Developer fined Rs 2.5 lakh for failing to deliver flat

The state consumer dispute redressal commission penalised an Andheri-based developer, who had failed to hand over possession of a flat in Ghatkopar to one Kamal Kale, who had booked it.

The forum asked the developer to hand over possession of the flat and also directed the developer to pay Kale Rs 2 lakh for the physical and mental hardship she had suffered on account of the developer's behaviour. The developer has also been asked to pay Kale an additional Rs 50,000 towards litigation cost.

As per the order, Kale, a resident of Ghatkoper, had approached the developer and booked a flat at the rate of Rs 4,425 per sq ft. The total cost of the flat came to Rs 25 lakh, of which Kale paid Rs 15 lakh. Accordingly, Kale was issued a letter of allotment on August 16, 2010, confirming allotment of the flat.

Meanwhile, Kale raised the rest of the amount she had to pay the builder from Saraswat Co-operative Bank. However, the developer, even after receiving a major chunk of the amount due to him, failed to execute the registered agreement for sale of the flat.

Kale then approached the commission, and the commission asked the developer to file a reply. But the developer failed to do so.

The commission, after going through the evidence, held that the developer had failed to discharge his duty in not delivering possession of the flat by accepting the balance amount of Rs 10 lakh. This amounted to deficiency of service and failure to discharge statutory obligation of executing agreement of sale under section 4 of Maharashtra Ownership Flats (regulations of promotion of construction, sale, management and transfer) Act, 1963.