Legal Review and Analysis of Rajnesh Sharma vs Ms Business Park Town Planners Ltd 2025 INSC 1149

1. Name of the Judgment

Rajnesh Sharma vs. M/s. Business Park Town Planners Ltd.
Civil Appeal No. 3988 of 2023
Decided on: September 24, 2025
Judges: Justice Dipankar Datta and Justice Augustine George Masih

Citation:
Rajnesh Sharma v. M/s. Business Park Town Planners Ltd., (2025) INSC 1149, Civil Appeal No. 3988 of 2023 (Supreme Court of India).

2. Relevant Laws and Sections

• Consumer Protection Act, 1986 – Section 14(1)(d)

• Indian Contract Act, 1872 – Principles of equity and reasonableness in contractual terms

• Precedents Referenced:
  Ghaziabad Development Authority v. Balbir Singh (2004)
  Fortune Infrastructure v. Trevor D’Lima (2018)
  IREO Grace Realtech v. Abhishek Khanna (2021)
  Vidya v. Parsvnath Developers Ltd. (2024)
  Kolkata West International City Pvt. Ltd. v. Devasis Rudra (2020)
  Pioneer Urban Land v. Govindan Raghavan (2019)

3. Basic Details of the Case

• Appellant: Rajnesh Sharma (Home Buyer)

• Respondent: M/s. Business Park Town Planners Ltd. (Builder/Developer)

• Nature of Dispute: Delay in handing over possession of a booked plot and unfair contractual terms.

• Forum: Appeal against the order of the National Consumer Disputes Redressal Commission (NCDRC) dated January 13, 2023.

• NCDRC Order: Directed refund of principal amount with simple interest @9% p.a.

• Supreme Court’s Decision: Enhanced interest rate to 18% p.a. on the refund amount.

4. Core Principle of the Judgment

Issue Before the Supreme Court

Whether the NCDRC erred in awarding delay compensation at only 9% per annum simple interest, despite the builder’s own practice of charging 18% interest on delayed payments by the buyer, and considering the inordinate delay and unfair conduct of the builder.

Background and Contractual Terms

The appellant booked a plot in 2006 under a buyer agreement. The builder failed to deliver possession within the stipulated 24 months. In 2011, the builder unilaterally allotted an alternative plot citing layout changes and demanded extra charges. Possession was eventually offered only in 2018, after the buyer filed a consumer complaint. The builder also charged interest at 18% on delayed payments by the buyer.

Analysis by the Supreme Court

• One-Sided Agreement: The Court noted that the builder-buyer agreement was heavily skewed in favour of the builder. While the buyer was charged 18% interest for delays, the builder’s liability for delay was minimal.

• No Absolute Rule Against Parity: The Court rejected the respondent’s argument that buyers cannot claim parity with builders in interest rates. It held that each case must be decided on its own facts and equity.

• Conduct of the Builder: The Court highlighted the builder’s unjustified delays, unilateral changes, and imposition of unauthorized charges (e.g., GST, enhanced EDC, PLC) as conduct that aggravated the buyer’s hardship.

• Equity and Fairness: The Court emphasized that equity demands that a builder who imposes a high interest rate on the buyer should be held to the same standard when in default.

Supreme Court’s Reasoning

The Court held that the NCDRC’s award of 9% interest was inadequate and failed to serve the ends of justice. It observed that the builder’s conduct was “full of blemishes” and caused the buyer “harassment and anxiety.” The Court applied the principle of fairness to ensure that the builder did not benefit from its own one-sided terms.

5. Final Outcome

The Supreme Court partly allowed the appeal and modified the NCDRC’s order as follows:

• The rate of interest payable by the builder to the buyer was increased from 9% to 18% per annum simple interest on the principal amount.

• The refund was to be made within two months from the date of the judgment.

• No additional costs were awarded.

6. MCQs Based on the Judgment

Q1. In Rajnesh Sharma v. M/s. Business Park Town Planners Ltd., what was the primary legal basis for the Supreme Court to enhance the interest rate from 9% to 18%?

A. Statutory mandate under the Consumer Protection Act
B. Precedent from Ghaziabad Development Authority v. Balbir Singh
C. Principle of equity and fairness due to one-sided contractual terms
D. Buyer’s explicit demand for parity with the builder’s interest rate

Correct Answer: C
Explanation: The Supreme Court emphasized equity and fairness, noting that the builder charged 18% interest on the buyer’s delay but sought to pay only 9% for its own default.

Q2. Which of the following was NOT a factor considered by the Supreme Court in enhancing the interest rate?

A. Delay in possession of over a decade
B. Unilateral alteration of the plot by the builder
C. Buyer’s failure to prove actual loss
D. Imposition of unauthorized charges like GST and enhanced EDC

Correct Answer: C
Explanation: The Court held that while proof of actual loss is generally required, in this case, the focus was on the reasonableness of the interest rate based on the builder’s conduct and the one-sided agreement.