- Agreement between builder and buyer should not be one-sided
- Clarification by the Supreme Court
The Supreme Court delivered a crucial verdict regarding agreements between the builder and the buyer in property transactions. The Court clarified that the agreement should not be one-sided in favour of the builder. If the buyer cancels the purchase agreement, the builder cannot deduct more than 10% from the basic sale price (BSP). This decision was made by a bench consisting of Justice B.R. Gavai and Justice S.V.N. Bhatt.
In this case, a buyer had booked a flat in the Godrej Summit project in Sector 104, Gurgaon, and paid the full amount for the flat. However, upon delivery, the buyer requested a refund, stating that the flat was not available. In response, Godrej Projects Limited offered to return the remaining amount after deducting 20%. The buyer then approached the National Consumer Disputes Redressal Commission (NCDRC). After hearing the arguments, the Commission ordered that the builder should refund the amount after deducting 10% of the basic sale price.
Challenging this, Godrej Projects Limited appealed to the Supreme Court, arguing that the agreement stated that a 20% deduction would apply in case of cancellation, and thus their decision was valid. However, the Supreme Court disagreed, stating that the agreement should not be one-sided and that the current terms were contrary to the contract and unethical. Referring to previous rulings by the Supreme Court, the Court upheld the NCDRC’s order, stating that a 10% deduction from the sale price is reasonable and that anything beyond this is not permissible.
