SC orders Parsvnath to deposit `12 cr compensation for Gzb project delay

NEW DELHI: Clearly affirming that it takes a lot to invest one’s life savings and future earnings to get a roof above one’s head, the Supreme Court directed Parsvnath Developers on Thursday to deposit `12 crore within four weeks as compensation to the 70-odd buyers who had invested in its Ghaziabad project almost nine years ago.

This order in favour of homebuyers is one among many passed over the last few months which according to real estate experts is in line with rules of the Real Estate Regulatory Act (RERA) and an attempt to win back homebuyers’ trust. The Supreme Court has consistently been taking a stand against builders who have been selling false dreams to buyers, taking on the role of ‘Sapnon ka Saudagar’.

“Builders cannot run away with the life’s savings of homebuyers and give lame excuses that they are battling a slowdown, had not received project approvals or do not have the money to refund buyers when they have collected over 95% from homebuyers,” says advocate ML Lahoty, who appeared on behalf of the aggrieved buyers in this case. Arguing on behalf of homebuyers, Lahoty insisted that the developers should refund the money to homebuyers and told the bench that Ghaziabad Development Authority had even withdrawn the sanction for the project and that there was no possibility of Parsvnath completing the project in 12 months.

Builders cannot run away with the life’s savings of homebuyers and give lame excuses that they are battling a slowdown, had not received project approvals or do not have the money to refund buyers when they have collected over 95% from homebuyers ML LAHOTY, advocate

Realty experts also say the apex court’s order is in line with RERA norms.

“This order is practically in line with RERA and is an attempt to make developers get into the self discipline mode. It is also an attempt to instill positivity into the market and bring back the trust and confidence of homebuyers,” says Sudip Mullick, partner, Khaitan & Co.

On August 27, Parsvnath Developers had expressed inability to refund homebuyers for not handing over possession of flats, saying the company was suffering from a severe liquidity crunch but assured the court that the project will be completed in a year. The project Parsvnath Exotica was launched in 2007 with the promise of handing over possession by 2011.

Over 800 families have put in their money but flats have not been delivered.

The National Consumer Disputes Redressal Commission (NCRDC) had directed the company to refund money with interest to 70 homebuyers who had filed the case against the builder.

In a related case, the SC on September 7 had issued a warning to Supertech, when the builder expressed its inability to pay money to homebuyers who were not keen to hold on to their flats, saying it was not concerned whether the realtor “sinks or dies”.