Legal Remedies For Home Buyers Against Defaulting Developers
The biggest fear that any home buyer has is whether the property he invested in will be delivered on time or will the quality he is paying for, is worth it. Though Real Estate Law is going to make things convenient for aggrieved home buyers, you can also consider taking this legal course against the service provider, if you are highly unsatisfied. Here are few remedies that can work for you to fight for justice against the unfair practices of the builder-
Filing a suit in civil court
If the developer has breached the clauses of the sale agreement, the home buyer can approach the civil court and file the petition for damages caused or even the refund of the amount along with the interest under Code of Civil Procedure, 1908. This is also applicable if the builder is using unfair means or committing unacceptable practices at the time of obliging with the builder-buyer agreement. A buyer can claim the recovery of the entire amount, paid by him. However, a civil case takes a long time as compared to other recourses and even the court fee has to be paid equivalent to the amount claimed. For a claim amount of up to Rs 2 crore, district courts can entertain the plea while for higher claims, High Courts have the pecuniary jurisdiction. This is exclusive of the lawyer's fee and court fee.
According to the Consumer Protection Act, 1986, a home buyer can file a complaint against the builder within two years from the date of dispute at the Consumer Forum. The complaint can be the deficiency in the services on the builder's part, as provided in the builders-buyers agreement. However, the complaint can be filed only by the consumer and a buyer is considered to be a consumer only when he buys the house for his end-use and not for the commercial purposes.
Also Read: How to File A Case in Consumer Court
Competition Commission of India (CCI)
A buyer can file a complaint with CCI if the builder is using his dominant position to suppress buyer's demands or for their disadvantages. The complaint can be filed against the abuse of dominant position as per the Competition Act, 2002. CCI investigates the builder's deeds and unfair practices and imposes penalties if found guilty. Since CCI is very active in real estate sphere, many developers in the past have been fined with a hefty fine to be paid to the buyers. Though CCI is approachable and works in fast-track mode, the amount is difficult to recover as the builder often appeals against the CCI order in the court. The approximate cost of filing the complaint with the CCI is Rs 5,000
The allottee can also file a criminal case against the builder for cheating, breach of agreement and not attend to the grievance under Indian Penal Code, 1860. The buyer can issue a notice to the builder and if the notice remains unanswered; buyer can approach the criminal court. Moreover, the complainant should also present the proof of irregularities done by the builder. Though the trial is very fast, both the parties have to be present during the hearing and a bailable and non-bailable warrant can also be issued, in the case of non-appearance.
Arbitration can only take place if there is a clause of arbitration, Arbitration and Conciliation Act, 1996. in the builder buyer's agreement. No lawyer is needed to pursue the case under this clause. The time taken is three-six months from the date of initial demand of issuance. However, the biggest disadvantage of choosing arbitration over other legal remedy is the fact that the arbitrators may be biased.