Now, home buyers hit the streets against builders over non-delivery

Last Updated: Sun, Sep 08, 2013 03:52 hrs

On Saturday, some 350 members of a Gurgaon home owners' association were seen braving the autumn sun at New Delhi's Jantar Mantar.

The venue has become a protest hotspot since 2011, when Anna Hazare began his agitation against the system, giving activism a new coinage. But Saturday's unrest was of a different nature. The protest was against a leading developer, DLF, for not delivering apartments on time and its alleged refusal to pay a compensation to frustrated buyers.

This is not a solitary case. Most big developers across the country are experiencing customer activism. And, the trend is only likely to pick up in a big way, say analysts tracking the sector, which has been in the middle of a slowdown due to a drop in demand. In fact, another protest by a group of home buyers - against Unitech, a prominent builder - is ready to hit the streets on Sunday itself.

With an end to the '80-20' subvention scheme Reserve Bank of India (RBI) Governor Raghuram Rajan might have indicated RBI's lack of confidence in builders, says Sanjay Sharma, managing director of Qubrex, a real estate consulting firm. This could encourage more buyers to come out in the open and speak against developers, Sharma says. With investors finding it hard to exit a market which has seen prices stagnating, consumer activism will increase even more, he adds.

Nitin Grover, president, New Town Heights Home Owners Association, Gurgaon, told Business Standard that he and other members, who had gathered at Jantar Mantar on Saturday and then moved to DLF's corporate headquarters, just a small walk away, to shout slogans, would continue to agitate till they were treated fairly. Most of them professionals, the protesters included many from as far as Dubai, Bangalore and Mumbai.

They had bought flats - from 1,900 sq ft to 3300 sq ft ones - at New Town Heights by paying between Rs 50 lakh and Rs 1 crore about four years ago. But most of them have yet to get possession. The project for 3,400 flats was launched in 2009, with a promised delivery in 2011. Recently, 80 flats were given out for possession but construction has yet to be completed, according to Manish Kamra, a buyer.

"We will come back to protest at Jantar Mantar. We were here two months ago also, but we didn't get any commitment from the builder." The case is already with the Competition Commission of India (CCI), which had earlier imposed a fine of Rs 650 crore on DLF for a different housing project - Bellaire - but the company secured a stay on the matter subsequently. Advocate M L Lahoty, who was a key lawyer for the Bellaire buyers, is advising the New Town Heights association, too.

Responding to a query on the protest, a DLF spokesperson said: "We have started the process of giving possession of housing units at New Town Heights project according to our commitment to the customers." He added the company had so far received payments from 948 of the 2,607 allottees and issued 871 possession letters. "The rest of the possession letters are under process and will be issued as customers complete payments and paperwork." He also said: "As a responsible developer, we have addressed most of the concerns of our valuable customers."

Meanwhile, the buyers' association of Unitech Uniworld Gardens, which is planning a march at MG Road (Gurgaon) on Sunday, is also working out the modalities of a protest at the company's upcoming annual general meeting on September 26. That protest will be over delay in delivery of flats across four projects, says Shailendra Bais, a member of the association. This is a project with 16 towers and 896 apartments, sold for up to Rs 3,000 a sq ft.

A Unitech spokesperson says: "We have submitted to the state town planner and other relevant authorities that we will start delivery of Uniworld Gardens from the first quarter of 2014." He adds the deliveries will be dependent on the clearance of encroachment on adjoining HUDA land which will provide approach road to the Uniworld Garden Society. The spokesperson also points out that Unitech is following up with the relevant authorities to clear the encroachment.

Analysts observe that a common pool of lawyers is helping consumers facing significant delays in delivery of houses and are now in a mood to agitate against unfair practices. Grover, who admits the Hazare movement has had its rub-off effect, argues: "Lawyers may be helping us in the court, but consumers are protesting because of their frustration. They realise they need to be on the street, otherwise the abuse will only increase."

Besides DLF, developers taken to CCI by agitating home owners in the past two years include Hiranandani Infrastructure & Real Estate Company, Raheja Developers, Omaxe Group, Kolkata West International City, Exact Developers and Today Home.

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