After finding that a Ghaziabad-based cooperative housing society (CHS/the society) failed to hand over possession of flats booked more than 15 years ago, the Delhi state consumer disputes redressal commission has directed the society to refund ₹79.43 lakh to two home-buyers, along with an interest of 8.25%pa (per annum) and ₹5 lakh in compensation and litigation costs. It held Sanchar Nest Sahkari Awas Samiti guilty of deficiency in service and unfair conduct for repeatedly delaying a housing project while continuing to raise financial demands on the buyers.
In an order last week, a bench comprising justice Sangita Dhingra Sehgal (president) and Bimla Kumari (member) said, "...it is an admitted position that the agreements between the parties were executed in the year 2013. It is clear from the record that possession of the flats remained undelivered for several years, even prior to the outbreak of the Covid-19 pandemic in 2020. Therefore, the contention regarding Covid-19 raised by the opposite party (Sanchar Nest Sahkari Awas Samiti) to justify the inordinate delay in handing over possession is devoid of merit and is accordingly rejected. Consequently, we hold that the opposite party is deficient in rendering services to the complainants by failing to hand over possession of the flats within a reasonable period and keeping the amounts deposited by the complainants for almost 16 years from the date of the agreements."
The commission observed that, despite substantial payments made by the complainants, including through housing loans, the society neither delivered possession of the promised flats nor refunded the amounts collected from them.
The dispute arose from bookings made by Parmod Kumar Mahopatra and Mahender Singh Bisht in 2010 for two 3BHK flats in a residential project initially proposed in Noida.
According to the complainants, possession was originally promised by 2012. However, following disputes relating to land acquisition, the society shifted the project to another location in Ghaziabad. Fresh agreements were executed in 2013 and the cost of the flats was revised.
Despite the change in location and revised commitments, construction allegedly remained incomplete for years.
The commission noted that the CHS continued to extend the completion timeline while simultaneously raising additional financial demands under various heads.
The commission found that the complainants had consistently complied with payment demands and had even availed home loans to finance their purchases.
"The opposite party continued extending the date of completion and simultaneously raised additional demands under different heads, thereby increasing the financial burden upon the complainants," the order noted.
"It is also evident that while the complainants duly fulfilled their obligations by making payments as demanded and by availing loan facilities for the said purpose, the opposite party failed to fulfil its obligation of delivering possession of the flats within a reasonable period of 42 to 48 months from the date of the Agreements despite receipt of the aforesaid substantial amount," the commission added.
The society had challenged the maintainability of the complaint and raised objections regarding jurisdiction.
However, the commission held that a cooperative housing society undertaking construction and allotment of flats qualifies as a service provider under the consumer protection law.
The bench also clarified that the availability of remedies under real estate laws does not bar homebuyers from approaching consumer forums for relief.
Further, it held that failure to hand over possession constitutes a continuing cause of action, enabling buyers to seek legal remedies even after prolonged delays.
The commission rejected the society's attempts to justify the delay by citing factors such as land disputes, escalating construction costs, environmental restrictions and the COVID-19 pandemic.
It observed that no convincing evidence had been produced to substantiate these claims. The bench also pointed out that the project had already suffered extensive delays long before the outbreak of the pandemic.
Directing the housing society to refund the money deposited by the complainants, the commission ordered payment of ₹39.08 lakh to Mr Mohapatra and ₹40.34 lakh to Mr Bisht, aggregating to ₹79.43 lakh.
The refunded amounts will carry interest at 8.25%pa, linked to the applicable home loan rate, calculated from the dates of individual payments until 8 June 2026, provided the society makes the payment on or before 8 August 2026.
If the refund is not made within the stipulated period, the amount will attract a higher interest rate of 11.25%pa until full realisation, the bench said.
In addition, the commission awarded compensation of ₹2 lakh each to the two complainants for mental agony and harassment, along with litigation costs of ₹50,000 each.
The total compensation and litigation costs amount to ₹5 lakh.
The ruling reinforces the principle that developers and housing societies cannot indefinitely retain homebuyers' funds while failing to deliver promised homes, and that consumers are entitled to seek redressal for prolonged delays and deficient service.
(Complaint Case No24/2024 Date: 8 June 2026)
