City Civil Court Orders Builder to Deposit Rs. 28 Lakh for Failure to give Timely Possession of Flat

Civil and Commercial Law General Civil Suits and Litigation

Posted by: Aditya Pratap on 2024-03-03

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The City Civil Court of Greater Mumbai (Now Mazgaon) had in a judgement dated 30 April 2022, had issued an Interim Injunction directing Mumbai builder M/s Srushti Raj Enterprises and its proprietor Chinnaiah Gowda to deposit a sum of Rs. 28 lakh with the Court. The said order of injunction was passed in a suit filed by an aggrieved flat buyer who had not received possession of his apartment for over ten (10) long years.

Facts of the Case - Booking of Flat in Builder's Project in Tilak Nagar in Chembur, Mumbai:

Appearing for the Plaintiff, Advocate Aditya Pratap argued that his client, the Plaintiff had booked Flat No. 801, 8th Floor, B Wing in the redevelopment project known as Building No. 93 situated on 13th Road, Tilak Nagar, Chembur, Mumbai - 400089. The total price consideration for the said flat was Rs. 62,00,000/- (Rupees Sixty Two Lakh Only) out of which advance payment to the extent of Rs. 28,00,000/- (Rupees Twenty Eight Lakh Only) was made by the Plaintiff at the very outset.

Failure of Developer to Execute Registered Sale Agreement at the time of booking the Flat:

Arguing for his client, Aditya Pratap argued that the payment of Rs. 28 lakh made by his client represented 45 per cent of the entire flat consideration value. This exceeded the 20 per cent threshold stipulated under Section 4 of the Maharashtra Ownership Flats Act of 1963 (or MOFA Act, 1963) in short.

Since the advance payment made by the Plaintiff exceeded the 20 per cent threshold, the Developer was under statutory obligation to execute a registered agreement for sale. However, the Developer violated Section 4 of MOFA Act 1963 by failing to execute a registered sale agreement with the Plaintiff.

Builder fails to give timely progress updates to the Homebuyer Plaintiff - Project remains a complete Non-Starter: