(Commonwealth) _ The Delhi High Court recently issued a significant judgment directing the National Buildings Construction Corporation (NBCC) to compensate a homebuyer with Rs 5 lakh for causing him “extreme mental agony” and to refund over Rs 76 lakh along with interest for failing to deliver physical possession of the flat he purchased. The decision, made by a single-judge bench of Justice Subramonium Prasad on May 8, underscores the court’s recognition of the severe impact on homebuyers when real estate developers fail to meet their commitments.
The petitioner, a retired government employee, had invested his life savings in purchasing a flat in the ‘NBCC Green View Apartments’ project in Gurgaon, launched by the NBCC in 2012. Despite paying the entire sale price of Rs 76,85,576 in 2017, the homebuyer was never handed possession of the flat. Instead, he was forced to endure “extreme mental agony,” compounded by the necessity of shifting accommodation and managing his living situation independently over the last seven years.
Justice Prasad acknowledged the emotional and financial burden placed on the petitioner, noting that purchasing a home is one of the most significant investments an individual or family can make. It often involves years of savings, planning, and emotional commitment. When builders fail to deliver on their promises, they disrupt the trust and financial stability of homebuyers, forcing them to face legal battles to seek justice.
The court directed the NBCC to refund the entire amount paid by the petitioner, along with interest at 12% from January 30, 2021, until the present day, within six weeks. It emphasized that compensating homebuyers is not only about rectifying past injustices but also about deterring future misconduct by builders and developers.
Justice Prasad also noted that the NBCC, being an instrumentality of the state, must act fairly and reasonably in its dealings. The court referred to the Supreme Court’s 2011 decision in the case of Noida Entrepreneurs Association vs. Noida & Ors., which held that public authorities hold the property of the public in trust and therefore must act justly and responsibly.
The court criticized the NBCC for treating homebuyers unfairly and pointed out that the petitioner had been deprived of his money for the last 10 years. The structural defects found in the construction after some residents began occupying the flats further exacerbated the situation, leaving the homebuyer and many others in uncertainty.
The court expressed dissatisfaction with the NBCC’s offer to return only the principal amount without any interest, labeling it a mere “pittance” in the eyes of the law. Additionally, the court acknowledged the fact that land prices in the National Capital Region (NCR) have been increasing rapidly, further highlighting the financial loss suffered by the petitioner.
The High Court’s decision sets an important precedent for homebuyers who have been subjected to similar hardships by real estate developers. It signals the judiciary’s willingness to hold builders accountable for their commitments and protect the rights of homebuyers. This judgment emphasizes the need for transparency, fairness, and accountability in the real estate sector and aims to deter future misconduct, ensuring that homebuyers receive the justice they deserve.
In conclusion, the Delhi High Court’s ruling sends a clear message that real estate developers must fulfill their obligations to homebuyers. By compensating the petitioner for his ordeal and ordering the NBCC to refund his money with interest, the court underscores the importance of safeguarding the interests of homebuyers and maintaining the integrity of the real estate industry.
