Possession Delayed, Compensation Awarded: Delhi State Commission Rules Against Parsvnath Developers
Pranav B Prem
The Delhi State Consumer Disputes Redressal Commission, comprising Justice Sangita Dhingra Sehgal (President) and Ms. Pinki (Judicial Member), held Parsvnath Developers Ltd. liable for deficiency in service due to an inordinate delay in handing over possession of a flat booked by the complainants. The Commission directed the builder to pay Rs. 4,00,000 as compensation and hand over possession within a month, failing which the entire amount would attract interest.
Background of the Case
The complainants, Nitin Bansal and Amita Bansal, had booked a 3BHK flat bearing number T2-302 in Tower T2 with Parsvnath Developers Ltd. for a total sale consideration of ₹27,68,150. A Flat Buyer Agreement was executed on 19.04.2007. As per the agreement, the developer was obligated to deliver possession within 30 months from the commencement of construction, with a further grace period of 6 months. The complainants made payments totaling ₹26,93,205 by June 2015. Despite this, possession had not been handed over by the developer.
In addition to the delay, the complainants alleged that Parsvnath Developers made additional demands such as increased area charges, VAT, and parking charges, while also failing to disclose the final covered area of the flat, preventing the calculation of registration and stamp duty charges.
Arguments of the Developer
The builder contested the jurisdiction of the Delhi State Commission, arguing that the matter involved complex questions of fact and law that could not be decided through summary proceedings and should be left to a civil court. It also claimed that the flat had been purchased through a third party and not directly from the builder, and cited global recession as the reason for construction delays.
Commission’s Observations
The Commission rejected the jurisdictional challenge, relying on Section 17(2) of the Consumer Protection Act, 1986. It held that since the developer’s branch office is located at Barakhamba Road, New Delhi, territorial jurisdiction was clearly established. The Commission also relied on the decision in Rohit Srivastava v. Paramount Villas Pvt. Ltd [2017 SCC OnLine NCDRC 1198], to reiterate that cases involving registered or branch offices of service providers in Delhi fall within its jurisdiction.
On the issue of maintainability, the Commission held that since the grievance arose from non-delivery of possession, it did not involve any complicated legal questions and was well within the purview of the Consumer Protection Act. The Commission further relied on the Supreme Court’s decision in Arifur Rahman Khan v. DLF Southern Homes [2020 (3) RCR (Civil) 544], which affirmed that failure to deliver possession as per contractual terms amounts to deficiency in service.
Clause 10(a) of the Flat Buyer Agreement specifically required that the flat be constructed and handed over within 30 months of commencement of construction, with a 6-month grace period. However, this obligation was not fulfilled despite substantial payment from the complainants.
Intervention by National Commission
The complaint was initially dismissed in default due to non-appearance, but the National Consumer Disputes Redressal Commission (NCDRC) in appeal allowed it to be restored and decided on merits. It noted that the delay was not due to lack of diligence on the part of the complainants but occurred during the COVID-19 pandemic. Importantly, the NCDRC recorded the builder’s willingness to hand over the possession and pay Rs. 4,00,000 as a lump sum settlement, after adjustment of all dues. The NCDRC order dated 28.08.2024 was accepted and taken on record by the State Commission. The bench also noted that although the builder had earlier paid ₹4,43,525 towards delay compensation, it failed to comply with the rest of the order till the final hearing.
Final Directions
The Commission directed the builder to:
Hand over possession of the flat to the complainants and
Pay ₹4,00,000 as agreed compensation within one month (i.e., by 02.08.2025).
Failing compliance, the entire amount was ordered to be refunded along with interest at 9% p.a. calculated from 16.12.2014 till realization.
Additionally, the Commission awarded:
₹1,00,000 as compensation for mental agony and harassment
₹50,000 towards litigation costs
The complaint was allowed with a clear direction to deliver possession and comply with the agreed financial settlement.
Appearance
Complainants: Adv. Tushant Deep Garg
Opposite Party: Adv.T.P Chauhan, Adv. Tanvi Garg
Cause Title: Nitin Bansal & Anr V. Pasvanath Developers
Case No: Complaint No. 782 /2016
Coram: Justice Sangita Dhingra Sehgal [President], Ms. Pinki [Judicial Member]
