Homebuyer Forced to Run from Pillar to Post After Life Savings Sunk into Unfinished Project - Delhi High Court Ordered to refund the Entire Payment With Interest

The Delhi High Court, in a significant ruling, addressed the plight of a homebuyer who had invested his life savings into a housing project by National Buildings Construction Corporation (NBCC) only to face years of uncertainty and legal battles due to the non-completion and structural defects of the property. The court emphasized, "A helpless homebuyer has no other option but to knock door after door hoping against hope that he would be able to get his money back."

Legal Point of the Judgement: The court addressed the issue of non-delivery of possession of a flat by NBCC despite full payment. It also dismissed a contempt petition against NBCC for alleged non-compliance with court orders to provide temporary compensation to the petitioner.

Facts and Issues Arising: The petitioner, a retired government employee, had booked a flat in NBCC Green View Apartments in 2012. Despite completing payments by 2017, he was neither given possession of the flat nor provided a suitable alternative or refund. The buildings in the project were later found to have structural defects necessitating evacuation, further complicating the petitioner’s circumstances.

Non-Delivery and Compensation: The court noted the extreme hardship faced by the petitioner, who was compelled to seek temporary accommodations while fighting for his rights. Justice Subramonium Prasad remarked, "Such a person faces financial crunch to ensure proper education to his children and such a situation he has no other option but to knock on the doors of various forums hoping to get relief."

Forum Shopping: Addressing the respondent’s accusation of forum shopping against the petitioner, the court found that the petitioner's actions stemmed from desperation and a dire need for relief, rather than manipulative legal strategizing.

State’s Duty and Fair Treatment: The judgment highlighted the role of state-run enterprises like NBCC in acting fairly and responsibly, underlining that such bodies should not just aim to defend their actions legally but also ensure justice and fair treatment to individuals affected by their operations.

Compensation for Mental Agony: Recognizing the mental stress and turmoil endured by the petitioner, the court ordered additional compensation. "In view of the fact that the Petitioner has been forced to shift accommodation and fend for himself in the last seven years and has been put to extreme mental agony, this Court is inclined to direct the NBCC to pay a sum of Rs.5 lakh to the Petitioner," Justice Prasad declared.

Decision of the Court: The High Court allowed the writ petition, directing NBCC to refund the entire payment made by the petitioner with an interest rate of 12% from January 30, 2021, till the date of the order, along with a compensation of Rs. 5 lakhs for mental agony. The contempt petition regarding non-compliance of earlier court orders by NBCC was dismissed, noting NBCC's efforts in complying with the directives.

Date of Decision: May 8, 2024

Sanjay Raghunath Piplani And Anr. vs. National Buildings Construction Corporation Delhi And Anr.