SC holds both State Commission and National Commission erred in imposing entire compensation liability on developer

SC holds both State Commission and National Commission erred in imposing entire compensation liability on developer The Supreme Court of India has modified the order of the National Consumer Disputes Redressal Commission and the State Consumer Disputes Redressal Commission, holding the Parsvnath Developers Ltd. liable to pay compensation to the respective allottees/buyers/original complainants to the extent of 70%, and the Chandigarh Housing Board (CHB) to pay 30% of the compensation in terms of clause 9(c) of the Flat Buyer Agreement.

The present appeals were filed by Parsvnath Developers Ltd. against the orders of the National Consumer Disputes Redressal Commission and the State Consumer Disputes Redressal Commission, wherein they were directed to pay the entire amount of compensation to the buyers/allottees in terms of clause 9(c) of the Flat Buyer Agreement.

The issue before the Court was whether the compensation awarded by the State Commission in terms of clause 9(c) of the Flat Buyer Agreement is payable solely by the developer or it is to be shared between the developer and the CHB in the ratio of 70:30.

The Court noted that the learned arbitrator in the award dated 09.01.2015 had specifically directed that any amount payable on account of refund of price, interest, or compensation would be borne by the appellant and the CHB in the ratio of 70:30, and the award passed by the learned arbitrator had attained finality.

Parsvnath Developers Ltd. Vs Gagandeep Brar and Another 

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