Chandigarh Housing Borad, MC fined for failing to convert residential property to freehold

Setting aside a district commission’s order, the State Consumer Disputes Redressal Commission has penalised the Chandigarh Housing Board (CHB) and municipal corporation (MC), and directed them to take up a city resident’s case of conversion of his house from leasehold to freehold and also execution of conveyance deed within three months.

Complainant Ashok Bembey of Manimajra has been waiting for this execution since 2008. Advocate Karan Dev Sharma said, in 2002, Bembey bought a house in MHC, Manimajra, from a woman (original allottee), who had bought it under the quota for persons of Indian origin residing/settled abroad exclusively. All formalities were done and power of attorney was also given by her.

In June 2008, Bembey applied for the transfer of the house with the CHB and MC and paid the transfer fees of ₹1,97,740 in cash to the housing body in February 2015. The house was ultimately transferred in June 2015 after a delay of about seven years.

Bembey’s counsel said instead of getting the conveyance deed executed in his favour, CHB, in June 2020, raised the demand for ground rent under a leasehold basis along with GST totaling ₹82,269, and that too, when admittedly they were already having an excess amount in the account of property in question.

Alleging that the conversion of the unit in question from leasehold to freehold could not be done due to the fault of the housing board, the elderly man moved the consumer commission against the CHB chairman and MC commissioner.

In March 2023, the district commission dismissed the plea by holding that the complainant did not fall within the purview of the consumer in view of the ratio of law laid down by the Supreme Court of India.

However, coming to the relief of the elderly complainant, the State Consumer Disputes Redressal Commission dismissed the district commission’s order stating that it fell into an error in dismissing the consumer complaint.

The state commission directed the CHB and MC to “take up the complainant’s case qua conversion of his unit in question from leasehold to freehold and also execution of conveyance deed, after completing due formalities and get the same done within a period of three months from the date of receipt of a certified copy of this order, without charging anything from the complainant.

Failing which, they shall be liable to pay a penalty ₹500 per day to the complainant till realisation.

It directed the CHB to refund ₹32,169 to Bembey and ground rent if received. The amount shall be refunded along with interest @9% p.a. from the date of its receipt onwards within a period of 30 days from the date of receipt of the order.

Also, they will jointly and severally pay ₹5 lakh as compensation to the complainant for causing him mental agony, humiliation and harassment, as for deficiency in rendering service and negligence, and ₹50,000 as cost of litigation.