Builder warned against handing over Incomplete project to residents

RegNews, New Delhi: The Supreme Court Bench, comprising Justice Hemant Gupta and Justice V Ramasubramanian, has remarked that builders should fulfill their promise to buyers and cannot escape liability. The Bench felt that Padmini Infrastructure leaving the project handing over incomplete project to the residents’ welfare association is not proper. In such case, the builder should pay compensation to the association. Deciding an 18-year-old case, the Bench asked the builder to pay a compensation of Rs 60 lakh to the Royal Garden Residents’ Welfare Association for failing to fulfill the promise of construction of water treatment plant, second health club, swimming pool and installing fire-fighting system.

The Padmini Infrastructure started a 282-flat housing project. It handed over the flats to the buyers between 1998 and 2001. The buyers formed into an association in 2003.  In November 2003, it entered into an agreement with the builder for maintenance of the complex. However, the builder did not fulfil the terms of the agreement forcing the residents to approach National Consumer Disputes Redressal Commission (NCDRC).

Upon hearing the case, NCDRC decided the case in favor of the consumers. The builder went in appeal to SC against the decision in 2010 and managed to obtain a stay in enforcing the verdict f the NCDRC. However, the SC asked the builder to deposit Rs 60 lakh with its registry pending disposal of the case. Nearly after a decade, the SC Bench heard the petition and dismissed the builder’s contention and asked the builder to pay Rs 60 lakh –deposited with the court’s registry — to the residents’ association.

The association entrusted maintenance of the apartment complex to the builder 18 years ago. In this backdrop, bringing pressure on builder to provide those amenities now are not necessarily feasible, the SC Bench opined.

At the same time, the complainant should get relief. Therefore, the Bench asked the builder to pay Rs60 lakh along with interest to the complainant. The court also asked the builder to vacate the club house, clearing the building material in it, and hand over it to the complainant in two weeks.