Parsvnath Developers Ltd. v. Mohit Khirbat 2026 INSC 170 - Consumer Protection - Flat Purchase - Delay In Handing Over Possession
"Failure to obtain the requisite Occupancy Certificate constitutes deficiency in service, entitling consumers to seek compensation.."
Consumer Protection Act 1986 - Section 2(1) - Housing construction falls within the ambit of “service” under Section 2(1)(o) and failure to deliver possession within the stipulated period constitutes “deficiency” under Section 2(1)(g) . (Para 11) Flat purchasers are “consumers” and delay in handing over possession amounts to deficiency in service. (Para 12) Where possession is not delivered within the stipulated or reasonable time without justifiable cause, the allottee is entitled to refund with reasonable interest and in appropriate cases, additional compensation depending upon the facts. Compensation is not uniform and must be moulded in light of the nature of delay, conduct of the authority, and extent of harassment suffered. (Para 19) Detailed mathematical ascertainment of market decline is not a sine qua non; what is required is that the award be just, reasonable and proportionate to the delay, deprivation and hardship established on record. (Para 21) A subsequent purchaser is entitled to seek the same relief as the original allottee and cannot be denied compensation merely on the ground that he or she stepped into the shoes of the original allottee at a later stage. (Para 18)
Consumer Protection Act 1986 - Failure to obtain the requisite Occupancy Certificate constitutes deficiency in service, entitling consumers to seek compensation- Obtaining such certificate is a statutory pre-condition integral to lawful delivery of possession. A purchaser cannot be compelled to accept possession without completion and statutory certificates, and such an offer is legally untenable. (Para 25-26)
Consumer Protection Act 1986 - Section 14- In this case, NCDRC awarded rebate, litigation expenses and additional stamp duty charges to be borne by the appellant on account of the delay in handing over the possession - SC held: Such directions are incidental and ancillary to the main relief of compensation and fall squarely within the ambit of Section 14 of the Act. (Para 28.1)
Consumer Protection Act 1986 - Section 2(1) -The power of the consumer fora to grant just and reasonable compensation for deficiency in service is traceable to the statute and cannot be curtailed by contractual terms which operate to the detriment of the consumer (Para 18) Contractual stipulations cannot curtail the statutory jurisdiction of the consumer fora - One-sided and unreasonable clauses in builder-buyer agreements constitute an unfair trade practice under Section 2(1)(r) - Incorporation of such oppressive terms in a standard form contract, where purchasers have little or no bargaining power, cannot bind the consumer so as to defeat statutory remedies under the Act.The provisions of the Act must receive a liberal construction in favour of the consumer, the legislation being beneficial in character. The expression “compensation” extends not only to pecuniary loss but also to mental agony and harassment occasioned by deficiency in service. (Para 11-13) The statute does not impose any embargo on the grant of higher or reasonable compensation merely because the parties have agreed to a particular clause, especially where such clause is found to be unfair or oppressive. While consumer fora must act judicially and not arbitrarily enhance compensation, they are not bound to mechanically enforce a contractual term that results in manifest injustice. Departure from such a clause, where justified by the nature and duration of the delay and the hardship caused, lies within the statutory competence of the forum. (Para 16)
Case Info
Case Name and Neutral Citation
Parsvnath Developers Ltd. v. Mohit KhirbatParsvnath Developers Ltd. v. Gp. Capt. Suman Chopra (Dead) through LRsParsvnath Hessa Developers Pvt. Ltd. v. Aman Chawla and Another
Neutral citation: 2026 INSC 170
Coram
Bench: Justice B.V. Nagarathna and Justice R. Mahadevan(Author of judgment: R. Mahadevan, J.)
Judgment Date
20 February 2026 (as stated at the end of the judgment)
Caselaws and Citations Referred
- Lucknow Development Authority v. M.K. Gupta, (1994) 1 SCC 243
- M/s Imperia Structures Ltd. v. Anil Patni & Anr, Civil Appeal Nos. 3581–3590 of 2020, decided on 02.11.2020
- IREO Grace Realtech Pvt. Ltd. v. Abhishek Khanna & Ors, (2021) 3 SCC 241
- Pioneer Urban Land & Infrastructure Ltd. v. Govindan Raghavan, (2019) 5 SCC 725 : (2019) 3 SCC (Civ) 37
- ESI Corporation v. High Land Coffee Works, (1991) 3 SCC 617
- CIT v. Taj Mahal Hotel, (1971) 3 SCC 550
- State of Bombay v. Hospital Mazdoor Sabha, AIR 1960 SC 610 : (1960) 2 SCR 866
- Arifur Rahman Khan v. DLF Southern Homes (P) Ltd., (2020) 16 SCC 512
- Bangalore Development Authority v. Syndicate Bank, (2007) 6 SCC 711
- Ghaziabad Development Authority v. Balbir Singh, (2004) 5 SCC 65
- Chief Administrator, HUDA & Anr v. Shakuntla Devi, (2017) 2 SCC 301
- DLF Homes Panchkula Pvt. Ltd. v. D.S. Dhanda etc. etc., AIR 2019 SC 3218
- Laureate Buildwell Pvt. Ltd. v. Charanjeet Singh, (2021) 20 SCC 401
- Samruddhi Cooperative Housing Society Ltd. v. Mumbai Mahalaxmi Construction (P) Ltd., (2022) 4 SCC 103
- Dharmendra Sharma v. Agra Development Authority, 2024 INSC 667
- Debashis Sinha v. R.N.R. Enterprise, (2023) 3 SCC 195 : (2023) 1 SCC (Civ) 356
(Plus internal references back to earlier SC orders in:– Civil Appeal No. 473 of 2020, Parsvnath Developers Ltd. v. Mallika Raghavan (disposed of 22.04.2024)– Civil Appeal No. 951 of 2020 (by respondents in C.A. No. 11047/2025, dismissed 11.03.2024))
Statutes / Laws Referred
- Consumer Protection Act, 1986– Section 2(1)(c) – Complaint– Section 2(1)(g) – Deficiency– Section 2(1)(o) – Service (including housing construction)– Section 2(1)(r) – Unfair trade practice– Sections 12, 13, 14 – Powers and procedure for consumer fora– Section 22 – Power and procedure applicable to National Commission
- Consumer Protection Act, 2019– Concept of “unfair contract” (mentioned as subsequent statutory recognition)
- U.P. Apartment (Promotion of Construction, Ownership and Maintenance) Act, 2010– Section 4(5) (referred via Dharmendra Sharma v. ADA on requirement of completion/clearance certificates)
- Real Estate (Regulation and Development) Act, 2016 (RERA)– Section 19(10) (requirement of completion/occupancy etc. before offering possession, again via Dharmendra Sharma)
- Contract law principles and standard-form / one-sided contracts (discussed through case law rather than specific sections of the Contract Act).
Three‑Sentence Brief Summary
The Supreme Court upheld the National Consumer Disputes Redressal Commission’s directions requiring the builder to complete construction, obtain the Occupancy Certificate, hand over possession, and pay 8% p.a. interest as compensation for delay to the flat purchasers in Parsvnath Exotica, Gurgaon. It held that the consumer fora’s power to award just and reasonable compensation under the Consumer Protection Act is statutory and cannot be curtailed by one‑sided contractual clauses like Clause 10(c), and that offering possession without an Occupancy Certificate amounts to deficiency in service. Finding prolonged delay, repeated non‑compliance with earlier court directions, and significant hardship to homebuyers, the Court affirmed the NCDRC’s orders in full, directing continued payment of interest and ancillary reliefs (rebate, litigation costs, and additional stamp duty burden on the builder), with specific directions for each set of allottees.
