New Delhi | In a significant ruling, the Delhi Consumer Commission has directed a Ghaziabad-based housing society to refund over ₹79 lakh to two homebuyers and pay ₹5 lakh as compensation for failing to deliver possession of flats even after more than 15 years of delay. The commission held that not handing over possession within the promised timeframe clearly amounts to “deficiency in service” and causes both financial and mental hardship to consumers.
According to the case details, the complainants had become members of a proposed 3BHK housing project in Noida in 2010. At the time of booking, the developer had assured possession by 2012. However, the project failed to meet deadlines and was later shifted from Noida to Ghaziabad due to a land dispute. During this period, the cost of the flats was also revised upward from around ₹24 lakh to approximately ₹28.7 lakh.
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The homebuyers stated that they continued making payments over the years, including through housing loans, as the society repeatedly demanded additional amounts. Eventually, the two complainants paid ₹39,08,865 and ₹40,34,234 respectively, significantly higher than the initially agreed prices.
In 2019, after nearly six years of delay, allotment letters were issued to the buyers. However, physical possession of the flats was never handed over. Following continued non-delivery, the matter was taken before the consumer commission for relief.
The bench, comprising Justice Sangita Dhingra Sehgal (President) and Member Bimla Kumari, observed that the explanation offered for the delay was not acceptable. The commission stated that failure to deliver possession within 42 to 48 months constitutes clear deficiency in service. It further noted that the developer failed to provide documentary evidence supporting its claims of land disputes, rising costs, environmental restrictions, or COVID-19 related delays.
The housing society argued that being a cooperative body, it could not be treated as a service provider under consumer law. However, the commission rejected this contention, stating that a cooperative society falls within the definition of a “person” under the law and is liable when services are offered in exchange for payment.
The developer also argued that the dispute should fall under the Real Estate Regulatory Authority (RERA) framework. The commission dismissed this argument as well, citing Supreme Court precedents that allow consumers to pursue remedies either under RERA or consumer protection laws.
The commission observed that the society retained the deposited funds for nearly 16 years without delivering possession, which amounted to serious negligence and unfair practice. It ordered a full refund of ₹39,08,865 to one complainant and ₹40,34,234 to the other, along with 8.25% annual interest from the date of each payment until June 8, 2026.
The order further stated that if the society fails to comply by August 8, 2026, the interest rate will increase to 11.25% until full payment is made. Additionally, the commission awarded ₹2 lakh each for mental harassment and ₹50,000 each for legal expenses, taking the total compensation to ₹5 lakh.
The ruling is being viewed as a strong reminder to real estate developers about timely project delivery and accountability toward homebuyers, reinforcing consumer rights in long-delayed housing projects.
