Mumbai SCDRC Orders ERA and Omkar Realtors to Hand Over Flats and Pay Compensation

The Maharashtra State Consumer Disputes Redressal Commission (SCDRC), Mumbai, has ordered two prominent real estate developers, ERA Realtors Pvt. Ltd. and Omkar Realtors & Developers Pvt. Ltd., to immediately hand over possession of flats and pay compensation and interest to two Mumbai-based complainants. The flats were supposed to be delivered six years ago, but the developers failed to meet the deadlines.

The commission directed the developers to pay the complainants 8% interest on the total amount paid from 2019 until the actual possession of the flats. Additionally, the developers must pay Rs 1 lakh as compensation and Rs 25,000 towards litigation costs.

Ritesh Jain (42) and Vinal Jain (38), residents of Malad, had paid Rs 1,16,18,954 out of a total agreed consideration of Rs 1,81,49,666 for a flat booked in 2018, with possession promised by June 2019. Daisy Irani (48) and Sheriyar Irani (48), residents of Andheri, had paid Rs 1,82,64,369 against a total of Rs 1,90,82,950 for a flat booked in 2017, with possession promised by March 2018.

The judgment held the developers guilty of “deficiency in service and unfair trade practices.” Both complainants had booked flats in the Alta Monte project located in Malad (East).

The developers argued that the complaint was time-barred and cited the arbitration clause, COVID-19, and delays in environmental clearance as reasons for the delay. The Commission rejected these defenses, noting that the agreed possession date was March 2019, a full year before the pandemic began. The Commission also reaffirmed that arbitration clauses do not bar consumer complaints, citing the Supreme Court case Emaar MGF Land Ltd. v. Aftab Singh.

The commission held the developers “jointly and severally liable” and directed them to hand over possession of the flats to the complainants without further delay.