Builder Delay Scam: Definition, Remedies, Required Documentation & Consequences
The Builder Delay Scam involves intentional delays in completing construction projects, breaching contractual obligations, and violating the trust of buyers or investors. It is a deceptive practice that undermines the rights and interests of the affected parties.
How Y/our Lawyer helps in Fighting Builder Delay Scam ?
Our consultant will discuss the issue over a 24X7 helpline .
Step 1
Our consultant will discuss the issue over a 24X7 helpline .
Step 1
A detailed analysis of your case will be done by an experienced lawyer.
Step 2
You will be able to track your case with a personal account
Step 3
Overview
After thorough analysis, we have identified the prevalent frauds in the industry and compiled a list of effective remedies for each:
Misrepresentation of Property: Developers often misrepresent key aspects of the property, such as its location, amenities, or legal status. To address this, buyers should conduct independent verification, seek legal advice, and, if necessary, file a complaint with the appropriate regulatory authorities.
Delayed Possession: Builder delays in delivering the promised property within the agreed timeline are a common concern. Buyers can explore legal options such as approaching consumer forums, filing a case for compensation, or invoking penalty clauses as specified in the agreement.
Unauthorized Change in Plans: If developers make unauthorized changes to the property’s specifications, layout, or design without prior consent, affected buyers can seek legal recourse for breach of contract and claim appropriate compensation.
Non-Adherence to Building Regulations: Developers who violate building regulations and fail to obtain necessary approvals put buyers at risk. Buyers can file complaints with local authorities, seek legal action, or approach real estate regulatory bodies to address such non-compliance issues.
Non-Refund of Booking Amount: If a developer refuses to refund the booking amount in case of cancellation or fails to fulfill the agreed conditions, buyers can pursue legal remedies and approach consumer forums or civil courts for appropriate relief.
Fraudulent Financial Practices: Some developers engage in fraudulent financial practices, such as diverting funds meant for a specific project to other ventures. Buyers can report such instances to regulatory authorities and take legal action to safeguard their investments.
It is crucial for affected buyers to gather all relevant documentation, seek legal advice, and explore the available dispute resolution mechanisms to ensure their rights are protected and remedies are pursued effectively.
Procedure
How we Support in Filing Complaints and Resolving Issues
Centric’s RERA consulting team comprises highly adaptable and experienced professionals. We possess extensive practical knowledge and expertise in handling various issues and litigations related to RERA before different RERA authorities. Our consultancy services encompass the following:
- RERA registration for projects and agents
- Filing and resolving RERA complaints
- Ensuring RERA compliance
- Providing RERA advisory services
- Representing clients before RERA authorities
- Offering other related advisory support
Despite the increasing demand and promises made, there is no guarantee of timely fulfillment. Delayed possession remains a major source of conflict between builders and homebuyers.
Numerous instances have emerged where developers exceeded the stipulated project completion time, causing financial loss to buyers. Factors such as delayed government approvals, obtaining completion certificates, procurement delays for raw materials like cement and steel, and manpower shortages contribute to project delays and hinder timely handover to customers.
Irrespective of the reasons, project delays impact the overall financial planning of developers and directly affect buyers. If buyers have availed a home loan for their flat, they must bear pre-EMI payments until they receive possession of the property.
Buyers can only claim tax rebates under sections 24(b) and 80(c) of the Income Tax Act, 1961 after acquiring ownership and commencing EMI payments. Until then, they do not receive any tax relief for the pre-EMI period.
As a result, buyers are burdened with bank EMIs as well as the rent for their current residence. The financial loss and mental distress they endure cannot be compensated except by granting them physical possession of their homes.
In addition to delayed possession, there are various other complaints against developers, including deficiencies in services, faulty amenities, ceiling leakages, flawed drainage systems, incomplete fire safety measures, substandard electrical wiring, inadequate water provisions, and failure to provide occupation certificates.
At Centric, we are committed to assisting clients in filing complaints and addressing these issues to ensure fair resolution and protect their rights.
To Conclude
Including a one-sided penalty clause is another unjust practice often employed by developers. In many cases, the agreement features a penalty clause that imposes an 18% penalty on the buyer for delayed payments towards the purchase of a flat. However, when the builder is responsible for the delay in delivering the same flat, the compensation rate they offer is a meager 1-2%, clearly showcasing an unbalanced and unfair contract.