REPORTABLE  
                        
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
  CIVIL APPEAL NO. 4690 OF 2022
(Arising out of SLP (C) NO.19226 OF 2021)
UTPAL TREHAN   .... APPELLANT(S)
VERSUS
DLF HOME DEVELOPERS LTD.        .... RESPONDENT(S)
WITH
CIVIL APPEAL NOS. 4691­4692 OF 2022
(Arising out of SLP (C) NOS.5871­5872 OF 2022)
     J U D G M E N T
ANIRUDDHA BOSE, J.
Leave   is   granted   on   the   limited   question   which   was
formulated by this Court at the time of issue of notices, by the
order passed on 3 rd
 January 2022 in SLP (C) No.19226 of 2021.
So   far   as  SLP   (C)   Nos.5871­5872  of   2022   are   concerned,   leave
is   granted   on   the   point   on   which   the   appellants   thereof   had
confined their grievances, recorded in our order passed on 19 th
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April,   2022.   We   shall   refer   to   these   points   later   in   this
judgment.   The   controversy   which   we   shall   address   in   this
judgment   revolves   around   the   quantum   of   compensation   that
the  appellant  in  SLP  (C)  No.19226 of 2021 (now appeal)  would
be entitled to receive because of delay in delivery of possession
of   a   flat   as   also   the   appellant’s   obligation   to   pay   maintenance
charges in respect thereof. 
2. The specific disputes giving rise to these appeals relate to
an   Apartment   Buyers’   Agreement,   executed   on   3 rd
  December,
2008 between Utpal Trehan (whom we shall henceforth refer to
as “allottee”) and DLF  Home Developers Limited (we shall refer
to   them   as   the   “builder”)   for   purchase   of   a   flat,   within   a
complex named New Town Heights in Sector­91, Gurgaon (now
Gurugram),   Haryana.   This   was   booked   by   the   allottee   on
depositing   a   sum   of   Rs.5   lakhs   in   March   2008.   The   allotment
letter was issued on 16 th
 April 2008, and allocation was made of
Apartment   No.   GBD­153   along   with   its   parking.     As   per   the
Apartment   Buyers’   Agreement,   the   area   of   the   flat   was   to   be
1760   square   feet   (super   area).   The   consideration   amount   was
Rs.45,12,000/­,   to   be   paid   as   per   instalment   payment   plan
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forming   part   of   the   Agreement.   The   stipulation   relating   to
possession of the flat is contained in Clauses 11 and 17 of the
said   Agreement.     A   copy   of   the   draft   Agreement   has   been
annexed to the allottee’s paper book. In substance, the time for
possession   has   been   stipulated   to   be   within   36   months   from
the   date   of   execution   of   the   Agreement   subject   to   certain
qualifications   and   exceptions   incorporated   in   the   Agreement
itself. This date of delivery of possession, along with the effects
thereof,  underwent   certain   changes, as  there  was  delay  on   the
part of the builders in getting certain regulatory clearance. Mr.
Pinaki   Mishra,   learned   Senior   Advocate   has   appeared   for   the
builder and the allottee has appeared in person before us.
3.   The facts forming genesis of the grievances of the allottee
have   been   summarised   in   the   decision   of   the   National
Consumer   Dispute   Redressal   Commission   (“National
Commission”)   delivered   on   23 rd
  July   2021,   which   is   under
appeal   before   us.   We   quote   below   the   relevant   passages   from
this decision:­
“ 12.   …..   The   allotment   letter   dated   16.04.2008   and
Annexure­3   to   the   Apartment   Buyer’s   Agreement
dated   03.12.2008   provided   a   "Time   Linked   Payment
Plan”   under   which   95%   of   the   sale   consideration
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(including   Rs.   5,00,000/­   of   booking   amount)   had   to
be   paid   in   11   instalments   starting   from   29.05.2008
and   ending   on   29.06.2010.   Vide   Clause­12   of   the
Allotment   Letter   dated   16.04.2008   and   Clause­11   of
Apartment  Buyer's  Agreement  dated  03.12.2008, the
possession  had  to  be  handed  over within 36 months
from   the   date   of   agreement.   Environment   Clearance
Certificate was delayed as such the builder could not
start   construction   till   May,   2009,   i.e.   more   than   one
year from booking. In such circumstances, the builder
through  letter dated  26.03.2009,  amended  the  terms
of the agreement and the payment of the instalments
were   changed   as   “construction   Linked   Payment
Plan ”.   The   builder   has   simultaneously   provided
various  benefits  to  the  buyers, i.e. Advance  Payment
Rebate in the shape of interest at the rate of 13% p.a.
on   the   amount   in   excess   of   35%   of   sale   price   as   on
26.03.2009, 5% discount of basic sale price, increase
of   approximately   5%   area   and   compensation   for
delayed   possession   @   Rs.10/­   per   Sq.   ft.   per   month
from   the   date   of   expected   possession   till   actual
possession and Timely Payment Rebate, equivalent to
10%   basic   sale   price.   Letter   dated   23.06.2009   and
statement of account dated 10.06.2013 prove that the
benefits of (i) Rs.9059/­ as Advance Payment Rebate ,
(ii)   Rs.  1,98,000/­  as  5%  discount   of  basic   sale  price
and   (iii)   increase   of   5%   area   have   been   given   to   the
complainant. 
13.   The   complainant   argued   that   “Timely   Payment
Rebate”   and   “compensation   for   delay   in   possession ”
had not been given in statement of the account dated
10.06.2013 ,   for   which   he   was   entitled.   The   builder
has denied the Timely Payment Rebate on the ground
that   in   spite   of   service   of   demand   letter   dated
29.12.2011,   the   amount   due   was   not   deposited   till
last  date  i.e.  18.01.2012,  rather   it  was   deposited  on
27.01.2012  (without  including  the   amount   of  interest
accrued   on   it   in   the   meantime).   As   the   time   was
essence   of   contract   and   this   instalment   was   not
deposited   in   time   as   such   the   complainant   was   not
entitled for Timely Payment Rebate.”
(quoted verbatim from paperbook)
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We   shall   discuss   separately   the   position   of   the   respective
parties as regards obligation of the allottee to pay maintenance
charges.
4. The   allottee   had   approached   the   Delhi   State   Consumer
Disputes   Redressal   Commission   (“State   Commission”),   in   the
month   of   May   2015,   after   the   builder   had   raised   additional
demands   under   different   heads.   As   per   the   allottee,   the   total
sum,   as   demanded,   added   upto   Rs.9   lakhs   approximately.
Otherwise, the allottee claims to have had cleared the requisite
instalments.     At   that   point   of   time,   the   main   complaint   of   the
allottee   was   of   being   deprived   of   certain   payment   related
benefits   on   being   offered   possession   of   the   flat.     He   was   being
denied these benefits, since as per the builder, the allottee had
made default in payment within the due date on demand of the
developer of the ensuing instalment. As would be apparent from
the   said   passages   of   the   decision   under   appeal,   the   builder’s
contention   is   that   by   a   notice   of   29 th
  December   2011,   the
allottee   was   to   pay   the   next   instalment   by   18 th
  January   2012,
but   this   was   paid   on   27 th
  January   2012.   The   builder   thus
alleged nine days’ delay.  The allottee’s  stand on this count, on
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the other hand, was that he had not received the notice of 29 th
December   2011,   but   on   receiving   a   reminder   on   22 nd
  January
2012, he cleared the dues on 27 th
 January of that year.
5. The   delivery   and   payment   stipulations   were   modified   on
account   of   delay   in   getting   environmental   clearance   and   these
modifications, as made by the builder, has been summarised in
the   passage   quoted   above   from   the   National   Commission
decision.   So,   we   are   avoiding   a   repeat   of   these   modification
terms in this judgment.
6. Before  the  State  Commission,  the   allottee  prayed  for  the
following reliefs:­
“4.   …….   i.   Give   the   possession   of   the   said   flat   at   the
earliest.
ii.  Pay an amount of Rs. 10,00,000/­ as compensation for
causing   mental   trauma   and   agony   to   complainant   due   to
delay in giving the possession.
iii.   Also   pay   additional   delayed   possession   rent   @   Rs.
15/­ sq. ft. till the possession is offered to complainant.
iv.   Further   waive   of   the   undue/unjustifiable   demand
already raised towards the final dues settlement.
v.   To pay Rs. 50,000/­ towards the expenses incurred by
the complainants towards telephonic communications and
personal visits made to OP since 2006. 
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vi.   To pay a sum of Rs. 75,000/­ towards the payment of
litigation expenses.”
(quoted verbatim from paperbook)
7. During   pendency   of   the   proceeding   before   the   State
Commission, an application was filed by the builder to bring on
record   certain   subsequent   events.   What   was   sought   to   be
brought   on   record   included   crediting   to   the   allottee
compensation   for   delayed   possession   of   Rs.4,22,816/­,   Timely
Payment   Rebate   of   Rs.4,02,076/­   and   interest   of   Rs.14,082/­.
This application also highlighted that certain sum of money was
already   credited   to   the   allottee’s   account   under   the   head   of
Early Payment Rebate. This application also showed the liability
of   the   complainant   (i.e.   the   allottee)   of   Rs.3,16,899/­   as
maintenance   charges,   Rs.96,000/­   as   IBM   charges   and
Rs.14,18,203/­   as   holding   charges.   The   said   application
appears   to   have   been   filed   subsequent   to   an   attempt   at
mediation   while   the   dispute   was   pending   before   the   State
Commission.
8. The State Commission found that there was deficiency in
service and the complaint was allowed in following terms:­
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“20. ……   i.   OP shall issue fresh offer of possession of the
apartment in question i.e. GBD­153, New Town Heights in
Sector­91, Gurgaon to the complainant and shall handover
the possession of the apartment to the complainant within
a period of 06 weeks. 
ii.   OP   shall   also   execute   the   sale   deed/conveyance   deed
and   get   it   registered   in   the   name   of   the   complainant   on
payment   of   stamp   duty,   registration   charges   and   other
incidental   charges,   if   any,   by   the   complainant,   within   a
period of one month thereafter.
OP shall pay to the complainant the delayed compensation
@   Rs.   10/­   per   sq.   ft.   per   month   for   the   delayed   period
from the agreed date of possession i.e. March, 2011 till the
date   of   fresh   offer   of   possession   after   adjusting   the
delayed compensation already paid to the complainant.”
(quoted verbatim from paperbook)
9. On   the   question   of   maintenance   charges,   however,   the
State Commission went against the allottee, holding : ­
“ 19.   As   regards   payment   of   Rs   3,16,899/­   towards
maintenance charges, and Rs.14,18,204/­ toward holding
charges   @   Rs.   10   per   square   feet   till   11.10.2018,   as   is
stated   in   the   aforesaid   handing   over   the   cheque   issued
earlier a new cheque can be issued against the same. 
As   on   date,   the   complainant   is   liable   to   make   the
following payment as per the agreement:
i. Maintenance charges (till 30.09.2018) – Rs.3,16,899.
ii.   IBMS   (Interest   Bearing   Maintenance   Security)   –   Rs.
96,000/­
iii.   Holding   Charges   (@   Rs.   10/­   per   sq.   ft.   till
11.10.2018) – Rs.14,18,203/­.
However, upon suggestions from this Hon’ble Commission,
the   opposite   party   shall   consider   waiving   the   holding
charges accruing day by day and hence, nothing remains
payable   to   the   opposite   party.   The   maintenance   security
and the maintenance charges incurred towards upkeep of
the   multi­storey   building   as   mentioned   above   shall   be
payable   to   the   Condominium   Association   who   are
maintaining   the   property   inquestion   since   the   date   the
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property   was   ready   for   possession   and   was
conveyed/offered to the complainant.”
(quoted verbatim from paperbook)
10. One   of   the   critical   issues   which   was   examined   by   the
State   Commission   was   as   to   whether   there   was   any   delay   in
payment   of   instalment   by   the   allottee   upon   demand   being
made.     This   question   arose   as   the   builder   had   denied   certain
benefits   to   the   appellant   which   would   have   accrued   to   him   if
timely   payment   of   instalments   was   made   on   demand.   The
builder alleged that the demand in this case was made on 29 th
December 2011 requiring the allottee to make payment by 18 th
January  2012. As we have  already  discussed, the  allottee took
the   plea   that   the   letter   of   29 th
  December   2011   was   never
received by him and when he received a reminder letter of 19 th
January 2012 on 22 nd
  January 2012, he made the payment on
27 th
  January   2012,   factoring   in   certain   holidays   which
intervened.   The   State   Commission   examined   this   issue   and
gave   a   finding   on   fact   that   the   material   on   record   did   not
establish   that   the   demand   notice   of   29 th
  December   2011   was
served   on   any   adult   family   member/known   person   of   the
allottee   and   that   the   developer   had   failed   to   prove   service   of
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demand   notice   upon   the   allottee.   The   State   Commission   thus
held   that   the   allottee   could   not   be   deprived   of   the   benefits
outlined   in   the   builder’s   letter   of   26 th
  March   2009   on   the
allegation of failure to pay instalment within due date. 
11. The   appeal   of   the   allottee   to   the   National   Commission
was  mainly  against   the  finding   given  by  the  State  Commission
on maintenance charges. The builder questioned legality of that
part of the decision of the State Commission under which they
were directed to issue fresh offer of possession and payment of
delayed compensation.
12. The   National   Commission   partly   allowed   both   the
appeals, inter­alia holding:­ 
“In   view   of   aforementioned   discussions   First   Appeal   No.
1530 of 2019 is partly allowed and First Appeal No. 1638
of 2019 is partly allowed. DLF Home Developers Ltd., (the
builder) is directed to (i) offer possession of the apartment
in   dispute   to   the   complainant   afresh   and   hand   over
possession to the complainant within 6 weeks and execute
the  sale/conveyance  deed  in his  name, within one  month
thereafter, on payment of stamp duty, registration charges
and   other   incidental   legal   charges,   (ii)   pay   compensation
for   delay   in   possession,   i.e   interest   @   Rs.   6%­   per   annum
on the  sale  price  deposited  by him  for the  delayed  period
from   July,   2013   till   the   date   of   fresh   offer   of   possession,
adjusting   “Early   Payment   Rebate”   of   Rs.95,136/­   as
mentioned in statement  of account  dated  10.06.2013 and
(iii)   pay   “Timely   Payment   Rebate”   i.e   10%   of   basic   sale
price.   The   builder   is   entitled   to   realise/adjust   the
Maintenance charges, from the date of issue of Occupation
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Certificate   and   cost   of   increased   area   (i.e.   the   area
increasing   to   5%   of   the   increased   area).   The   builder   shall
pay   a   cost   of   Rs.50,000/­   to   the   complainant   to   meet   out
his litigation and other expenses.”
(quoted verbatim from paperbook)
13. So far as the allotee’s appeal is concerned, (arising out of
SLP   (C)   No.19226   of   2021)   at   the   time   of   issue   of   notice,   this
Court had passed the following order:­
“Heard petitioner in person. 
Issue   notice   limited   to   the   question   of   maintenance
charges as provided for by NCDRC in the concluding part
of the order impugned. Notice may be made returnable in
four weeks.
Dasti service in addition to order in process permitted.”  
14. In the appeal filed by the builder, at the stage of issue of
notice on the petition for special leave to appeal, it was recorded
in   our   order   of   19 th
  April   2022   that   the   learned   counsel
appearing   for   the   petitioner,   (i.e.,   the   builder)   essentially
confined   his   submissions   to   the   grievance   of   the   petitioner­
developer   in   regard   to   the   directions   by   the   National
Commission and the State Commission for making ‘a fresh offer
of  possession’.  We  have  indicated  earlier   in  this  judgment  that
we are granting leave restricted to these two questions only.
15. We shall first deal with the question of directions to pay
to   the   builder   maintenance   charges.   In   the   definition   Clause
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and Clauses 19, 20 and 39 of the Apartment Buyer’s Agreement
dated 3 rd
 December 2008, it has been specified:­
“Definitions
……
Maintenance   Agency"   means   DHDL   or   association   of
allottees   or   such   other   agency/body   to   whom   the
maintenance of the Said Building/Said Complex (including
common areas and facilities) is handed over by DHDL and
who   shall   be   responsible   for   providing   the   maintenance
services within the Said Building /Said Complex and who
shall be entitled to collect the Maintenance Charges.”
“19.   Maintenance   of   the   Said   Building/Said
Complex/Said Apartment
In order to provide  necessary maintenance  services, upon
the   completion   of   the   Said   Building/   Said   Complex   the
maintenance   of   the   Said   Building/Said   Complex   may   be
handed   over   to   the   association   of   Apartment   allottees   or
such   other   agency/   body/   company/   association   of
condominium.  The   Allottee   agrees  to  execute   Maintenance
Agreement (draft given   in   Annexure  VII to this Agreement)
with   the   Maintenance   Agency   or   any   other   nominee/
agency or other body/ association of Apartment owners as
may   be   appointed   by   DHDL   from   time   to   time   for   the
maintenance   and   upkeep   of   the   Said   Land/the   Said
Building/the   Said   Complex.   This   Agreement   shall   not   be
deemed   to   be   executed   till   the   same   is   signed   by   all   the
parties.   The   Allottee   further   undertakes   to   abide   by   the
terms   and   conditions   of   the   Maintenance   Agreement   and
to pay promptly all the demands, bills} charges as may be
raised   by   the   Maintenance   Agency   from   time   to   time.
DHDL reserves the right to change, modify, amend, impose
additional conditions  in  the Maintenance Agreement at the
time of its final execution. The Maintenance Charges shall
become   applicable/   payable   from   the   date   DHDL   has
received   the   occupation   certificate/the   date   of   allotment
whichever is later.   It   is further clarified that DHDL may at
its   sole   discretion   hand   over   the   maintenance   of   the   Said
Building/   Said   Complex   to   anybody/association   of
Apartment   owners   of   the   Said   Building/Said   Complex
including   but   not   limited   to   any   body/   association   of
condominium   of   the   Said   Building/   Said   Complex,   as   the
case may be, at any time before/ after the construction of
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the   Said   Building/   Said   Complex   is   complete   either   for
each   building   or   for   the   entire   Said   Complex   and   the
Allottee specifically gives his consent to this proposal. It is
further   specifically   clarified   that   the   draft   Maintenance
Agreement,   set   out   in   Annexure   VII   to   this   Agreement   is
merely   an   indicative   Agreement   that   is   proposed   to   be
entered into with the Allottee for maintenance and upkeep
of   the   Said   Building/   Said   Complex,   however,   if   at   any
time,   after   having   taken   over   the   Said   Building/   Said
Complex,   the   said   association   of   Apartment   owners/
condominium  of association decides  to  modify, alter, add,
delete any one or more of the terms and conditions of the
Maintenance   Agreement,   the   Allottee   shall   not   have   any
objection   to   the   same   and   shall   execute   the   Maintenance
Agreement as may be required by the Maintenance Agency
or   association   of   Apartment   owners   or   association   of
condominium or its nominees or assigns.
20.  Fixation of total Maintenance Charges
The   total   Maintenance   Charges   shall   be   more
elaborately described in the Maintenance Agreement (draft
given in Annexure VII). The Maintenance Charges shall be
levied from the date of occupation certificate or the date of
allotment,   whichever   is   later   and   the   Allottee   undertakes
to pay the same promptly. It is agreed by the Allottee that
the   payment   of   Maintenance   Charges   will   be   applicable
whether   or   not   the   possession   ofSaid   Apartment   is   taken
by   the   Allottee.   The   Maintenance   Charges   shall   be
recovered on such estimated basis which may also include
the   overhead   cost   on   monthly/quarterly   intervals   as   may
be   decided   by   the   Maintenance   Agency   and   adjusted
against   the   actual   audited   expenses   as   determined   at
every   end   of   the   financial   year   and   any   surplus/deficit
thereof   shall   be   carried   forward   and   adjusted   in   the
maintenance   bills   of   the   subsequent   financial   year.   The
estimates   of   the   Maintenance   Agency   shall   be   final   and
binding   on   the   Allottee.   The   Allottee   agrees   and
undertakes  to  pay the maintenance bills on or before due
date as intimated by the Maintenance Agency.
……
39. Association of apartment owners
The   Allottee   agrees   and   undertakes   to   join   association/
society   of   apartment   owners   as   may   be   formed   by
DHDL/Company   on   behalf   of   Apartment   owners   and   to
pay any fees, subscription charges thereof and to complete
such   documentation   and   formalities   as   may   be   deemed
necessary by DHDL/ Company for this purpose.”
13

(quoted verbatim from paperbook)
16. Annexure   VII   to   that   Agreement   appears   at   Page   185   of
the   paperbook   in   SLP   (C)   No.   19226   of   2021,   which   is   in   the
form   of   a   draft.   The   actual   copies   of   the   Agreements,   if
executed,   have   not   been   annexed   to   the   paperbooks   filed   in
either   of   these   two   appeals.   No   material   has   otherwise   been
produced   before   us   to   show   if   the   Maintenance   Agreement
(Annexure VII to the main Agreement) was executed or not. Be
that   as   it   may,   even   if   we   proceed   on   the   basis   that   the
maintenance   Agreement   is   applicable,   the   same   constitutes   a
tripartite   Agreement   involving   the   builder,   New   Town   Heights
Condominium   Association,   a   registered   society   and   the
purchaser. This is in the format of a standard form Agreement
with several portions thereof left blank. In the counter affidavit
of the builder, it has been stated that the maintenance charges
are   not   paid   to   them   but   to   the   statutory   condominium
association   of   allotees   who   actually   renders   maintenance
services   recovered   from   each   allotee.   That   association   to   us
appears   to   be   an   independent   body   and   there   is   nothing   on
record   to   demonstrate   that   such   association   is   an   agent   of
14

either   the   builder   or   the   purchasers.   In   Clause   39   of   the
Apartment   Buyers’   Agreement,   there   is   hint   that   such   an
Association might be formed by the builder but no particular of
its formation, or for that matter, its existence have been shown
before us at the time of hearing. 
17. The definition of Maintenance Agency means “DHDL (the
builder)   or   association   of   allottees   or   such   other   agency…….”
but   the   conjunction   “or”   as   has   been   applied   in   the   definition
clause   ought   to   mean   in   the   alternative   and   this   definition
cannot   be   construed   to   infer   that   even   after   handing   over   the
maintenance work to an association, the builder shall continue
to   remain   as   a   maintenance   agency   entitled   to   collect
maintenance   charges.   The   clause   relating   to   fixation   of   total
maintenance charges only specifies the obligation of an allottee
to   pay   such   charges   and   the   substantive   Agreement   specifies
again   that   the   maintenance   charges   would   be   payable   to   the
maintenance agency. 
18. In   so   far   as   the   subject   dispute   is   concerned,   the
builder’s case, as stated above, is that the maintenance agency
is to receive the maintenance  charges but  no specific case has
15

been made out that the builder themselves are carrying on the
maintenance   work,  which   could   have  brought   them   within   the
definition of maintenance agency under the main Agreement. In
such circumstances, we are unable to appreciate as to how, in
dealing with the allotees’ complaint against the builder, the two
statutory   fora   passed   orders   which   effectively   required   the
allotee to make over payment as maintenance charges to a third
party,   the   association   in   this   case.   We   have   already   observed
that   from   the   materials   on   record,   no   principal­agent
relationship   has   been   established   between  the   builder   and  the
association as regards the Maintenance Agreement entitling the
builder to claim and receive maintenance charges. The builder,
at   best,   is   facilitator   in   organising   a   maintenance   agency.   The
overall   obligation   of   a   flat   buyer   to   pay   maintenance   charges
may   be   derived   from   interpretation   of   clause   20   of   the   main
Agreement.   But   without   any   claim   from   the   entity,   who   are   to
render   maintenance   services   and   charge   for   the   same,   in   our
opinion,   the   two   statutory   fora   ought   not   to   have   directed   the
allottee to make payment of maintenance charges. The National
and   the   State   Commissions,   in   our   opinion,   have   committed
error   in   directing   the   allotee   to   make   payment   of   maintenance
16

charges, which ought to have been paid to the association when
there   was   no   claim   from   the   association   in   the   first   place.
Secondly, nothing has been brought to our notice from which it
could be inferred that the builder had the authority to represent
the   association   for   collecting   maintenance   charges.   On   the
other   hand,   as   we   have   already   indicated,   the   builder’s   own
case   is   that   the   maintenance   charges   ought   to   be   paid   to   the
association.   The   latter   (i.e.,   the   association)   has   not   been
impleaded   as   a   party   at   any   stage   of   these   proceedings.   Nor
they have prosecuted any claim.
19. We   must   point   out   here   that   from   the   two   orders   of   the
State   and   the   National   Commissions,   we   do   not   find   that   the
point on right of the builder to claim maintenance charges was
specifically   discussed.   In   the   complaint   before   the   State
Commission,   point   was   taken   that   in   absence   of   delivery   of
possession,   charging   for   maintenance   by   the   association   was
unjustified   but   the   principle   which   we   have   discussed   in   the
preceding three paragraphs are purely legal issues and goes to
the   root   of   the   dispute   relating   to   payment   of   maintenance
charges. Moreover, question of law formulated in paragraph 2D
17

of   the   allottee’s   special   leave   petition   (now   appeal),   in   our
opinion, is broad enough to cover this issue. While determining
rights   of   parties   on   a   question   of   law   which   emerges   from   the
pleadings   and   crystallises   for   adjudication,   we   cannot   ignore
answering   that   question.   For   otherwise,   an   incorrect   principle
of   law   may   have   to   be   laid   down   on   account   of   failure   of   the
litigants in raising it in clear terms. Moreover, the nature of the
dispute having originated from a consumers’ grievance, the role
of the Court has to be beyond just being an adjudicatory forum
in   an   adversarial   cause,   and   must   have   an   element   of
proactivity in public interest.  Having returned a specific finding
on  this  point,  we do  not  consider  it  necessary   to  deal  with  the
allottee’s   contention   that   claim   of   maintenance   charge   was
unjustified   in   absence   of   possession   of   the   subject­flat   being
delivered to them. 
20. Now   we   shall   turn   to   the   legality   of   the   decision   under
appeal   issuing   direction   upon   the   builder   to   make   payment   of
delayed   compensation.   The   provision   relating   to   delayed
compensation   is   contained   in   Clause   17   of   the   main
Agreement:­ 
18

“17.  Failure to deliver possession : Remedy to DHDL:
The   Allottee   agrees   that   if   the   construction   and
development   of   the   Said   Complex   is   abandoned   or
DHDL   is   unable   to   give   possession   within   thirty   six
(36)   months   from   the   date   of   execution   of   this
Agreement   or   such   extended   periods   as   permitted
under   this   Agreement,   DHDL   shall   be   entitled   to
terminate this Agreement whereupon DHDL's liability
shall be limited to the refund of the amounts paid by
the  Allottee  with  simple  interest  @  6% per annum  for
the   period   such   amounts   were   lying   with   DHDL   and
DHDL   shall   not   be   liable   to   pay   other   compensation
whatsoever. 
However,   DHDL   may,   at   its   sole   option   and
discretion,   decide   not   to   terminate   this   Agreement   in
which   event   DHDL   agrees   to   pay   only   to   the
Allottee(s)   and   not   to   anyone   else   and   only   in   cases
other than those provided  in Clauses 14, 15, 16 and
50   and   subject   to   the   Allottee   not   being   in   default
under   any   term   of   this   Agreement,   compensation   @
Rs.   5/­   per   sq.   ft.   of   the   Super   Area   of   the   Said
Apartment   per   month   for   the   period   of   such   delay
beyond   thirty   six   (36)   months   or   such   extended
periods   as   permitted   under   this   Agreement.   The
adjustment  of  such  compensation  shall  be  done  only
at the time of conveyancing the Said Apartment to the
Allottee   first   named   in   this   Agreement   and   not
earlier.”
(quoted verbatim from paperbook)
21. As   there   was   delay   in   obtaining   regulatory   clearance   for
the   project,   the   builder   themselves   had   made   certain
modifications   in   the   terms   of   the   Agreement,   providing   certain
benefits   to   the   flat   buyers.   This   was   done   by   the
communication   dated   26 th
  March   2009   (at   page   223   of   the
19

paper book in the allottee’s appeal). The relevant portion of this
communication reads:­
“As   far   as   "New   Town   Heights"   is   concerned,   we
would   like,   to   mention   here   that   the   necessary
Building   Plan   Approvals   for   all   the   sectors   of   “New
Town Heights” have been received. As you know, we
are   a   highly   compliant   organisation,   and   we   would
like   to  start  construction   only  after  we   have  received
the   final   Environment   Clearance,   which   is   awaited.
As soon as we receive the same, we shall commence
the construction. However, to allay any fear that you
might   have   as   far   as   the   handing   over   period   is
concerned,   we   hereby   revise   the   Compensation
Clause   No.  17  of  the   Agreement   to   Sell,   to  the  extent
of   doubling   the   Compensation   payable   to   Rs.   10/­
psft   per   month ,   as   against   Rs.   5   /­   psft   per   month,
that was applicable earlier. Similarly, if the customer
delays   in   taking   over   the   possession   once   the
possession   is   offered   by   the   Company,   he/she   shall
also   be   liable   to   pay   Holding   Charges   at   the   same
rate,   ie.,   Rs.   10/­   psft   per   month,   for   the   delay
involved in taking over the possession. 
We   stand   behind   our  promised   date   of   delivery  as   3
years, as we have already communicated earlier. We
have   amended   this   clause   to   "3   Years   from   the   date
of   booking"   instead   of   '3   years   from   the   date   of
Agreement', which was the earlier commitment.”
(quoted verbatim from paperbook)
The   direction   of   the   State   Commission   on   delayed
compensation   has   already   been   quoted   in   this   judgment.   The
National   Commission,   however,   modified   this   directive,   which
has   also   been   quoted   in   the   earlier   paragraph.   This
modification has been questioned by the allotee. 
20

22. Paragraphs   15   and   16   of   the   National   Commission’s
decision disclose the reasoning for modifying the directive of the
State   Commission   upon   the   builder   to   pay   delayed
compensation. Such modification is as regards the quantum of
compensation   and   the   relevant   part   of   the   National
Commission’s order is reproduced below:­ 
“ 15.   So   far   as   the   compensation   for   delayed
possession   is   concerned,   the   complainant   has
accepted   part   of   the   benefits   given   under   the   letter
dated 26.03.2009 and is claiming remaining benefits.
By   this   letter,   mode   of   payment   of   the   instalments
were   changed   as   “construction   Linked   Payment
Plan”.   The   construction   was   started   in   May,   2009.
After   adjusting   the   amount   till   March,   2009   and   the
benefits   given   by   the   letter   dated   26.03.2009,   on   it,
the   complainant   was   asked   to   deposit   instalment
some time in 2010. Demand notice dated 16.03.2012,
shows that Terrace Floor Slab was completed at that
time   and   demand   notice   dated   18.06.2012   shows
that   the   builder   had   applied   for   issue   of   Occupation
Certificate,   which   has   been   issued   on   28.02.2013.
Thereafter,   final   accounts   of   the   buyers   were
prepared   and   possession   was   offered   through   letter
dated   10.06.2013.   Due   to   delay   in   starting
construction   payment   schedule   of   the   instalments
was changed and to mete out suffering of the buyers,
various   benefits   were   provided.   Delay   in   offering
possession had occurred as construction could not be
started   for   more   than   one   year   of   booking.   lf   the
buyers were required to payment instalments on later
dates   than   the   dates   fixed   in   the   agreement,   then
how   it   can   be   expected   that   the   possession   could   be
given   within   three   years   of   the   agreement.   In   the
circumstances, the  builder was  justified in not giving
compensation   for   delayed   possession   in   the
statement of account dated 10.06.2013.
21

16. However, as we found  that  the complainant was
entitled   for   "Timely   Payment   Rebate”   as   such
statement   of   the   account   dated   10.06.2013   and
demand   on   its   basis   was   illegal.   In   such
circumstances   we   direct   the   builder   to   pay   6%   p.a.
interest on the  amount  deposited  by the  complainant
toward basic sale price, as compensation for delay in
possession   from   July   2013   till   date   of   offer   of
possession as directed by Supreme Court in  Wg. Cdr.
Arifur   Rahman   Khan   Vs.   DLF   Southern   Homes
Pvt. Ltd., (2020) 16 SCC 512. ”
(quoted verbatim from paperbook)
23. We are, however, unable to accept this reasoning. So far
as start of the running time for quantifying delayed payment of
compensation  from  March  2013 is concerned, we find that  the
builder   themselves   had   modified   the   relevant   clause   by   their
letter   dated   26th   March   2009,   amending   the   starting   date   for
computing delayed payment of compensation from end of three
years from the date of Agreement to three years from the date of
booking.   Thus,   the   date   of   booking   in   the   case   of   the   allottee
being   March   2008,   the   State   Commission   had   rightly   directed
payment of delayed compensation from March 2011. 
24. Mr.   Mishra   has   urged   that   the   entire   responsibility   for
delivery of possession of the flat should not fall on his clients as
the   allottee   himself   could   have   applied   before   the   adjudicatory
forum   for   possession   thereof   subject   to   outcome   of   the   case.
22

But   this   argument   in   our   view   is   fallacious.   The   dispute
between   the   parties   primarily   arose   as   the   builder   denied
substantial   benefits   to   the   allottee   for   nine   days’   delay   in
clearing   instalment.   This   allegation   of   delay   has   been   rejected
by   the   Consumer   Fora   and   their   concurrent   finding   is   that   no
proper demand was made for payment of such instalment. Mr.
Mishra   has,   in   his   submissions,   emphasised   on   the   “offer   for
possession”  letter  dated  10 th
  June  2013  and  his  submission  is
that obligation to pay delayed payment compensation cannot go
beyond that date. The builder’s case is that they cannot be held
responsible   if   the   allottee   does   not   take   possession   of   the   flat,
when   offered.   A   copy   of   this   letter   has   been   annexed   at   page
235 of the builder’s paperbook. On a plain reading of this letter,
we   find   that   the   builder   offered   physical   possession   only   on
remitting of payments as per statement of accounts, which was
for  a sum  of  Rs.9,00,382/­ and on furnishing  an  undertaking.
The National Commission found that  the statement  of  account
dated 10 th
 June 2013 and demand on that basis was illegal. As
the offer for possession was conditional on settling of accounts
and,   as   the   accounts   reflected   illegal   demand,   the   builder
cannot  argue that there  was a  valid  offer   for   possession under
23

the   letter   dated   10 th
  June   2013.   In   this   background,   in   the
event  the allottee  wanted proper  adjudication  of his rights and
liabilities before asking for interim possession of the flat which
would have had carried with it unspecified obligations, no fault
can be found in such conduct of the allotee.
25. Reliance   has   been   placed   on   the   judgments   of   two
coordinate   Benches   of   this   Court   in   the   cases   of   DLF   Homes
Panchkula Pvt. Ltd. vs D.S. Dhanda and Ors.   [(2020) 16 SCC
318] and  DLF Home Developers Ltd. And Another vs Capital
Greens Flat Buyers Association & Ors.  [(2020] SCC Online SC
1125]   in   support   of   the   argument   of   the   builder   that   “Delay
Compensation” could be awarded only upto the date of offer of
possession.     But   in   this   case,   we   have   already   held   that   there
was   no   valid   offer   for   possession.     In   the   case   reported   in
[(2020) 16 SCC 318], interest was directed to be paid by way of
compensation   on   deposited   amount   from   the   promised   date   of
possession   to   the   actual   date   of   handing   over   possession,   and
the coordinate Bench directed, inter­alia, payment of interest at
the rate of 9% per annum for a period of two months from the
date of offer for possession.  In the case of  Capital Greens Flat
24

Buyers   Association   (supra),   interest   was   awarded   as
compensation   for   delay   in   delivery   of   possession.     The   latter
judgment   was   delivered   in   the   special   circumstances   of   that
case.     We   accept   the   argument   advanced   on   behalf   of   the
builder   that   time   for   payment   of   compensation   for   delayed
payment   shall   stop   running   from   the   date   of   offer   for
possession.     But   in   this   case,   there   was   no   valid   offer   for
possession.    Mr.  Mishra  also   sought   to   bring   to   our   notice  the
proposals   made   in   course   of   mediation   proceeding.     But
mediation   obviously   failed   between   the   parties   and   we   cannot
refer   to   what  transpired   during   the   process   of   mediation   while
adjudicating the right of the parties in an appeal. 
26. The   ratio   of   the   judgment   in   the   case   of   Wing
Commander   Arifur   Rahman   Khan   and   Aleya   Sultana   and
Others vs DLF Southern Homes Pvt. Ltd. and Others  [(2020)
16 SCC 512] does not apply in the facts of the present case. The
aforesaid   decision   was   rendered   in   a   context   in   which   a
coordinate Bench of this Court found the Agreement involved in
that   case   was   lopsided,   giving   unjustified   advantage   to   the
25

builder.   The   relevant   paragraph   from   the   judgment   is
reproduced below:­
“25.   The   only   issue   which   then   falls   for
determination   is   whether   the   flat   buyers   in   these
circumstances   are   constrained   by   the   stipulation
contained   in   Clause   14   of   ABA   providing
compensation   for   delay   @   Rs   5   per   square   feet   per
month. In assessing the legal position, it is necessary
to   record   that   the   ABA   is   clearly   one­sided.   Where   a
flat   purchaser   pays   the   instalments   that   are   due   in
terms   of   the   agreement   with   a   delay,   Clause   39(a)
stipulates that the developer would “at its sole option
and   discretion”   waive   a   breach   by   the   allottee   of
failing   to   make   payments   in   accordance   with   the
schedule,   subject   to   the   condition   that   the   allottee
would   be   charged   interest   @   15   per   cent   per   month
for   the   first   ninety   days   and   thereafter   at   an
additional penal interest of 3% p.a. In other words, a
delay on the part of the flat buyer attracts interest @
18%   p.a.   beyond   ninety   days.   On   the   other   hand,
where a developer delays in handing over possession
the flat buyer is restricted to receiving interest at Rs 5
per square feet per month under Clause 14 (which in
the submission of Mr Prashant Bhushan works out to
1­1.5%   interest   p.a.).   Would   the   condition   which   has
been prescribed in Clause 14 continue to bind the flat
purchaser indefinitely irrespective of the length of the
delay? The agreement stipulates thirty­six months as
the   date   for   the   handing   over   of   possession.
Evidently,   the   terms   of   the   agreement   have   been
drafted   by   the   developer.   They   do   not   maintain   a
level   platform   as   between   the   developer   and
purchaser. The stringency of the terms which bind the
purchaser   are   not   mirrored   by   the   obligations   for
meeting   timelines   by   the   developer.   The   agreement
does not reflect an even bargain.”
27. So   far   as   the   present   appeals   are   concerned,   the
quantum   of   delayed   compensation   has   been   enhanced   by   the
26

builder themselves, along with provision for enhancement with
respect to the delay in payment if made by the allottee in taking
possession.   In   such   circumstances,   we   do   not   think   the
National   Commission   ought   to   have   had   deviated   from   the
modified   contractual   terms   contained   in   the   communication
dated   26 th
  March   2009   and   replace   the   said   terms   with   6%
interest per annum from July 2013 till the date of fresh offer of
possession was made. In our opinion, on the point of payment
of delayed compensation, the State Commission’s view was the
right view. 
28. Now comes the question as to which date shall be treated
to  be  the  date  for  fresh  offer  of  possession.  Both   the  fora  have
directed the builder to issue fresh offer of possession as per the
dates   specified   in   the   order.     The   directions   of   the   State   and
National   Commissions   were   not   to   operate   with   retrospective
effect, from 10 th
 June 2013. The argument of the builder is that
a   possession   offer   letter   was   issued   on   that   date.   This   letter
showed   certain   sum   of   balance   and   also   included   certain
demands on account of cost of increase in apartment size area,
further   EDC   and   IDC   charges,   stamp   duty   charges,   etc.   Some
27

rebates   were   also  denied   to  the   allottee   on   account   of   delay   in
payment  of instalment  by  nine  days,  which  we have  discussed
in the preceding paragraphs of this judgment. In an application
dated 15 th
 November 2018, which was filed on 7 th
 January 2019
before the State Commission, the builder admitted their fault in
not   providing   any   compensation   for   delayed   payment   in   the
aforesaid   letter   of   10 th
  June   2013   and   prayed   that   the
complainant (i.e., the allottee) be directed to pay excess amount
as   specified   in   the   said   application   and   take   possession   of   the
apartment.   The   State   Commission   found   that,   as   per   the   said
application,   the   builders   had   admitted   wrong   calculation   in
settling   the   credits   in   the   account   of   the   allottee.   In   fact,   the
builders   then   had   given   the   credit   for   a   sum   of   Rs.2,40,210/­
and   issued   a   cheque   for   the   said   sum,   which   the   allottee   did
not   encash.   Such   conduct   on   the   part   of   the   allottee   was
justified   as   the   dispute   was   still   pending   before   the   State
Commission. The State Commission found deficiency of service
on   the   part   of   the   builder   by   sending   wrong   statement   of
accounts   along   with   the   letter   of   possession   and   as   per   the
finding   of   the   State   Commission,   the   allottee   was   deprived   in
taking   possession   of   the   flat,   which   was   offered,   because   of
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these factors. The National Commission did not take a contrary
view and in fact came to a finding that the statement of account
dated   10 th
  June   2013   and   demand   on   that   basis   was   illegal.
These   findings   arrived   by   the   two   fora   were   on   appreciation   of
evidence and we do not find any perversity in such finding. So,
the   letter   of   10 th
  June   2013   cannot   be   treated   as   a   valid   offer
letter.
29. (i)   We,   accordingly,   hold   the   finding   of   the   National
Commission as also the State Commission that the allottee
would   be   required   to   pay   maintenance   charges   as
erroneous   and   that   part   of   the   findings   of   the   two
Commissions are set aside.  
(ii)   The   entity   to   whom   such   charge   is   due   has   not   raised
any   claim.   In  such  circumstances,   direction   to   the   allottee
to   pay   maintenance   charges   was   not   warranted   as   the
entity   entitled   to   receive   such   charges   is   not   a   party   to
these proceedings. Such directions assume the character of
declaration   of   liability   or   obligation   of   the   allottee   in
absence of the admitted claimant, who had not brought any
action   or   staked   their   claim   in   any   other   manner   through
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these   proceedings.   Such   declaratory   relief   cannot   be   given
in vacuum. 
(iii)   We   sustain   the   order   of   the   National   Commission   as
also   the   State   Commission   that   fresh   offer   of   possession
ought   to   be   issued.   We   extend   the   time   for   issuing   such
offer   of   possession   by   a   period   of   eight   weeks   from   this
date.   Execution   of   Deed   shall   be   effected   within   the
aforesaid period.
(iv) We modify the direction of National Commission relating
to   payment   of   delayed   compensation   and   while   restoring
the   directions   of   the   State   Commission,   we   direct   that
delayed   compensation   be   paid   at   the   rate   of   Rs.10   per
square   feet   per   month   for   the   entire   period   from   March
2011 till  the date on which the fresh  offer  of possession is
issued. 
(v)   The   delayed   possession   compensation   shall   be   paid   to
the   allottee   after   adjusting   the   delayed   compensation
already paid. The early payment rebate of Rs.95,136/­ shall
also   be   adjusted,   as   has   been   directed   by   the   National
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Commission. The said sum was mentioned in the statement
of account dated 10 th
 June 2013. 
(vi) We retain the order as to costs to be paid to the allottee
quantified by the National Commission as Rs.50,000/­. 
30. Both the appeals are disposed of in the above terms. We,
however,   make   it   clear   that   in   this   judgment,   we   have
addressed   only   the   two   questions   on   which   leave   is   granted.
Rest   of   the   findings   or   directions   of   the   National   Commission
shall remain undisturbed. 
31. Connected   applications,   if   any,   shall   stand   disposed   of,
without any order as to costs. 
………………………………., J.
(DINESH MAHESHWARI)
………………………………., J.
(ANIRUDDHA BOSE)
NEW DELHI;
11 th
 JULY 2022
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