Legal Question in Construction Law in India

On and off media and legal advisors forewarn investors in real estates to make sure that an approved layout/building plan had been obtained by builders who float buildings/flats for sale. An investor gave power of attorney to a builder to do all that is necessary to bring up a cottage in a land that was registered in his name and paid the construction cost. The investor when he got the completed cottage applied for electrical connection only to shock to realize the builder had not got clearance from local authorities to get the site converted to a building one nor got the approval for construction. The builder said it is for the investor to get the requisites. As per local authorities the cottage was an unauthorized construction and can be demolished or sealed. The investor managed to get covering approvals by paying premium money.

Can the investor sue the builder for punitive damages for three years period as he could neither occupy nor rent the cottage?


Asked on 10/30/09, 5:26 am

1 Answer from Attorneys
Seshadri Srinivasan www.lawconcern.com

This is not a typical flat promotion transaction.

A pure construction agreement under power of attorney to construct the cottage on a land owned by the customer. However, if the terms of construction and power of attorney provide that the contractor obtain prior- approval of authorities, then certainly a consumer case for the actual loss, mental agony etc can be claimed.

Issue a lawyer notice and then file the case.

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Answered on 10/30/09, 5:35 am


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