MUMBAI: A recent case underscores the challenges homebuyers face with stalled real estate projects. The Maharashtra State Consumer Disputes Redressal Commission (SCDRC) in Mumbai has ordered a developer and its directors to refund over ₹45 lakh plus ₹15 lakh in interest to a couple who had their flat allocation canceled in a Wadala housing project they opted for back in 2014.
Sharmistha Ray and Manabendra Nath Ray, residents of Wadala, had initially sought 18% annual interest on their payment but agreed to 9% before the commission, which was the initial rate offered by the developer.
The commission found Vijaykamal Properties Private Limited and its directors, Jayesh Shah and Ketan Shah, at fault for deficient service. “The opposing parties admitted to receiving partial payment from the complainants for the flat. Due to ongoing litigation and technical issues, the project was never completed, leading to the cancellation of the complainant’s flat allocation. Thus, the opposing party displayed deficient service and engaged in unfair trade practices,” the commission stated.
Represented by advocate Mahesh Menon along with advocates Aakansha Anand and Pranav Chavan, the Rays revealed that the flat’s total cost was ₹71 lakh. Between booking in 2014 and cancellation in 2018, they paid ₹45 lakh to the developer for a unit in the ‘Gaurav Sarjan’ project slated for construction in Antop Hill, Wadala (East).
According to their complaint, the Rays never received possession of the flat. After serving a legal notice in March 2018, they were informed on August 1, 2018, that their allocation was canceled due to “multiple litigations and technical difficulties.” Their subsequent complaint in 2019 arose from the developer’s failure to return their advance, leading the Rays to seek a refund with 18% interest, ₹8 lakh for mental distress, and ₹6 lakh in compensation.
During the hearing, the developer and directors acknowledged receiving partial payment but proposed a refund with 9% interest, claiming this was the agreed rate at booking. They accused the Rays of having a “greedy attitude” and trying to “extract more money” by insisting on their terms, although they maintained their willingness to issue the refund with 9% interest.
