting evidence, the said contention cannot be accepted.”

Further, the commission ordered the housing society to refund the complainants—return Rs 39,08,865 to one homebuyer and Rs 40,34,234 to the other, totalling Rs 79,43,099, along with interest at 8.25% per annum. It will be paid from the date of each individual payment received by the society until June 8, 2026.

“The Opposite Party (the housing society) was deficient in rendering services to the Complainants (the homebuyers) by failing to hand over possession of the flats within a reasonable period and kept the amounts deposited by the Complainants for almost sixteen years,” it said.

If the refund is not made on or before August 8, 2026, a higher interest rate of 11.25% per annum will apply until full realization, it said. In addition, the commission has also directed the housing society to pay the homebuyers Rs 4 lakh (Rs 2 lakh each) for mental agony and pay Rs 1 lakh (Rs 50,000 each) in litigation costs.