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2025 (4) TMI 878 - SC - Indian LawsAllotment of flats on payment of balance due to the builder and also requisite registration charges to be paid to the Competent Authority - HELD THAT - It is almost 2 years and 10 months and according to the learned counsel for the builder not a single flat has been sold by the Court Commissioner so appointed by the NCDRC. The submission made by the learned counsel on behalf of the builder is that in case liberty is granted to the builder to sell the flats directly and the direction contained in the order dated 18th April 2022 of not permitting the builder to sell and further provide that the sale to take place through Court Commissioner be modified as the same is not benefitting either of the parties. He further submitted that the builder would sell the apartments within one year and deposit the entire sale consideration with the NCDRC for being disbursed to the claimants. The above liberty may be granted subject to terms and conditions as may be fixed by this Court. There are substance in the submission of the builder. However it is not inclined to fix any terms and conditions and would leave it for the NCDRC to determine the same. Accordingly the order dated 18th April 2022 is modified and withdraw the directions to the NCDRC to put the sale of flats through Court Commissioner and further we withdraw the direction restraining the builder or any associate from selling the flats. Conclusion - The NCDRC is empowered to regulate the sale of flats impose appropriate conditions and monitor the proceedings to protect the rights of buyers and the builder alike. Application disposed off.
1. ISSUES PRESENTED and CONSIDERED
The core legal questions considered by the Court include:
2. ISSUE-WISE DETAILED ANALYSIS Issue 1: Alleged Contempt for Non-Compliance of Order dated 2nd September 2022 Relevant legal framework and precedents: Contempt proceedings arise when a party wilfully disobeys or disregards a Court order. The Court's order mandated allotment of flats and execution of conveyance deeds upon payment of balance dues and registration charges. Court's interpretation and reasoning: The Court examined whether the builder had failed to comply with the order. The builder contended that the applicants had not cleared the outstanding dues despite demands, which prevented allotment and execution of sale deeds. Key evidence and findings: The builder's submission that dues remained unpaid was accepted. The applicants did not dispute the existence of dues but challenged their quantum as excessive. Application of law to facts: Since the order required allotment and sale deed execution only after payment of dues, the builder's non-compliance was attributable to the applicants' failure to pay. This negated any wilful disobedience by the builder. Treatment of competing arguments: The applicants argued the demands were arbitrary and excessive, seeking Court intervention to reduce them. The Court declined to entertain this contention, directing the applicants to approach the Real Estate Regulatory Authority (RERA) for resolution of disputes regarding dues. Conclusions: The Court concluded that the builder was not in contempt. The contempt petition was dismissed and proceedings closed. Issue 2: Challenge to the Quantum of Demands Raised by the Builder Relevant legal framework and precedents: Disputes over demands made by builders are generally within the jurisdiction of regulatory authorities such as RERA, which are empowered to adjudicate on reasonableness and compliance with contractual and statutory obligations. Court's interpretation and reasoning: The Court expressly refrained from adjudicating on the reasonableness of the demands, emphasizing the availability of an appropriate remedy before RERA. Key evidence and findings: No detailed evidence was examined by the Court on this issue as it was considered outside the scope of the contempt proceedings. Application of law to facts: The Court maintained the separation of jurisdiction, directing the applicants to seek relief through RERA rather than the contempt forum. Treatment of competing arguments: The Court rejected the applicants' plea for reduction of demands within the contempt petition context. Conclusions: The Court declined to interfere with the demands and closed the contempt proceedings accordingly. Issue 3: Modification of Order dated 18th April 2022 Regarding Sale of Flats Relevant legal framework and precedents: The original order entrusted the NCDRC with ensuring sale of flats through a Court-appointed Commissioner and restrained the builder and associates from selling the flats directly. This was intended to protect the interests of flat buyers and ensure transparency. Court's interpretation and reasoning: The builder submitted that nearly three years had elapsed without any flats being sold by the Court Commissioner, causing stagnation and prejudice to all parties. The builder sought liberty to sell the flats directly, with the sale proceeds deposited with the NCDRC for distribution. Key evidence and findings: The Court noted the delay and lack of progress in sales through the Court Commissioner, accepting the builder's submission that the arrangement was not benefiting either party. Application of law to facts: Balancing the interests of the parties and the need for expeditious resolution, the Court found merit in modifying the order to permit direct sale by the builder, subject to oversight by the NCDRC. Treatment of competing arguments: While the original order sought to protect buyers by restricting sales to a Court Commissioner, the practical failure of that mechanism justified reconsideration. The Court declined to impose specific terms and conditions, instead leaving the NCDRC empowered to regulate the sale process and impose safeguards. Conclusions: The order dated 18th April 2022 was modified to withdraw directions restraining the builder from selling flats directly and to remove the requirement of sale through a Court Commissioner. The NCDRC was entrusted with monitoring the sale process and imposing conditions to safeguard the interests of all parties. Issue 4: Role and Powers of NCDRC in Execution Proceedings Relevant legal framework and precedents: The NCDRC, as a consumer dispute redressal forum, has jurisdiction over execution and enforcement of orders involving consumer matters, including real estate disputes. Court's interpretation and reasoning: The Court emphasized that the NCDRC shall exercise its discretion to deal with execution proceedings on merits, keeping in mind the interests of both parties. Key evidence and findings: The Court recognized the NCDRC's expertise and authority to impose conditions, explore alternative sale methods, and monitor the entire sale process to ensure realization of best prices. Application of law to facts: The Court's delegation of authority to the NCDRC was intended to ensure flexible and effective management of the sale process, with due regard to fairness and efficiency. Treatment of competing arguments: The Court did not specify any particular mode of sale or terms but left the matter to the NCDRC's discretion, reflecting a trust in the regulatory mechanism to balance competing interests. Conclusions: The NCDRC is empowered to regulate the sale of flats, impose appropriate conditions, and monitor the proceedings to protect the rights of buyers and the builder alike. 3. SIGNIFICANT HOLDINGS The Court held:
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