Developer pulled up over club, parking fees

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The National Consumer Disputes Redressal Commission, New Delhi (NCDRC), has held that club and basement parking areas are common to all allottees and, therefore, the developer is not entitled to recover charges for them.

In Capital Greens Flat Buyer Association & Ors v DLF Universal Ltd & Ors, DLF Universal was developer of DLF Capital Greens, Moti Nagar, in New Delhi, which has 2,870 residential apartments in 23 residential towers. The complainant society comprising allottees of apartments approached the NCDRC seeking possession of the allotted apartments, and also sought a refund of the charges recovered from the allottees for providing car parking, club facilities and service tax.

The issues before the NCDRC were regarding disputes raised by the allottees vis-a-vis club charges, car parking charges, compensation in delays to offering possession, and force majeure circumstances.

The NCDRC held that a club meant primarily for providing sports and recreational facilities to its members would form part of the common areas and facilities. Regarding car parking and basement parking charges, it was held that as per section 3(j)(iii) of the Delhi Apartments Ownership Act, 1986, a basement is included in the definition of common areas and facilities, and a basement does not lose its character merely on account of the use to which it is put.

Likewise, parking areas, irrespective of whether such areas are open or covered, whether they are provided on the surface or in the basement, would be a part of the common areas and facilities in relation to a multi-storied building.

Based on these facts, the NCDRC held that the developer was not entitled to recover charges for the club area and car parking area from the allottees, and that it would be for the association of apartment owners to regulate its use by the allottees. It was further held that car parking charges and club charges, if already paid to the developer, shall be refunded to the allottees within three months.

The NCDRC further ordered that DLF shall pay compensation for the delay in possession of apartments in the form of simple interest of 7% per annum from the expected date for delivery of possession until the date on which the possession was actually offered to the allottees. In the case of subsequent purchasers, the period expected for the delivery of possession will be computed from the date of purchase by them.

The dispute digest is compiled by Bhasin & Co, a corporate law firm based in New Delhi. The authors can be contacted at lbhasin@gmail.com. Readers should not act on the basis of this information without seeking professional legal advice.