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If home buyer opts out, builder must refund most amount: NCDRC
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If home buyer opts out, builder must refund most amount: NCDRC
Publish on : 2020-07-03 12:18:05
NEW DELHI: A home-buyer will have to forfeit only the earnest money paid at the time of booking a flat and the builder has to refund the rest of the amount if the buyer decides not to take possession of a flat, the National Consumer Disputes Redressal Commission (NCDRC) has ruled. It also said one-year delay in completion of a housing project is reasonable and a buyer cannot seek refund of money on that ground. While adjudicating a dispute between real estate company Emmar MGF and a home-buyer who refused to take possession of a flat in its housing project in Gurgaon and sought refund of money, a bench of Justice V K Jain said the company cannot enforce its agreement as per which it was allowed to define the forfeit money and deduct other charges while refunding the amount. The NCDRC said such agreement was not enforceable as it was “one-sided” in favour of the builder at the cost of the interest of homebuyers. It held that only the amount paid at the time of booking should be non-refundable and the builder has to refund the rest of the amount. In this case, a couple had booked a flat worth around Rs 1.68 crore and paid Rs 10 lakh at the time of booking in 2013. They subsequently paid over Rs one crore through bank loan, but decided to get the money refunded when the builder offered possession in 2018 after a delay of 14 months. “The complainants paid an initial amount of Rs 10 lakh to the builder for booking a residential flat allotted to them. The said amount being the initial deposit made by them would constitute earnest money despite definition to the contrary given in the buyer agreement executed between the parties. The builder, in my opinion, should deduct only a sum of Rs 10 lakh out of the total amount received by it,” Jain said in his order. “As regards the terms of the agreement executed between the complainant and the builder, such agreements being wholly one-sided constitutes an unfair trade practice and, therefore, cannot bind the flat buyer,” it said. It, however, rejected the plea of the home-buyer who sought refund with interest for delay of around 14 months in completion of the project.

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