Q.Please give examples of damages / penalty awarded by the court against the builders, who have failed to comply with their statutory obligations?
A. Recently the Competition Commission of India has levied penalty of R630 crore on Real Estate Company, DLF, which has given a big boost to the Flat purchasers. The reason for the same was unethical trade practice. Many times it is observed that Builders fail to carry out their statutory obligations. Recently, on 13th August 2014, the State Consumer Dispute Redressal Commission passed orders directing the Builder to pay a sum of R32 lakh in a case filed by Arunodaya Co-operative Housing Society Limited against Pattavu Brothers, which included R19.76 lakh as reimbursement of the expenditure incurred and R12.44 lakh towards interest, besides direction to the Builder to execute conveyance and transfer the right, title and interest in the building and land to the Society within a period of four months.
Q. My society is having a dispute with the builder, who has not executed conveyance. The Property Card is standing in the name of a person from whom the Builder had acquired right, title and interest in the property. Builder says our society should make the person in whose name the Property Card is standing, a party to the consumer case. Is this necessary?
A. In my view your Co-operative Society need not make the owner of the property a party to the proceedings as the privity of contract exists between the flat purchaser and the Builder. The same view was taken by the State Consumer Dispute Redressal Commission in the case of Arunodaya Co-operative Housing Society Limited v/s. Pattavu Brothers. Your Society should take a stand that it is the statutory obligation of the Builder to execute the conveyance within a period of four months from the date of formation of legal entity as laid down in Sec. 10 of the Maharashtra Ownership Act. Your Society should also take a stand that as per Sec. 6 of the Maharashta Ownership Flats Act, it is the responsibility of the Builder to pay the outgoings of the building, till the property is conveyed in favour of the legal entity. Your Society should also insist that the Builder should obtain the Building Completion Certificate and hand over the original documents of title to the property.
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