New Delhi: A decision of the Supreme Court has tightened the noose on the builders. A bench of Justices Uday Umesh Lalit and Indu Malhotra made it clear in its judgment that the unilateral agreement and arbitrariness of the builder will no longer work because when the home buyer is not able to pay installments or arrears, the builder imposes a fine on him that he is obliged to pay, so why no fine on the builder when he is unable to deliver the possession of house/flat on time?Also Read - US Supreme Court Halts Biden Administration's COVID-19 Vaccine Rule For Businesses

The Supreme Court in a recent verdict held that the flat buyers are entitled to compensation for “delayed handing over of possession” and for the failure of the developer to fulfil their promises with regard to amenities. The top court set aside the verdict of the National Consumer Disputes Redressal Commission (NCDRC) which, on July 2, 2019, had dismissed the complaints of 339 flat buyers by holding that they were not entitled to the compensation in excess of what was stipulated in their flat purchase agreements for delayed possession and the lack of assured amenities. Also Read - Who is Indu Malhotra, Former SC Judge to Head Panel Probing PM Modi’s Security Breach in Punjab

The bench said the flat owners are entitled to the compensation in excess of the amount stipulated in their agreements with the developers. Also Read - Return Money by Jan 17 or Face Jail: Supreme Court to Supertech Directors

The compensation amount shall be computed on the total money paid towards the purchase of the respective flats with effect from the date of expiry of thirty-six months from the execution of the respective flat purchase agreements until the date of the offer of possession after the receipt of the occupation certificate, it said.

The compensation amount shall be in addition to the money which has been paid over or credited by the developer at the rate of Rs 5 per square foot per month at the time of the drawing of final accounts, it said. The top court asked developers to pay the compensation within a period of one month from the date of this judgment and cautioned that failure in making payment, shall carry interest at the rate of nine per cent per annum until payment.

(With inputs from agency)