Authority: Supreme Court of India, Civil Appellate Jurisdiction

Order Date: 15 October 2026

Case Overview

  • Parties: Appellant Madhu Kudapa (formerly K. Madhusudhan Rao) vs. Respondents Lodha Healthy Constructions and Developer Private Limited (builder) and Housing Development Finance Corporation Limited (bank).
  • Background: In 2009 the borrower booked an apartment in “Lodha Bellezza” (Kukatpally, Hyderabad) for Rs 2,30,73,876. He paid Rs 51,11,576 (22% of consideration) from his own funds and secured a Rs 2 crore housing loan from HDFC Ltd. The bank disbursed Rs 1,68,80,531 in 13 tranches (≈95% of total consideration) between Feb 2010 and July 2011.
  • Delay: Builder promised possession by April 2012 but failed to deliver. Occupancy and fire NOCs were pending until May 2013. The borrower filed a consumer complaint (CC No. 150 of 2013) on 13 May 2013 seeking refund of Rs 2,19,92,107 with interest, rent reimbursement, and compensation.
  • Commission Orders: NCDRC (01‑07‑2022) directed full refund with 9% interest, later modified to 12% interest and a Rs 2 lakh penalty on the bank. Builder deposited Rs 4,43,24,510 (later accruing to Rs 5,65,43,411 as of 08‑10‑2026). Bank’s review petition dismissed (07‑12‑2022). Subsequent appeals pending before High Court.
  • Submissions: Borrower argued for 18% interest, full refund including bank‑disbursed amount, rent compensation, and mental‑agony damages. Builder accepted the commission order and proposed partial settlement. Bank contended the commission erred in ordering full refund, citing tripartite agreement clauses.
  • Issues: (a) Extent of refund and applicable interest; (b) entitlement to compensation/rent; (c) bank’s deficiency in service; (d) relief to bank.

Final Outcome

  • The Court holds the borrower entitled to refund of Rs 1,27,34,726 (the amount he actually paid from his own pocket) with simple interest at 12% per annum from the date of each payment until settlement.
  • Compensation: The Court awards Rs 15,00,000 as full and final settlement for rent loss, mental agony, harassment, and litigation expenses.
  • Bank Penalty: The finding of deficiency against the bank is upheld; the bank must pay Rs 2,00,000 to the borrower.
  • Name Change: The application to amend the appellant’s name is allowed; the appellant may be styled “Madhu Kudapa”.
  • Remaining Funds: The balance of the amount deposited by the builder (after the above deductions) shall be kept in an interest‑bearing account pending the outcome of the bank’s appeal before the High Court.
  • Further Directions: The High Court shall decide the bank’s pending appeal without being influenced by this judgment; no costs awarded; all pending applications are disposed of.

Topics: Consumer Protection, Real Estate Refund