Flat owners in Maradu not entitled to any interest on amounts paid by them

A bench of Justices L Nageswara Rao and B R Gavai said in the present case, the flat-owners have purchased their apartments by paying installments somewhere between 2007 and 2013 depending on the construction of the particular building complex.

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The Supreme Court on Friday said the owners of flats, which were demolished for violation of Coastal Regulation Zone (CRZ) norms in Kochi’s Maradu are not entitled to any interest on the amounts paid by them to the builders.

A bench of Justices L Nageswara Rao and B R Gavai said in the present case, the flat-owners have purchased their apartments by paying installments somewhere between 2007 and 2013 depending on the construction of the particular building complex.

“Possession of the flats was handed over to the flat-owners between 2009-2013 and admittedly, the flat-owners were in possession of the flats from 2009-2013 till 2019 when they were asked to vacate the flats for the demolition of the buildings.

“There is no dispute that the amount of Rs.25 lakhs has been paid as interim compensation by the State Government in 2019 itself,” the bench said.

The apex court also noted that except Holy Faith builder, the other builders have also paid the balance amount to which the flat-owners were entitled.

The top court said it is no doubt true that the flat-owners were paid only the amount that was invested by them at the time of purchase of flats.

“However, it is relevant to take into account the fact that the flat- owners had the benefit of staying in the flats for a period of 8-9 years on an average and also that the land belongs to the flat-owners as joint owners the market value of which has increased substantially.

“It is also to be noted that flats that were taken possession of in the years between 2009-2013 would have depreciated in value. Therefore, in view of the position as stated above, we are of the considered view that the flat-owners are not entitled to any interest on the amounts paid by them to the builders,” the bench said.

The apex court had earlier appointed former Calcutta High Court judge Justice Thottathil B Nair Radhakrishnan to enquire and submit a report on the involvement of persons responsible for the illegal construction of the buildings in violation of Coastal Regulation Zone (CRZ) norms in Maradu, Kochi.

The apex court had earlier in 2019 directed the demolition of flats built on the coastal zone of Kochi’s Maradu within 138 days and asked the state to pay Rs 25 lakh interim compensation to each flat owner within four weeks.