Ranga Reddy: Consumer panel asks Shiva Shakti Constructions to pay Rs 55000, 6% interest for not handing over flat

Hyderabad: District Consumer Disputes Redressal Commission, Ranga Reddy has ordered Shiva Shakti Constructions in Kukatpally to pay six percent interest on the advance payment of Rs 34,80,100 from January 1, 2020, till handing over the possession of the flat to the complainant.

It also ordered to pay Rs 50,000 towards compensation for mental agony and financial trauma and Rs 5,000 towards the cost of the complaint.

Case details

Gangadhar Bharadwaj, a Software Engineer and resident of Gundlapocham Palli, Medchal Malkajgiri District, was approached by Prahalad, one of the representatives from Shiva Shakti Constructions regarding the sale of flats.

On February 19, 2018, Bharadwaj signed a written agreement with the construction company, paying Rs 6,50,000 as an advance out of the total agreed amount of Rs 49,00,500 for the purchase of an apartment in `The Lawnz' at Kokapet in Rajendra Nagar Mandal of Ranga Reddy district. Besides, the 1,815 sq ft flat, the sale included parking space.

Later, Bharadwaj approached GIC Housing Finance Limited and borrowed a loan of Rs 43,00,000. Of which the GIC disbursed a loan amount of Rs 25 lakh in favor of the construction firm. The first installment amount was received and acknowledged as part of the partial payment by Shiva Shakti Constructions.

The company was asked to inform the work status of GIC Housing Finance Limited for further payments.

Bharadwaj made several efforts through mail to the construction firm to fulfill the conditions of the agreement but to no avail. Shiva Shakti Constructions agreed to complete the entire project by July 2019. The firm agreed that in case the project is delayed beyond three months, they are liable to pay damages to the complainant Rs 5 per sqft per month for the delayed period in respect of the area that is not completed.

After receiving the part payment in 2018, the construction firm did not inform about any progress of construction either to the GICHFL or to the complainant. The firm also did not demand a balance payment.

Shiva Shakti Constructions failed to adhere to RERA rules and regulations. It is even though the complainant paid pre-EMI to GICHFCL. Hence, the Bharadwaj suffered both physical and mental agony.

On August 14, 2023, Bharadwaj served a legal notice to Shiva Shakti Constructions to intimate the progress of the building to GICHFL and hand over the building after receiving the payment. Shiva Shakti Constructions received the legal notice on August 25, 2023. However, it neither gave any reply nor compiled the demands made in the legal notice. Despite receiving notices from this Commission, Shiva Shakti Constructions remained absent hence, set-ex parte.

After going through the evidence submitted by Bharadwaj, the Court decided in favor of the complainant. The Commission ordered Shiva Shakti Constructions to issue a letter to the GICHFL to release the balance loan amount to complete the pending work in the subject flat and hand over the same to Bharadwaj. It also ordered to pay Rs 5 per sq ft as admitted in the agreement of sale to the extent of 1,815 sq ft per month from the period from January 1, 2020, till handing over possession of the flat to the complainant, after completion.

The court also ordered Shiva Shakti Constructions in Kukatpally to pay six percent interest on the advance payment of Rs 34,80,100 from January 1, 2020, till handing over the possession of the flat to the complainant. It also ordered to pay Rs 50,000 towards compensation for mental agony and financial trauma and Rs 5,000 towards the cost of the complaint.