Samaresh Prasad Chowdhury, Presiding Member
The instant appeal under Section 15 of the Consumer Protection Act, 1986 (hereinafter referred to as ‘the Act’) is at the instance of Opposite Parties to impeach the final order/ Judgment being order No. 44 dated 15th May, 2017 passed by the District Consumer Disputes Redressal Forum, Kolkata, Unit-I (in short, ‘Ld. District Forum’) in Consumer complaint No. 299 of 2010. By the impugned order, the Ld. District Forum allowed the complaint lodged by the respondent Nos. 1 and 2/complainants. The operative part of the order reproduces below:
That the CC No. 299/2010 is allowed on contest with cost against the OPs. The OPs are jointly and/or severally directed to give possession and register and complainants after receiving the balance amount including adjustment of the illegally deducted amount of Rs. 1,14,400/- and after adjustment of the said amount that will be paid by the complainants and are also directed to pay to the complainant compensation of Rs. 20,000/- (Rupees twenty thousand) only for harassment and mental agony and litigation cost of Rs. 5000/- (Rupees five thousand) only within 30 days from the date of communication of this order, i.d. an interest @ 10% p.a. shall accrue over the entire sum due to the credit of the complainant till full realisation.
The respondents herein being complainants lodged the complaint under Section 12 of the Act before the Ld. District Forum stating that they have applied for allotment of an apartment at Shristi Nagar, Asansol within the District of Paschim Burdwan and one provisional Allotment Letter of apartment No. B-3A, Poorvi Shristi Nagar, Asansol was allotted by OP No. 1 company on 09.02.2009 at a total consideration of Rs. 11,44,000/-. The complainants have made down payment of Rs. 1,71,600/-. In the agreement it was mentioned that the OP No. 1 company have a standardized approved tripartite agreement which needs to be entered into by the intending purchaser, the OP No. 1 company and the Bank and the said fact were made clear to the complainants at the time of application for allotment of said unit. The complainants have also made a payment of Rs.57,400/- by a cheque and a money receipt to that effect had been issued on 11.11.2009. The complainants alleged that the State Bank of India, Delhi, (new Rajendra Nagar Branch) was pleased to inform that the loan has been sanctioned to purchase the apartment and they were advised to contact the office at the earliest convenience for execution of the documents. The complainants have stated that time and again they have requested the OP No. 1 company that the agreement format has to be forwarded but as there was no positive response from OP No. 1 company, the complainants could not obtain loan to defray the expenses to purchase the apartment. The complainants submitted that they are ready to make payment of the entire money and the Opposite Parties should be directed to handover the possession of the flat agreed to be sold and to execute the deed of conveyance in favour of them. Hence, the respondent approached the Ld. District Forum with prayer for an order directing the Opposite Parties to withdraw the letter of cancellation issued by them and handover possession of the flat and to execute the deed of conveyance upon receipt of entire consideration money, to pay compensation of Rs. 1,00,000/- for harassment and mental agony and/or refund a sum of Rs. 1,14,400/- wrongly deducted.
The Opposite Parties by filing a written version have stated that due to non-fulfilment of the terms and conditions, they were compelled to cancel the agreement and refunded the amount paid by the complainants after deduction of 10% of the total amount of the unit. Therefore, as there was no deficiency on the part of them, complaint should be dismissed.
After assessing the materials on record, the Ld. District Forum by impugned order allowed the complaint with certain directions upon the OPs, as indicated above. To assail the said order, the OPs have come up in this commission with the present appeal.
Mr. Rajesh Biswas, Ld. Advocate for the appellants has submitted that the price of the unit was fixed at Rs. 11,44,000/- and down payment of Rs. 1,71,600/- was made by the respondents and the rest amount was scheduled to be paid as per terms and conditions of the allotment letter within 30 days from the date of allotment letter. He has drawn out attention to the provisional allotment letter dated 09.02.2009 and submitted that as the respondents have opted for down payment plan and as they paid Rs. 1,71,600/- towards application money, they were liable to pay Rs. 9,72,400/- towards the full and final payment of the total costs within 30 days from date of the letter. He has also submitted that as the respondents could not make payment, by a letter dated 25.02.2010 the appellant company cancelled the allotment of the apartment and after deduction of 10% of the unit price out of total payment of Rs. 2,29,000/- refunded Rs. 1,14,600/-. Therefore, as there was no deficiency in services on the part of appellant company, the Ld. District Forum should have dismissed the complaint. He has further submitted that the Ld. District Forum has wrongly held that the appellant/OP company has failed to provide the necessary documents to the complainants/respondents for securing loan from State Bank of India. In this regard, Ld. Advocate for the appellant has drawn out attention to the allotment letter wherein it has been categorically mentioned that the appellant company is engaged in developing the entire project with the loan assistance of Housing of Urban Development Corporation Limited (HUDCO) to whom it has mortgaged the entire property towards security for loans. Hence, the right created therein is subject to the prior mortgage/chargeable of HUDCO, which shall be discharged only after the dues of HUDCO is clear and the written permission from the HUDCO to that effect is obtained. Therefore, when the respondents being well aware about such terms and conditions agreed to purchase the apartment of down payment plan and failed to make payment to purchase the flat/unit, there was no deficiency in services on the part of appellant company and as such order being not sustainable on the facts , the impugned order is liable to be set aside.
Despite notice, none appears for the respondents.
We have considered the submission made by the Ld. Advocate for the appellants and scrutinised the materials on record.
Undisputedly, the respondents being son and mother in relation have been living New Delhi had applied for purchasing of an apartment from the appellant company in their project on Shristi Nagar, Asansol at a total consideration of Rs. 11,44,000/- and a down payment of Rs. 1,71,600/- was paid by the respondents. On 09.02.2009 the appellant company issued one provisional Allotment Letter of two BDR apartment at Poorvi being apartment No. B-3 A at shristi Nagar, Asansol and the total costs of the unit was settled at Rs. 11,44,000/-. It is not in dispute that the respondents had paid Rs. 1,71,600/- at the time of application money and further paid a sum of Rs. 57,400/- aggregating Rs. 2,29,000/-.
The whole dispute cropped up for non-availing of loan by the respondents. Evidently, the State Bank of India, Rajendra Nagar Branch (New Delhi) agreed to provide house building loan to the respondents but the respondents could not avail the loan facility as the entire project was kept under mortgage under Housing and Urban Development Corporation Limited (HIDCO), to whom the developer company has mortgaged the entire property towards the security for loans.
Evidently, on 10.12.2009 the respondent wrote a letter to the respondent No. 2 i.e. the Vice President (marketing) of appellant company stating that SBI, Delhi could not disburse the loan as they could not submit relinquishment letter from HUDCO. In this backdrop, by a letter dated 25.02.2010 the appellant company cancelled the allotment and deducted 10% of the total price of the apartment i.e. Rs. 1,14,400/- out of total price of Rs. 11,44,000/-.
In this regard, it would be pertinent to have a look to clause 6 of the terms and conditions of the agreement which runs as follows:
“6. Upon withdrawal cancellation of the booking by the Allottee(s) after the lottery, but before delivery of possession is made over to the Allottee (s) the money paid by the allottee(s) shall be refunded to him without any interest and after deduction a sum towards service charges when is equivalent to 5% of the total price payable for the allotted developed apartment. The allottee(s) hereby agrees/agree to such interest free refund and the deduction and further agreed/agree not to raise objection thereto.”
Therefore, keeping in view the above terms and conditions, the appellant company should not have deducted 10% of the total price and this act on the part of appellant company amounts to unfair trade practice within the meaning of Section 2(1)(r) of the Act.
What we find from the agreement is that there is stark incongruities between the remedies available to the appellant company and the respondent with regard to interest to be paid under default clause. Clauses 7 and 11 of the agreement appears to be relevant which are set out below:
“7. The Allottee (s) agrees /agree to make punctual payments of the price and/or the instalment in the manner mentioned in the Provisional Allotment Letter for the said Apartment. Any delay beyond due date will attract interest @ 15% p.a. for the period of delay up to a maximum of two months. the company reserves the right to cancel the allotment if payment including interest so calculated is delayed beyond two months from the due date of payment. As such cancellation the total deposit or instalments paid by the allottee will be refunded without any interest and after deduction of the applicable service charges.
11. If Bengal Shristi fails to deliver possession of the said apartment to the allottee(s) within the stipulated time as mentioned in clause 9 (subject to force majeure as stated in clause 10), then it shall pay compensation to the allottee(s) for the said apartment effective from the scheduled date of possession, till the actual handing over of the said apartment @ Rs. 1500/- per month.”
In a landmark decision reported in (2019) 5 SCC 725 (Pioneer Urban Land and Infrastructure Ltd. –vs- Govindan Raghavan) the Hon’ble Supreme Court observed that a terms of a contact will not be final and binding if it is shown that the flat purchasers had no option but to sign on the dotted line, on a contract framed by the builder. The provisional allotment letter and the terms and conditions annexed therewith appears to be one sided, unfair and unreasonable. The incorporation of such one sided clauses in an agreement constitutes an unfair trade practice as per Section 2(1) (r) of the Act since it adopts unfair methods or practices for the purpose of selling the flats by the builder.
The facts and circumstances and materials on record clearly indicate that the appellant company being a reputed company did not deal with the respondents/complainants in proper manner and refund of amount after deduction of 10% by violating the terms indicates the intention of the appellant company which amounts not only deficiency in rendering services within the meaning of Section 2(1)(g) read with Section 2(1)(o) of the Act but also amounts to unfair trade practice as per Section 2(1)(r) of the Act.
Considering the above, we do not find any reason to hold any contrary view of the Ld. District Forum that the appellant company should have given an opportunity to the respondents/complainants to explain their p
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osition and to ascertain whether they are interested to purchase the unit or not but without adhering to the same, the sudden cancellation of the allotment was a gross negligence and deficiency on the part of appellant company. In view of the above, the impugned order is modified to the extent that the appellants/OPs jointly and/or severally to give possession, register and execute the deed of conveyance in respect of flat in question in favour of respondents/complainants as per Allotment Letter dated 09.02.2009 after receipt of the balance consideration amount within 90 days from date, in default the appellant company/OP company shall refund Rs. 57,200/- i.e. 5% of the total price in favour of the respondents/complainants (as per agreement) within one month thereafter, failing which the said amount shall carry simple interest @ 10% p.a. from date till its repayment. However, considering the facts and circumstances, the appellants/OPs shall have no obligation to pay compensation of Rs. 20,000/- or litigation costs of Rs. 5,000/-. With the above observations and directions, the instant appeal stand disposed of. The Registrar of this Commission is directed to send a copy of this order to the Ld. District Consumer Disputes Redressal Forum, Kolkata, Unit- I for information.