On Thursday, 10 February, a portion of the sixth floor of a building in Gurugram’s Chintels Paradiso society collapsed. Two people died and several homes were damaged.
The police have since filed two FIRs: one against against the chairman of Chintels, Ashok Solomon; and the other against the builder, Chintels India Private Ltd, as well as a contractor and five other parties engaged in the group housing project.
The first FIR (against the chairman) has been registered under Section 304A of the Indian Penal Code, which deals with death by negligence.
Meanwhile, the second FIR focuses on claims of fraud against the builder, registered under IPC offences like Sections 420 (dishonestly inducing delivery of property), 468 (forgery for purpose of cheating) and 120B (criminal conspiracy), as well as the Haryana Development and Regulation of Urban Areas Act, 1975.
Meanwhile, residents of the society whose homes were affected have been temporarily moved to different flats in the society's sister-projects. They have also told The Quint that they are seeking monetary compensation or permanent relocation to safer apartments of similar value.
But what are the remedies that the law offers in cases like this? And how can one seek them? The Quint reached out to legal experts to find out.
Contractual Liability
“A typical construction contract always has a defect liability clause,” Harshit Anand, a real-estate lawyer, told The Quint. “After handover of the building, if the buyer finds any kind of defect in the building, it will amount to a defect liability. Thus, if a building collapses the first liability we have to look at is a defect liability.”
This has been codified under Section 14(3) of the Real Estate (Regulation and Development) Act, 2016 (RERA Act), and forms a part of the contract. It says:
"In case any structural defect or any other defect in workmanship, quality or provision of services or any other obligations of the promoter as per the agreement for sale relating to such development is brought to the notice of the promoter within a period of five years by the allottee from the date of handing over possession, it shall be the duty of the promoter to rectify such defects without further charge, within thirty days, and in the event of promoter's failure to rectify such defects within such time, the aggrieved allottees shall be entitled to receive appropriate compensation in the manner as provided under this Act."
The promoter of the building project (Here, Chintels) bears this liability as it is a pure breach of agreement between them and the buyer of a flat. To pursue this remedy, an aggrieved party can approach the Real Estate Regulation Authority of their particular state.
According to Delhi-based advocate Pranav Proothi, the RERA Act also empowers the RERA authority to conduct suo-moto investigations or to call up any promoter at any time to furnish written explanations.
“The RERA Authority also has the power to revoke the registration of a promotor if the Authority finds that the promotor has defaulted in doing anything provided under the Act,” Proothi noted.
If the building in question has not been registered under the RERA Act, Anand told The Quint that an aggrieved party can use the Consumer Protection Act to go to a state consumer forum and file a case there for deficiency of services.
They can also go to a civil court and file a basic civil suit for breach of contract claiming compensation, though this will of course mean getting stuck in the vortex of delays that plague the court system.
Tortious Liability
Another way to claim compensation in a situation like this is to file a tortious claim. When you hear about someone being sued in a legal TV show, this is what they are normally talking about there. Tortious liability comes from English common law, which continues to be followed in India.
In the case of a building collapse, the obvious target is the builder/developer, but it is also possible to file a tort against the local municipal corporation which gave its sign-off for the project.
Depending on the situation, either or even both could be sued for negligence, ie failing to take the required care when building and/or approving the project.
If the reason for the building collapse emerges as negligence on the part of the developer (for instance if they used substandard materials) then they will be liable for compensation. Likewise, if the blame lies with the municipal corporation (for example if they failed to carry out regular tests) it will be them who may be asked to pay compensation.
“Tortious liability can run parallel with the contractual liability which is also why it is called concurrent liability. The two liabilities are civil liabilities originating from different sources,” Anand further explained.
While contractual liability emerges from the agreement that has been entered into, tortious liability relates to the harm caused – and so can even be claimed by someone who doesn't have a direct contract with the builder, like someone who took one of the collapsed apartments on rent.
To make a tort claim, again, the aggrieved person would have to approach the civil court which has jurisdiction over the area.
Other Legal Avenues
Incidents like these building collapses can often involve serious acts of fraud, and given the serious consequences including loss of life, can therefore become the subject of criminal cases. As already mentioned, in the Chintels Paradiso case, two FIRs have already been filed.
“Apart from the remedy available under the RERA Act, the residents in such cases also have the option to have a thorough investigation conducted by the investigative agencies. Depending on the facts and circumstances of the case, the individuals responsible may be tried for cheating (Section 417 and 420), forgery (Section 465), criminal conspiracy (Section 120-B) and causing death by negligence (Section 304 A).”Advocate Pranav Proothy
The focus in a criminal case is not really about compensation and more about affixing liability, said Yasharth Kant Srivastava, an advocate on record at the Supreme Court, noting, however, that Section 357 of the Code of Criminal Procedure does allow a criminal court to order compensation to be paid to victims of crimes in certain cases.
While the police have registered FIRs in the Chintels case, residents of the society have argued that the police are going soft on the perpetrators by not registering a murder case, and, according to The Hindu, have demanded a CBI inquiry.
In terms of monetary compensation, other possible avenues for the victims in cases like this are state government compensation. Often in the wake of disasters like this, the state government will order ex gratia payments to be made to the victims.
Alternatively, the victims can approach the relevant high court with a writ petition alleging responsibility of the state government and local authorities which gave their approval for the project, and request the court to direct compensation to be paid to them. While this can be an effective way to get compensation, of course, this is not a remedy prescribed under the law per se, like those described earlier.
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