Delayed possession offer penalty
I bought an under construction independent floor (1620 sq. ft.) with reputed Builder in Jan 2011. Buyer agreement was signed on Jul-2011 and as per contract, builder was liable to offer possession within 2 years.
1. Builder offered possession in Jul-2016, after delay of almost 36 months, asking for payment in two parts - A) 8 Lac (pending 5% +taxes+others) B) 3.5 Lac (Conveyance deed charges)
2. As per buyers' agreement, Builder is liable to pay INR 5 per sq. ft. per month for delay in possession and this would be adjusted against conveyance deed charges. So, I should be paying 3.5L - 2.9L (approx) = 0.6L
3. Builder is refusing to adjust this delayed penalty citing reason of exorbitant price rise escalation of 17% in labour and material charges as per RBI index from Dec-2010 to Dec-2015. Builder says that I am liable to pay additional Rs 5 Lac for this price rise but are waving off as kind gesture. As per one clause in Buyers' agreement, "Price rise is escalation free unless and until there is exorbitant rise". The clause does not mention any figure as to what percentage can be considered as exorbitant.
4. I have paid all amount timely as per demand notice of builder.
5. My contention is that -
a) My flat/floor was completely ready by Aug-2012, as per pics posted by Builder on their registered website and so the price rise case should not apply. The flat was inhabitable but exterior work like water pipeline, sewerage pipeline, electric lines etc work was not completed yet by Aug-2012.
b) Price rise liability on me should be valid only from Jul-2011 to Jul-2013 only. And, price rise of 10% should be norm and should not be considered exorbitant.
c) I was sort of compelled to buy another ready to move-in flat (2Bhk) against heavy loan in Aug-2015 due to family issues and inordinate delay by builder. The flat was bought under resale. I was staying on rent till Jul-2015.
I have already paid part-A payment but held part-B payment.
Kindly assist me with what action I can take further.
Kindly let me know any further information that is required.
Thanks a lot in advance.
Asked 2 years ago in Property Law from Faridabad, Haryana
better pay conveyance deed charges to builder
2) take possession of flat
3) then move consumer forum against builder and seek interest for delay in delivery of possession
4) also seek litigation costs , compensation for mental torture undergone by you
1. Escalation clause has to be read very minutely and its legal import understood before signing the agreement as it provides escape routes to the builder. The clause extracted by you is silent on what is considered as exorbitant.
2. You should consult a lawyer with a copy of the agreement to sell so that the nature and extent of liability can be ascertained. If the demand of the builder is unreasonable and arbitrary then you can either pay under protest to take the possession and then move the consumer forum to recover the excess amount with compensation, or you may refuse to accede to builder's demand and move the consumer forum for delivery of possession with compensation,
If the builder is refusing to pay the penal interest for the delay in completion of construction and handing over possession of the flat, you may issue a legal notice citing the clause and demand him to pay the charges.
He cannot take shelter under the price rise clause as an exemption from paying the agreed penal charges/amount.
The price rise is common and for everyone in the county and not only for him.
The sale consideration includes all such events which are given as lame excuses by the builder now.
Thus as per agreement which includes payment of Rs. 5/- per sq. feet for the delay has to be made by the builder.
He should be dragged to consumer forum seeking the relief of recovery of this amount as well as for compensation towards the mental agony you suffered.
Thank you for your advice.
1) Is there a procedure for payment under protest? How to pay under protest?
2) I have paid requisite amount to builder except for conveyance deed amount (to be paid post review of flat condition). Builder is now asking me to sign an undertaking before handing over keys. The undertaking has some clauses like -
- I do not have any dispute with the builder.
- If any claim is raised then company is entitled to recover 10 times the damages, cost etc.
- I had requested company to waive off escalation charges (labour, material cost etc) of Rs 5 lakh, which company has waived off.
I do not wish to sign such undertaking.
So, I am planning to drag builder to consumer forum first without obtaining keys.
Can I file case in civil court as well, in parallel?
What is the loss (monetary, time) that I can incur?
Asked 1 year ago
in letter you have to mention that payment is made under protest
2)you should not sign such undertaking .
3) file complaint before consumer forum only
4) you cannot file 2 cases for same cause of action
5) if you file in civil court you have to pay court fees
6) cases before consumer forum take atleast 2 years to be disposed of
1. Issue a lawyer's notice for payment under protest and annex the cheque with it. This is how payment under protest is made.
2. Do not sign the undertaking as this may foreclose your legal remedies.
3. You can move the civil court.
You can state that you pay the payment under protest by getting an acknowledgment of the same from the builder.
If you have planned to drag the builder to the consumer forum, you may very well go ahead by refusing to sign the proposed undertaking.
It will be unjustified if he is focing yo to accept the building in an as is where is condition and you cannot protest it.
Dont accept is terms and immediately send him a legal notice to handover the fully constructed flat completed in all respects including the OC without which you are not iable to accept his terms.