Blog Details

Author: Priyamvada
Sanjiv Dagar, Legajoist

INTRODUCTION

In this 21st century, owning a house is very difficult, real estate has emerged rapidly builders and developers play a vital role in completing the project and delivering it on time. Due to huge demand along with time and labor constrains builders fail to complete the projects on time, thereby not meeting the commitment they had made to the buyers. In many of the cases builders are responsible for the huge financial losses to buyers. In general everybody has a dream about their own home, where in they are motivated to gather resources from all the possible means and start to build a home.

IMPACT

Once the delivery has been done from the builder to buyer, there will be some or the problems like leakage in pipes, improper drainage system, low quality of electrical wiring, improper water supply, poor quality of raw materials used, leakage in ceiling, fire exhaust will not be completed. And now a day’s most of the buyers rely on vaastu. Many buyers will not be satisfied if the vaastu is not correct.

Late government approvals delay in procuring raw material, labor problems are the major factors for not delivering the project on time, whatever may be the reason at the end buyer suffers the loss. 60-70% buyers will take loan to build a house and if the builder fails to deliver a house it will be difficult for the buyer to repay the loan amount. In some cases buyers will pay the loan amount throughout his life. Before buying a house, buyer should verify the original documents of builders; he should verify that builder has got permission from collector regarding non agricultural land. Buyer should verify transfer fees, stamp duty and registration charges to be paid while purchasing a house. Scrutinisation of sale agreement should be done thoroughly from buyer.

By seeing all the above, it is always wise that buyer should purchase a property from a builder who is affiliated to CREDAI (Confederation of Real Estate Developers Association of India).

The functions of CREDAI are-

1. Introduction of latest construction techniques

2. It has its own code of conduct

3. The members of CREDAI are not allowed to make huge payments if the buyers delay in giving the amount.

Even though care has taken, what if builders deceive buyers?

Below are few circumstances where builders deceive buyers

1. Substandard work

2. Construction without approvals

3. Construction on illegally acquired land

4. Fraud in booking

5. Change of land use, layout plan and structures without the approval of allottee

6. Hidden charges

7. Negligence

8. Cancelation of booking or project

9. Delay in delivering possession

Remedies for buyer if he is deceived from any of the above circumstances

1. First of all, buyer should meet builder personally. Now a day, many builders are consumer oriented. They think customer is God. If buyer tells his problem, builder will promise to correct it in the next moment.

2. He can file a civil or criminal suit depending upon the circumstances. The Supreme Court of India in of the cases held that the buyer can file a suit in court depending upon the circumstances whether civil or criminal. There are many bye-laws such as Real Estate Regulatory Authority, Karnataka, Karnataka State Property Registration Act etc, where buyer will be paid his damages with interest on it.

3. Buyers can approach National Consumer Dispute Redressal Commission (NCDRC) in case where the builders delay to give possession.

4. Buyer can file a complaint under Section 12 of Consumer Protection Act, 1986 within 2 years from the date of dispute.

5. Buyers can approach District Forum, State Commission, and National Commission.

6. Government has established RERA Act which stands for Real Estate (Regulation and Development) Act in the year 2016. RERA Act helps to provide speedy disposal of suits. Though RERA is centralized, the central government has given authority to each state. So, an aggrieved buyer has to approach respective state RERA for Redressal.

7. In one of the cases, Supreme Court held that, due to negligence of builder he is responsible to repay the amount with interest to buyer

8. If there is any case where it comes to the knowledge of buyer about construction is done without the proper approval of concerned authority the buyer can file a complaint in consumer forum or can file civil suit for damages caused to him. The Supreme Court held that builder is responsible to repay the damages caused to the buyer along with interest as compensation.

9. If the buyer proves that, builder has constructed on illegally acquired a land, then he can approach consumer forum or can file civil suit for damages caused to him for investing the money or can ask for alternate arrangement of his accommodation.

10. If a builder is aware that he cannot give possession of building in time it amounts to fraud and builder misrepresents that he will fulfill his promise in delivering the building in stipulated time, the buyer can file a suit for damages or specific performance under The Indian Contract Act, 1872.

11. In one of the cases, commission directed to builder that, he has to complete the project and handover the possession in stipulated time failing which, he should pay compensation to buyer in the form of simple interest @ 10%pa from the committed date of possession till the date of possession is offered to the buyer.

CONCLUSION

Buyer is investing his hard earned money to build a house with the builder. But due to negligence, misrepresentation, delay in delivering property, builder fails to give possession to the buyer. Whatever may be the reason ultimately buyer is the sufferer mentally, physically and financially. Buyer should prudently opt builder to build his house or else he will end up in facing financial problems throughout his life. Now a days there are many ways to the buyer in getting justice. He can approach consumer court, NCDRC, National commissions etc to get the remedy. Courts and commissions are trying hard for speedy disposal of cases.