Buyer can opt out of delayed housing projects, rules consumer panel

The National Consumer Commission on Saturday held that a buyer is entitled to opt out of a housing project if there is a delay in delivery of possession of the house by the real-estate developer.

The buyer is also entitled to a full refund with reasonable interest and any deduction on the amount is unjustified, the commission said.

"The petitioner was fully justified in opting out of the [hire-purchase] scheme and demanding refund of the money that she had paid along with interest," the commission said in response to a petition filed by Agra resident Indira Gupta seeking quashing of the Uttar Pradesh State Consumer Commission's direction to deduct 20 per cent from the amount to be refunded to her by the Agra Development Authority.

"We direct that Rs66,000 along with 15 per cent interest be paid to Gupta by the authority, as ordered by the district forum, within six weeks along with Rs2,000 as cost of litigation," the commission bench headed by the president, justice Ashok Bhan, said.

"The fact that the authority had erred in not giving possession of the house to Gupta as envisaged under the scheme and in the absence of any rules and regulations by which 20 per cent could be deducted from the refunded amount, we are unable to uphold the order of the state commission and therefore set it aside," the commission said.

It noted that the authority admitted that there had been a long delay in completing the development work and construction of the houses. "Even after several years, the project could not be fully completed," the commission said.