The failure of a developer to hand over possession or execute an agreement for a booked flat after receiving consideration constitutes a continuing wrong, and a unilateral cancellation of the booking by the developer during pending legal uncertainty regarding the land does not absolve them from their contractual obligations.

JUDGMENT

(Date : 18/03/2026)

Per: Hon’ble Ms. Poonam V. Maharshi, Member

1. The complainants, Mr. Sanjeev S. Sadhale, Mrs. Sunita S. Sadhale, have filed the present consumer complaint under section 17 of the Consumer Protection Act, 1986 alleging deficiency in service and unfair trade practice on the part of the opposite parties who are developers of a housing project.

2. The complainants state that the opposite parties launched a residential project known as “Runwal Infinity”. Relying upon the representations and brochure issued by the opposite parties, the complainants booked Flat No.2102 in Building No. A-1, Runwal Infinity admeasuring about 1016 sq. ft. carpet area (saleable area about 1505 sq. ft.), situated at L.B.S. Marg, Mulund (West), Mumbai for a total consideration of about Rs.49,66,500/-.

3. It is the case of the complainants that they paid part consideration towards the said flat from time to time. Initially, they paid Rs.5,00,000/- through cheque on 14/11/2005 drawn on Bank of Baroda and the opposite parties issued receipt dated 14.11.2005. Thereafter, the complainants issued other cheques dated 15/11/2005 for Rs.5,00,000/- for which the opposite parties also issued receipt dated 16/11/2005. The opposite party by letter dated. 08/09/2010 admitted booking of the flat and accepted Rs.10,00,000/-.

4. According to the complainants, despite receipt of Rs. 10,00,000/- the aforesaid substantial amount, the opposite parties failed to execute the Agreement for Sale after receipt of more than 20% of the total consideration amount. The opposite parties failed to comply with section 4 of MOFA 1963.They neither completed the construction of the building nor handed over possession of the booked flat. The complainants repeatedly approached the opposite parties and requested them to execute the agreement and proceed with the project; however, the opposite parties did not comply with the said requests.

5. The complainants further state that by letter dated 08.09.2010, the opposite parties informed them that the land on which the project was to be constructed had been declared as private forest land, due to which the Municipal Corporation had issued a stop-work notice dated 18/05/2006 and the matter had been taken before higher courts. On that ground the opposite parties expressed their inability to commit any time frame for completion of the project and sought to cancel, recind and revoke the booking and called upon the complainants to collect the refund amount from them and that the complainants shall have no right title and interest in the said flat.

6. The complainants have stated that with malafide and dishonest intention, the Opposite Parties issued a letter dated 8th September 2010 to the complainants to take undue advantage of the situation of the market price which had sky rocketed and opposite parties are taking undue advantage of the said high rate which is more than double the price of the flat booked by the complainants ,thereby seeking to stop them from pursuing their claim in respect of the flat and purported to cancel the booking. The complainants contend that the said letter is illegal, contrary to settled law and that the Opposite Parties had no authority to unilaterally cancel the booking of the complainants’ flat after accepting substantial consid