The Telegraph
Tuesday , September 25 , 2012
Since 1st March, 1999
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Rs 90-lakh penalty slapped on builder

The state consumer redressal commission directed a real estate firm to shell out compensation amounting to Rs 90.2 lakh to a city-based retired army officer as the builders left an apartment project unfinished on the armyman’s ancestral land in upscale Upper Burdwan Compound.

The three-member panel of Dhananjay Prasad Singh, Mohan Lal Roy and Sumedha Tripathi issued the order on July 30. A certified copy of the order was made available to The Telegraph on Monday morning.

When he was five months away from retirement in January 1999, Lt Colonel L.M.N. Shahdeo, who lived in a palatial ancestral building on a 22-cottah plot of prime land, entered into an agreement with M/s Ankita Projects, a construction firm.

According to the terms, the builders were to develop a multi-storey residential building on the plot at Kali Mandir Road, Upper Burdwan Compound, within 36 months, and hand over 30 per cent of the total constructed area to Shahdeo.

Moreover, the construction firm had to conform to RRDA specifications and build the apartment with best-in-class materials.

In reality, the builder violated almost all the terms of the agreement. It violated the RRDA approved plan, which led to a case of unauthorised construction. RRDA directed the builders to stop construction, but the company flouted orders and went on to erect the five-storey Bhubneshwari Lok Apartment.

In three years, it put up the structure of 40 flats, with 10 flats in each floor of the five-storey apartment, a ground floor parking provision, and started finishing 30 flats. But it completed 28 and sold them to outside buyers.

The two unfinished flats were handed over to Shahdeo.

After this, the company stopped work on the project. Shahdeo, who was to get at least nine flats — 30 per cent of the 30 constructed units — got two unfinished ones. He had to move to a rented apartment.

When all dialogue failed, in 2005, Shahdeo knocked on the door of consumer court in 2005. He got this judgment after a protracted seven-year legal battle.

The panel asked the builders to pay Shahdeo Rs 90.2 lakh within 60 days from the date of judgment failing which it would have to pay 9 per cent interest.

The amount includes Rs 81 lakh required to finish 10 incomplete flats, Rs 7.2 lakh which Shahdeo had to spend on rent for 12 years, Rs 1.5 lakh for harassment and Rs 50,000 as litigation costs, making it one of the biggest decrees in Jharkhand against a builder.

But Shahdeo said he was not fully satisfied.

“The amount of compensation that the company has been directed to pay me is insufficient. I got two incomplete flats instead of nine. I should have given the price of seven flats which I was entitled to,” he said.

Directors of the construction company, Sanjay Kumar, Manoj Kumar and Shailendra Kumar, were unavailable for their comments.

Do most builders manage to escape penalty?


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