A Chandigarh consumer commission has ordered a real estate firm and its two directors to refund Rs 62.7 lakh to a Zirakpur homebuyer couple after finding that the developer repeatedly delayed possession, stopped promised compensation and issued a possession letter despite the apartment lacking a fire safety certificate.
The State Consumer Disputes Redressal Commission, UT Chandigarh, also directed the builder to pay Rs 75,000 for mental agony and Rs 35,000 towards litigation costs. The total compensation and costs must be paid within 30 days, while the refund will carry 12% annual interest calculated from the respective dates of deposit.
Saurabh Verma and his wife, Puja Rani, had booked a 1,590-square-foot apartment for Rs 66.5 lakh in October 2022. The agreed possession date was October 31, 2023. The couple paid Rs 62.7 lakh, including Rs 40.1 lakh through a home loan, but the apartment was not delivered within the contracted period.
According to the complaint, the developer extended the possession deadline three times. The revised deadlines were set for November 2024, July 2025 and December 31, 2025, following extensions issued in September 2023, August 2024 and August 2025. The builder initially paid the couple Rs 30,000 a month as delay compensation, but stopped the payments after a year.
The commission directed that compensation paid between November 2023 and November 2024 be adjusted against the final refund. The couple had alleged that the developer also demanded additional money for finishing work despite the slow pace of construction. They claimed they were threatened with cancellation of the contract and charged 24% interest if the additional payments were not made.
The developer issued a possession letter on September 27, 2025. The buyers refused to accept it, citing incomplete construction and the absence of mandatory statutory approvals. An RTI response dated January 2, 2026, confirmed, according to the complaint, that the apartment did not have a fire safety certificate.
The commission held that a possession letter could not by itself establish that a residential unit was fit for occupation when required statutory clearances were absent. It also noted that the builder’s defence was struck off on April 16, 2026, after the firm failed to file its written reply within the prescribed 45-day period.
Relying on Supreme Court precedents, the commission said homebuyers could not be compelled to wait indefinitely for possession or accept an incomplete apartment. It observed that a builder’s obligation was not limited to constructing a structure or issuing a possession letter, but included delivering the contracted home within the agreed period, in habitable condition and in compliance with applicable statutory requirements.
The commission treated the repeated delays, discontinuation of compensation and demands for additional funds as deficiency in service under the Consumer Protection Act, 2019, and as unfair trade practices. It also highlighted that the buyers had paid nearly 95% of the apartment’s cost, leaving a substantial portion of their financial resources tied up in a home whose lawful and habitable possession had not been established. The refund, interest and compensation are now due under the commission’s order.
