Mohali flat buyers get relief from Supreme Court
In a key ruling that balances homebuyer rights and builder liability, the Supreme Court has upheld a refund with 8% compounded interest to two buyers who pulled out of a delayed Greater Mohali Area Development Authority (GMADA) housing project, but turned down their plea to recover the home loan interest they had paid.
A bench of Justices Sanjay Karol and Prasanna B. Varale delivered the ruling last week in a dispute stemming from GMADA's 'Purab Premium Apartments' project in Sector 88, Mohali. The buyers, Anupam Garg and Rajiv Kumar, had booked 2-BHK flats in 2012 and deposited ₹50.46 lakh and ₹41.29 lakh, respectively. They were promised possession by May 2015 under a Letter of Intent (LOI), which also assured a refund with 8% interest in case of delay.
Citing slow progress and major deviations from the promised layout and amenities, the buyers sought refunds in 2016. When GMADA resisted, they moved the Punjab State Consumer Commission, which in 2018 ordered GMADA to return their money with 8% interest, ₹60,000 each for mental harassment, ₹30,000 each in litigation costs, and the interest they had paid on their housing loans. This decision was upheld by the National Consumer Disputes Redressal Commission (NCDRC) in 2019.
However, GMADA contested the direction to pay for buyers' loan interest in the Supreme Court.
In its verdict, the court reaffirmed that delayed possession entitles buyers to a refund with reasonable interest. 'Where the development authority… does not deliver possession… the allottee is entitled for refund… with reasonable interest,' the bench said, citing its earlier ruling in Bangalore Development Authority v. Syndicate Bank.
The bench also quoted GDA v. Balbir Singh, saying compensation must vary with the facts of the case: 'In cases where monies are being simply returned… the compensation would necessarily have to be higher.'
However, the judges ruled out compensation under multiple heads. Citing DLF Homes Panchkula v. D.S. Dhanda, they said, 'There cannot be multiple heads to grant of damages and interest when the parties have agreed for payment of damages.' Justice Karol observed, 'The 8% interest awarded… is the compensation for being deprived of the investment… No amount of interest on the loan taken by the respondents could have been awarded.'
The court allowed GMADA's appeal in part—striking down the loan interest component but upholding the rest of the relief granted by the consumer commissions. GMADA will not have to deposit any additional sum, and the money already with the State Commission will be disbursed to the buyers.
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Time of India
23 minutes ago
- Time of India
Tenant eviction: After more than 10 years fight a landlord wins eviction case on ground of rebuilding of house property; Know how
How did this case start? August 11, 2008: Landlord filed a rent petition for eviction oftenant on the ground of bona fide requirement for the purpose of rebuilding/re-construction after demolition of existing building which was not possible without the premises being vacated. Landlord filed a rent petition for eviction oftenant on the ground of bona fide requirement for the purpose of rebuilding/re-construction after demolition of existing building which was not possible without the premises being vacated. June 30, 2011: The said petition was allowed by a court order which recognised the need of the landlord as a bona fide need. However, the court ordered that eviction of the tenant from the premises will be carried out only on production of duly sanctioned plan by the landlord before the executing court. The said petition was allowed by a court order which recognised the need of the landlord as a bona fide need. However, the court ordered that eviction of the tenant from the premises will be carried out only on production of duly sanctioned plan by the landlord before the executing court. July 3, 2012: Tenant filed an appeal against this order. The appellate authority said that until the case's trial is over, the tenant should deposit the rental amount with the rent controller which will be disturbed to the landlord subsequent to the outcome of the trial. Tenant filed an appeal against this order. The appellate authority said that until the case's trial is over, the tenant should deposit the rental amount with the rent controller which will be disturbed to the landlord subsequent to the outcome of the trial. October 4, 2012: The tenant filed a revision petition. The revised petition was dismissed with clarification that it shall be open to the tenant to apply for re-entry into the building in accordance with proviso to clause (c) of Section 14(3) of the Rent Act read in terms of the judgment of the Supreme Court in Hari Dass Sharma's case and judgment of the High Court in Civil Revision No. 49 of 2006. The tenant filed a revision petition. The revised petition was dismissed with clarification that it shall be open to the tenant to apply for re-entry into the building in accordance with proviso to clause (c) of Section 14(3) of the Rent Act read in terms of the judgment of the Supreme Court in Hari Dass Sharma's case and judgment of the High Court in Civil Revision No. 49 of 2006. July 8, 2013: The tenant's special leave petition was dismissed by the Supreme Court. The tenant's special leave petition was dismissed by the Supreme Court. June 30, 2014: The tenant again filed an application before the rent controller and this time also the case was dismissed. What does Section 14(3)(c) of the Rent Act mean? What did the Himachal Pradesh High Court say about tenant's rights in re-built properties? So far right of re-induction or to re-entry shall be subject to and have adherence to all provisions of law applicable and prevailing at relevant point of time for such re-entry including determination of fair rent or rent mutually agreed between the parties as well as proposed user and utilization of the property by the landlords. The right to re-entry of the tenant has been granted in the Act itself. However, such right definitely is not to be an absolute right, as the Courts have to determine the same keeping in view of the given facts and circumstances of the case including the purpose for which reconstruction/rebuilding of the premises has been proposed and permitted, and also keeping in view the bona fide requirement of the landlord. In case premises after rebuilding/reconstruction is to be rented, then definitely tenants shall have right to re-entry/re-induction in the premises, in accordance with law, as recorded herein. For example, if premises is ordered to be vacated for bona fide requirement of the owner to utilize the premises in better way by converting the residential building into a commercial complex, in such eventuality, tenant living in residential premises may not claim re-entry or re-induction in the newly constructed commercial complex for residential accommodation. Similarly, there may be a case where the landlord intends to expand his business and shall have a requirement of more space for commercial activity by rebuilding/ reconstructing the premises. In such eventuality also, it may not be justified to impose a tenant upon him causing curtailment of his plan of extension of his business. In a given case, a building may be proposed to be reconstructed or rebuilt for own residential purpose with no proposal to let it out. In such eventuality, a tenant cannot be thrusted upon the owner of the premises by way of re-induction or re-entry in a house particularly designed and constructed in a manner that there is no scope for letting out a portion thereof as existence of any other family in such premises may cause interference in privacy. Such re-entry/re-induction shall amount to depriving a person from his right of full enjoyment of his property for no fault on his part, but for the only reason that he or his predecessor had provided rented accommodation to someone in the past, as per circumstances prevailing at that time.' Himachal Pradesh High Court final judgement Proviso on the basis of which tenant is claiming direction for construction of building within a time frame and right of re-entry, provides therein re-entry/reinduction on new terms of tenancy, on the basis of mutual agreement between the landlord and tenant in the premises in re-built building. Therefore, for invoking this proviso, there must be a rebuilt building and new terms of tenancy finalised on the basis of mutual agreement between landlord and tenant. In present case, there is nothing on record that premises in question has been rebuilt and landlord has decided to utilize by renting out the same on certain new terms or any mutual agreement between landlord and tenant has been arrived at on the basis of new terms of tenancy or any other person have been inducted by landlord as tenant, avoiding the previous tenant. Right to re-entry has been given to bonafide tenants, who have no other option to have shelter, except the building in reference proposed to be re-built, but not a person who has no business or no cause to continue the tenancy, particularly after retirement when he has started residing in a different township/village. It is further noticeable that Supreme Court has directed to handover the possession by tenant to the landlord on or before 30.6.2014, whereas application seeking direction to the landlord was preferred prior to vacating the premises, which was and is not maintainable because before vacation of the premises by tenant, there was no question of initiating/commencing re-building/re-construction by the landlord. What precedent does this judgement set for tenants and landlords? Since 2008, a landlord had been battling in various courts to evict a tenan t and finally he won the eviction case on April 22, 2025 when the Himachal Pradesh High Court dismissed the tenant 's appeal and ordered him to vacate the landlord's High Court ruled in favour of the landlord by saying that a tenant's right to re-enter a landlord's property (post rebuilding/reconstruction) is not absolute and is based on mutual agreement and the purpose of reconstruction of the tell you in a brief about this case, it started when the landlord wanted to renovate his house by re-building it and wanted his tenant to move out. But the tenant was not ready to move out of the house and thus in 2008, the landlord filed an eviction the hearing of the eviction suit, the landlord proved his bona fide need for rebuilding/re-construction of the property and won the case. But the tenant did not give up and filed an appeal in the High Court and even a special leave petition in the Supreme Court of India. Both the High Court and Supreme Court of India rejected the tenant's appeal at that time. Still, the tenant persisted and filed yet another appeal, this time with the rent controller and then once more with the High hearing this case again, the High Court said that the right to re-enter is granted only on the bona fide requirements of tenants i.e. those who genuinely need a place to stay, like individuals who have no other shelter except for the building that is proposed to be re-built. In the case being referred to here, the tenant has alternative accommodation available but has chosen not to move High Court also said: 'Section 14(3)(c) allows a landlord to seek eviction of a tenant from the premises, if he proves a bona fide requirement of the land being reconstructed. The tenant evicted has the right to re-entry, on the basis of mutual agreement between parties and new terms of tenancy.' However, in this case no new rent agreement was signed and neither new tenancy terms were on to understand how this tenant eviction case went on for more than 10 years and what should landlords and tenants know about a timeline of events according to the order of the Himachal Pradesh High Court dated April 22, 2025:The tenant filed an appeal in the High Court soon 14(3)(c): Provided that the tenant evicted under this clause shall have the right to re-entry on new terms of tenancy, on the basis of mutual agreement between the landlord and the tenant, to the premises in the re-built building equivalent in area to the original premises for which he was a tenant.'The Himachal Pradesh High Court said that for this particular tenant eviction case the observations, made in Rattan Chand's case in following paras, are relevant:The High Court also mentioned that the tenant opted to go to court instead of filing an appeal with the rent controller appellate authority, but since this case has been pending since a long time, the High Court decided to hear this case once 'Conjoint reading of various orders passed in present matter, some of which have been upheld by the Supreme Court, with judgment of Hari Dass Sharma's case and Civil Revision No. 49 of 2006, decided on 8.7.2013, I am of the considered opinion that there is no merit in the plea taken by the tenant seeking direction to the landlord in present matter and thus there is no illegality or impropriety in impugned order.'We have asked various lawyers about what precedent does this judgement set for tenants and landlords; here's what they said:This judgment sets a clear precedent that the right to re-entry under Section 14(3)(c) of the Rent Act is not absolute. It affirms that such a right can only be exercised by a bonafide tenant/s who has no other option to have shelter/carry on business except the building in reference proposed to be re built, in the event the premises has been reconstructed and both parties have mutually agreed on the new terms in respect of tenancy of new such right to re-enter the new premises in the reconstructed building can be considered keeping in mind the landlord's purpose for re-construction,the landlord's bonafide requirement and that such right of re entry given to tenant does not deprive the landlord from his right to enjoy his right to re-entry is never absolute, and the criteria for granting re-entry must be strict. Prior to awarding the right of re-entry, several important factors will be assessed, such as determining (i) the reasonable rent for the space and (ii) the landlord's suggested use of the space. This ruling is consistent with the ratio established in several previous cases, which makes it evident that only bone fide tenants are entitled to re-entry. Before granting a tenant re-entry or re-induction, the landlord's needs and the intended use of the building must be considered. This ruling established stringent criteria that must be met before allowing a tenant to re-enter the judgment sets a precedent that strengthens the conditional nature of a tenant's right to re-entry under Section 14(3)(c) of the Himachal Pradesh Urban Rent Control Act, 1987, and emphasizes judicial discretion in balancing tenant and landlord rights based on case-specific ruling clarifies that the right to re-entry under Section 14(3)(c) is not absolute but conditional upon: existence of a rebuilt agreement between the landlord and tenant on new terms of aligns with the statutory language of the proviso and ensures that tenants cannot demand re-entry in the absence of a reconstructed building or without agreeing to new tenancy terms. The court's dismissal of the tenant's application due to the lack of a rebuilt structure and mutual agreement sets a clear standard for future judgment introduces a practical consideration that the right to re-entry is intended for tenants who genuinely require the premises for shelter or use. The court noted that the tenant, having relocated to Kandaghat after retirement, no longer had a bona fide need for the premises in Shimla. This sets a precedent that courts may evaluate the tenant's actual need for re-entry, particularly when they have alternative accommodation, to prevent misuse of the statutory court's finding that the tenant's son had no right to claim re-entry establishes that the right to re-entry is personal to the original tenant and cannot be transferred to third parties, such as family members, without the landlord's consent. This protects landlords from unauthorized claims by judgment holds that applications for re-entry or directions to the landlord to commence construction are not maintainable before the tenant vacates the premises. This sets a procedural precedent that tenants must first comply with eviction orders before seeking re-entry, ensuring that landlords are not burdened with premature court's decision to entertain the revision petition under Section 24(5) of the Act, despite the availability of an appellate remedy, highlights the High Court's discretionary power to pass such orders as it may deem fit on the legality or propriety of orders or proceedings under the ruling sets an important judicial precedent by interpreting Section 14(3)(c) in a tenant-landlord conflict where expectations of re-entry post-reconstruction were neither recorded nor mutually agreed. The Himachal Pradesh High Court has now clarified that post-reconstruction possession rights must flow from either a specific court direction, an undertaking by the landlord, or a written agreement. Absent these, the landlord is under no statutory obligation to reinstate the judgment aligns with the broader judicial trend of respecting negotiated rights over implied assumptions, especially in landlord-tenant law. It serves as a cautionary precedent for tenants relying on equitable re-entry without formalized consent. Practically, it encourages both landlords and tenants to document exit and re-entry terms at the time of eviction or court proceedings to avoid prolonged decision may influence rent control jurisprudence in other states, especially where similar provisions exist under state-specific tenancy laws, and could guide lower courts in adjudicating similar Himachal Pradesh High Court made it clear that the right of a tenant to re-enter the premises after eviction due to reconstruction is not automatic or unconditional. While the law (specifically, Section 14(3)(c) of the Himachal Pradesh Urban Rent Control Act, 1987) allows for a possibility of re-entry, it does so only on the basis of mutual agreement between the landlord and the tenant. The Court emphasized that such a right is contingent upon fresh terms being negotiated and accepted by both parties post-reconstruction. This ruling dispels the notion that tenants have a statutory right to reclaim the property in all the Act, the judgment reinforces the provisions of Himachal Pradesh Urban Rent Control Act and lays down a precedent: the right to re-entry after reconstruction is intended solely for bona fide tenants who genuinely require the re-built premises for shelter. Consequently, the right to re-entry is a conditional entitlement, granted based on a demonstrable need for shelter, thus preventing the imposition of a tenant on a landlord when the tenant exhibits no genuine requirement to continue the tenancy.
Hindustan Times
5 hours ago
- Hindustan Times
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News18
9 hours ago
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