Delay in Projects: What NRIs Can Do?
Aug 26, 2016 Legal Guidance
‘Delay’ is one main factor people worry about when it comes to purchasing a house that is under construction. There have been cases in the past where delays in delivery of projects have been witnessed. This is one reason why people now days are opting more for ready-to-move-in-houses. The real estate market has been witnessing a stagnant phase due to developers unable to finish their concerned projects on time. The element of delivery affects the most to the Non-resident Indians i.e. NRIs as they are not able to look into the credibility of the builders or developers like the other who reside here. To cite a few examples, one of them is the protests that took place in the year 2013 where the NRI buyers from Germany and Singapore protested against the Kolkata, West International City Township. They all flew here to protest.
Let’s look into the things which NRIs can do when his or her builder is delaying the delivery of projects.
The builder will have to pay an amount of compensation to the buyers if the property is not timely delivered to the homebuyers as this has been mentioned in the clause which is written when the builder and buyer agreement is made.
However, often there are cases where the loss that the buyers incur is way more due to the delay by the builder. In such a case the buyer should approach the consumer court for help. Let’s take an example of the Gurgaon case, where the developer delayed the project which was to be delivered within three years from 2009-2010 but later it was seen that they were to be ready only by 2017 or 2018. Here, the National Consumer Disputes Redressal Commission asked the builders to pay 12 percent of the cost of the flat per annum for each year of delay the builder made. Even though the builder and buyer agreement mentions compensation of 1.8 percent but due to the huge delay this compensation was increased.
A buyer can also go to the consumer dispute Redressal commissions where at there at the district level, state level and the central level to file for their complain and seek help. The district Redressal takes care of good and property which is less that Rs 20 lakh, the state takes care of good and property within the range of Rs 20 lakh to Rs 1 crore, whereas the central Redressal handles the goods which cost more than Rs 1 crore.
It is advisable to the NRIs that they do a thorough research before they invest in a property abroad. They can ask their friends or family living in that country also to do the credibility research on the developers. Along with that NRIs should carefully read the buyer and builder agreement before agreeing to it and pay special attention to the clause which state for compensation in case of delays.
Let’s look into the things which NRIs can do when his or her builder is delaying the delivery of projects.
The builder will have to pay an amount of compensation to the buyers if the property is not timely delivered to the homebuyers as this has been mentioned in the clause which is written when the builder and buyer agreement is made.
However, often there are cases where the loss that the buyers incur is way more due to the delay by the builder. In such a case the buyer should approach the consumer court for help. Let’s take an example of the Gurgaon case, where the developer delayed the project which was to be delivered within three years from 2009-2010 but later it was seen that they were to be ready only by 2017 or 2018. Here, the National Consumer Disputes Redressal Commission asked the builders to pay 12 percent of the cost of the flat per annum for each year of delay the builder made. Even though the builder and buyer agreement mentions compensation of 1.8 percent but due to the huge delay this compensation was increased.
A buyer can also go to the consumer dispute Redressal commissions where at there at the district level, state level and the central level to file for their complain and seek help. The district Redressal takes care of good and property which is less that Rs 20 lakh, the state takes care of good and property within the range of Rs 20 lakh to Rs 1 crore, whereas the central Redressal handles the goods which cost more than Rs 1 crore.
It is advisable to the NRIs that they do a thorough research before they invest in a property abroad. They can ask their friends or family living in that country also to do the credibility research on the developers. Along with that NRIs should carefully read the buyer and builder agreement before agreeing to it and pay special attention to the clause which state for compensation in case of delays.
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