How to register a complaint against a builder

239 votes

A grievance or complaint against a builder can arise due to several reasons such as delay in handing over the possession, construction of the house not according to agreed specifications, extra charges higher than the agreed amount, etc. It is commonly advised that you remain diligent when you are dealing with your builder and take notice of the builder's work, performance, and quality of products and services, compliant to the plan, etc.

However, if a complaint arises, there are several ways through which you can address the same under the Indian legal system. Such as filing a case before the consumer court or under the RERA (Real Estate Regulations Act), 2017. You can also file your complaint with the CREDAI (Confederation of Real Estate Developers Association of India) which is a regulatory body for builders and real estate developers.
 

How to file a complaint under the Consumer Protection Act, 1986?

Any buyer of property through builder is a consumer coming under the purview of the Consumer Protection Act of 1986 and can avail the rights of a consumer under the Act. Thus, a complaint against a builder can be filed before the appropriate consumer court. For registering a complaint, you have to prepare a petition stating the facts and evidence with the help of a lawyer and file it against the builder. The court after hearing both sides will pass a judgment which shall be binding on all the parties.
 

How to file a complaint under the RERA ACT?

RERA (Real Estate Regulatory Authority) was established to protect the interest of home-buyers against the malpractices of the unfair business of the builders under the RERA Act. The act specifies the rules and regulation which are to be followed by the builders and real estate agents.

Under the Act, you can file your complaint either with the Real Estate Regulatory Authority or with an adjudicating officer. A complaint under RERA has to be filed in a format that is prescribed by the respective states where it is being filed.  Once your complaint is filed, the Competent Authorities will look into your case. If they find any activity that is against the provisions of the RERA Act, they can order the builder to stop such activity or provide compensation to the affected person. Any order passed by the RERA authorities is binding on the builders. It is advisable to hire a good property lawyer while filing a complaint under the RERA Act.
 

How to register a complaint against a builder through CREDAI?

CREDAI is a regulatory body of builders, developed to administer the working and dealing of builders and to control the increasing number of fraudulent actions performed by the builders in the industry. It works to promote the interest of builders as well as investors and to bring transparency in the dealings between the two. CREDAI sets a code of conduct for every member to abide by.

Under CREDAI, you can directly approach the builder if there is a complaint. It is necessary for a builder to be a CREDAI member for a complaint to be filed against him. CREDAI has established Consumer Grievance Redressal Forums where an affected buyer can register his complaint against the builder. You can file a complaint online, directly on their official website. The processing fee for filing a complaint is Rs 2000/- and in no case, more money can be demanded. In case the builder is found guilty, he is obliged to pay this amount. Once the complaint is received, it is sent to the builder for his reply. If the complainant is not satisfied with the reply of the buyer, then he has to inform the committee. The committee will then call both parties together and will try to resolve the matter with a mutually acceptable order.

CREDAI functions just like a mediator, however, a member is obliged to comply with its verdict. If in case, he does not comply with it, CREDAI can cancel his/her membership and expel him/her.

Thus, the affected home-buyer can file a complaint using any of the above-mentioned three ways.
 

LawRato LawRato

774 votes

Recently, at Power to Consumer we have seen a rise in the number of complainants approaching us to file a case against a builder. Many of them have similar grievances such as delay in possession of their property, mute responses from the developer, unfinished projects due to litigation issues, absconding builders, poor quality construction so on and so forth.

We already covered the topic of compensation due to delay in handing over projects. We decided to write this post to make the general consumer aware of pitfalls in dealing with a builder, and how can they take the support of legal process to fight them back.

Builders are amenable under the Consumer Protection Act, 1986
As per a landmark decision passed in 1993 in the case of Lucknow Development Authority vs. M.K.Gupta, the Honourable Supreme Court of India passed a judgement stating that “all builders/contractor(s)/all concerned authorities of any State engaged in Housing Construction activity in any manner are amenable to Consumer Protection Act, 1986 for any act or omission relating to housing activity such as:

“Delay in delivery of possession, non-completion of construction within the stipulated time, defective and faulty construction and more…”
Premium Legal SupportThe judgement states the fact that a builder who constructs a house or hires the services of a contractor to develop a property is engaged in the act of providing service to his customer, and for which he is getting monetarily compensated. This makes him a service provider and hence liable under the clauses of Consumer Protection Act, 1986.

A list of situations under which a property buyer can file a case:
The International Consumer Rights Protection Council has listed down the following grounds in which a property buyer can drag an incompetent property developer to the Consumer Court:

Non-execution of relevant sale agreement despite having received a substantial advance amount
Non-issuance of copies of all relevant documents viz.; development agreement, power of attorney, sanctioned plan (by concerned Regional Authorities), specification of construction materials/design as per sanctioned plan and any other relevant documents
Charged higher than the agreed amount
No issuance of proper receipt(s) against the paid amount
Poor quality construction
Delivering of a house not complying to agreed specifications
No free parking space within the premises
Did not form a co-operative housing society and handed over to members
Non-provision of water storage tank
Non-provision of proper ventilation and light
Delayed possession beyond the stipulated time limit
Not obtaining completion certificate from the concerned registered (by the authorities) architect
Non-issuance of Occupancy Certificate at the time of delivery of respective flats/house to its occupants
Non-declaration of expenses against which the developer collected money
And many more…
Any project falling short of above listed causes can be referred to Power to Consumer prior to taking delivery of the property from the concerned builders so that we can take up the matter as a pre-litigation issue.

How to file a complaint against a builder in the Consumer Court?
With builders coming under the clause of being a service provider, the process of filing a consumer court complaint against them is the same as with other service providers. To file a complaint, you need to adhere to the following steps:

Send a well drafted Legal Notice to the builder stating your reasons of discontent
Await for a response for the stipulated time from the other party
On no-response, prepare a petition stating facts and evidences with the help of expert legal advice
Approach the Consumer Court and file your petition against the builder

Advocate Siddhant Sharma LawRato