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CHANDIGARH STATE CONSUMER DISPUTES REDRESSAL COMMISSION, U.T.
Raj Shekhar Attri, President and Preetinder Singh, Member
Jagtar Singh – Appellant
versus
Omaxe Chandigarh Extension Developers Pvt. Ltd. – Respondent
First Appeal No. 298 of 2025
(Against the Order dated 21st August 2025 in Complaint DC/AB1/44/CC/698/2020 of the District Consumer Disputes Redressal Commission Chandigarh District Commission)
Decided on 21.1.2026

Advocates:
Counsel for the Parties:
For the Appellant:Sh. Devinder Kumar, Advocate
For the Respondent:Sh. Arjun Sharma, Advocate

IMPORTANT POINT
One-Sided Clauses are Not Binding – When a builder charges high penal interest for payment defaults by the buyer, providing a significantly lower compensation for their own breach constitutes a “one-sided” contract. Consumer Commissions have the authority to bypass such clauses to award just and fair compensation.

Headnote:

Consumer Protection Act, 2019 – Section 2(7) – Consumer – Housing – Enhancement of Delay Compensation – Unconscionable Contractual Clauses – Complainant, a subsequent allottee of a residential unit in “Omaxe Cassia,” appealed for the modification and enhancement of relief granted by the District Commission – The original order awarded compensation at a contractual rate of Rs.10/- per sq.ft. per month for a delay of over 24 months – Appellant contended that this rate was meager and sought interest on the total deposited amount instead – State Commission found the contractual penalty clause to be one-sided, unreasonable, and unconscionable, noting that builders typically charge much higher interest for allottee defaults than they pay for their own delays – Relying on Supreme Court precedents (DLF Homes Panchkula Pvt. Ltd. v. Himanshu Arora), the Commission held that just and fair compensation in cases of inordinate delay should be linked to the amount deposited – The Commission modified the order, enhancing the delay compensation to 9% p.a. interest on the total amount deposited and significantly increasing the compensation for mental agony and litigation costs – A builder cannot limit its liability for delayed possession to a meager contractual rate (e.g., Rs.10/- per sq.ft.) if such a clause is found to be unconscionable – When a builder charges high penal interest for payment defaults by the buyer, providing a significantly lower compensation for their own breach constitutes a “one-sided” contract. Consumer Commissions have the authority to bypass such clauses to award just and fair compensation – Commission upheld the appellant’s status as a “consumer” despite the respondent’s objection regarding an affidavit-cum-undertaking signed during the transfer of allotment – Commission clarified that once a builder accepts a transfer and recognizes the new buyer, and subsequently fails to deliver possession within a reasonable timeframe (deficiency in service), the buyer retains the right to seek legal remedy regardless of restrictive undertakings signed under the pressure of completing the transfer.

ORDER

Raj Shekhar Attri, President.—The complainant (appellant in this appeal) by way of filing this appeal is seeking modification of the relief already awarded to him, vide order dated 21.08.2025 passed by the District Consumer Disputes Redressal Commission-II, U.T., Chandigarh (in short the District Commission), in consumer complaint bearing no.698 of 2020. Following relief has already been granted by the District Commission while allowing the said consumer complaint:—

“...12] In view of the above discussion, the complaint of the complainant is partly allowed and the opposite party is directed as under:—

i) To pay Rs.4,24,925/- to the complainant (i.e. compensation @ Rs.10/- per sq.ft. per month for the super area 1725 sq.ft i.e. Rs.17250/- per month for the delayed period of 24 months 19 days with effect from 30.12.2014 to 18.01.2017).

ii) To pay Rs.10,000/- to the complainant as compensation for the harassment caused as well as litigation expenses.

The above said order shall be complied with by the opposite party within a period of 45 days from the date of receipt of certified copy of this order.

13] The pending application(s) if any, stands disposed of accordingly....”

2. Before the District Commission it was the case of the complainant that one Mamta Shelke had booked an independent ground floor unit in the project of the opposite party, namely “Omaxe Cassia”, by paying a sum of Rs.8 lakhs inclusive of taxes on 01.03.2011. As per the receipt dated 01.03.2011 issued by the opposite party (Exhibit C-1), the property was described as OCIF/P/1725/327. After about nine months, the opposite party had issued a provisional allotment letter dated 23.12.2011 (Exhibit C-2), provisionally allotting an independent floor on plot No.762/GF admeasuring approximately 300 sq. yards with a built-up area of 1725 sq.ft., as per the tentative layout plan. Subsequently, on 29.12.2012, an Allotment Letter for Residential Independent Floor in Cassia within the Residential Township Project “Omaxe New Chandigarh” (Exhibit C-3) was executed between the opposite party and Ms. Mamta Shelke. The basic cost of the unit was fixed at Rs.54,00,009/-. As per Clause 23(b) of the allotment letter, the opposite party had agreed to make its best efforts to complete construction within 24 months from the date of signing of the allotment letter, with a further grace period of six months, subject to force majeure conditions and timely payments by the allottee. Clause 23(h) further stipulated that in case of delay attributable to the opposite party, compensation @ Rs.10/- per sq.ft. per month on the super area of 1725 sq.ft. would be payable for the period of delay. In March 2014, the complainant had approached the original allottee for transfer of allotment rights. Accordingly, all relevant transfer documents (Exhibit C-4 colly) were executed on 20.03.2014 before the opposite party. Thereafter, the complainant had made payments towards the unit on different dates as per the demands raised by the opposite party, details whereof were supported by demand letters and receipts (Exhibits C-5 to C-12). On 19.01.2017, the opposite party had issued a possession offer letter (Exhibit C-13) along with a demand of Rs.3,89,336/- , which was duly paid by the complainant on 15.02.2017 (Exhibit C-14). At the time of payment, the complainant had requested adjustment of the delay compensation against the outstanding amount; however, the opposite party had assured refund of the same in cash. Relying upon the said assurance, the complainant had accepted possession after a delay of about 25 months, but the opposite party had failed to pay the agreed compensation. It was pleaded that upon visiting the site, the complainant had found that basic amenities were lacking and construction was still incomplete. Possession had allegedly been offered without obtaining the completion certificate from the competent authority. As per the allotment letter, possession ought to have been d

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