Builder told to pay Rs 2 lakh compensation to consumer

The District Consumer Redressal Forum has ordered a builder to pay a compensation of Rs 2 lakh to a man after the developer failed to return the advance amount of Rs 45,000 paid by him towards booking a flat which he cancelled later.
Ordering the compensation to a Mulund resident, Santosh Patil, who had booked a flat in Casa Rio Complex of Lodha Developers, Forum president Umesh Jhavalikar and its member N D Kadam said the builder was deficient in providing service.
Patil had booked the flat on August 14, 2011 and made a payment of Rs 45,000. However, he cancelled the booking on August 24, 2011 due to ill health and some domestic reasons and sought refund of the amount by sending e-mail to the builder.

Patil said in his complaint that the builder refused to refund the advance of Rs 45,000 by taking recourse to the conditions as interpreted by the builder. He then approached the Forum seeking compensation of Rs 4.97 lakh, including the advance payment made by him.
"The compensation is for mental sufferings, losses and legal expenses incurred by the complainant as the respondent had made a demand for the balance amount towards the cost of the flat despite the fact that the complainant had cancelled the booking," the Forum said in its order.
The Forum allowed Lodha Developers to deduct a sum equivalent to ten per cent of the initial booking amount (Rs 45,000) as retention money.

All these payments have to be made within 30 days from the date of the order which was issued in last week of June.

Lodha Developers argued that the complaint needs to be dismissed as Patil was not at all its consumer.
However, the Forum said, "Only if it is a security deposit then the builder can go for forfeiture of the same else he is bound to refund the advance payment made after deducting the retention amount of 10% as per the clause in the conditions as laid down while making the allotment.
The Forum also referred to the ruling of the Supreme Court, National Consumer Forum, and the Bombay High Court on non-refund of the advance and security deposit to arrive at the conclusion.

The Forum also observed that "the respondent has violated the conditions in the allotment of flat and was deficient in services towards the complainant.