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Realtors say ruling on delayed handover of flats not one-size-fits-all

Raghavendra Kamath/Mumbai 17 May 19 | 01:27 PM

Real estate developers and industry consultants said the National Consumer Disputes Redressal Commission's (NCDRC) order that homebuyers can seek a refund if the handover of a flat is delayed by more than one year should be implemented on a case-by-case basis.

The commission’s ruling came after a hearing on a plea filed by a Delhi resident, Shalabh Nigam, who bought a flat in Gurugram in 2012. When the developer Orris Infrastructure and 3C company did not deliver the flat after the agreed 36 months and grace period of six months, Nigam approached the commission, reports said.

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The commission directed the builder to pay compensation at the rate of 6 per cent on the total deposit for the delayed period even after handing over the possession. In the non-deliver of the flat within the deadline stipulated by the commission, the developer has to pay the entire amount with a 10 per cent interest, reports said.

Niranjan Hiranandani, chairman of Hiranandani Constructions, said: “I think it should be a case to case basis. If a project is ready and the developer is awaiting an occupational certificate, then they should not be held responsible."

Anuj Puri, chairman of Anarock Consultants, said if the delay is due to some wrongdoing of developers, they should be penalised, but not if it's because the project is awaiting approvals.

“Many times, developers get approval requirements in the middle of the projects which they did not anticipate before. It might create problems if homebuyers seek refund for a delay in those cases," he said, adding homebuyers could exploit the ruling by seeking a refund if the price appreciation has not happened.

Rajiv Talwar, chairman of National Real Estate Development Council (Naredco) and chief executive officer of DLF, said: “People in places who do not understand trade cycles are overdoing their authority. While we respect the order, they should consult the industry and not kill the industry with their orders. If it is a simple interest of 6 per cent, it is perfectly fine," he said.

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