Bharkavi was a happy woman when she invested her entire savings in a flat she purchased from a reputed builder in the city. However, her happiness was short-lived as she was in for great disappointment as months progressed. Though there were regular demands for payments and Bharkavi was prompt with payments, there was a huge delay in the completion of the apartment and handing over. The builder’s team came up with numerous excuses each time she raised the issue. Moreover, when the floor tiles were fixed, she was dismayed to find that they were not laid as per specification and design. Meanwhile, cracks had developed on the interior walls, making her wonder about the quality of the materials used for construction. Bharkavi questioned all these, but met with silence. Even while she was contemplating on how to take the matter further, the builder offered possession of the flat. Since there was already a delay of almost a year, Bharkavi feared that raking up the other issues just then might result in further delayand therefore, waited till she took possession. Now, with the flat in her hands, she has decided to proceed further against the builder, and on our advice, will be sending out a detailed complaint letter to the builder and will also be approaching the Consumer Fora, if required.
The common problems faced by consumers in the real estate sector are delay in handing over of possession, construction without proper approvals, difference in measurement in actual built-up area and super built-up area, and very often questionable and defective construction.
Unfortunately, most agreements signed with builders tend to be one-sided — with builders stipulating higher rates of interest for delayed payments and a lack of a penalty clause for delays on part of the builder in handing over possession. Providentially, despite such clauses, consumers can get compensation from builders for construction delays and other deficiencies. The Consumer Protection Act provides for compensation for any service that turns out to be deficient. Since delay in delivery also constitutes deficiency, consumers can demand compensation.
The Supreme Court, in the landmark judgement in the case of Lucknow Development Authority Vs. M.K. Gupta, observed that when possession of property is not delivered within the stipulated period, the delay so caused is denial of service and thus, the affected consumer is entitled to compensation.
Once the Real Estate (Regulation and Development) Bill, 2012 becomes a law and is enforced by the States — the first of its kind to regulate the real estate sector and protect the consumer — it will prevent builders from making false and exaggerated claims; overcharging consumers and diverting funds for newer projects, which sometimes leads to delays.
(The writer works with CAG, which offers free advice on consumer complaints to its members. For membership details / queries contact 2491 4358 / 2446 0387 or helpdesk@cag.org.in)
