R.K. Agrawal, President
1. The present Consumer Complaint has been filed under Section 21(a)(i) of the Consumer Protection Act, 1986 (for short “the Act”) against Ozone Projects Private Limited through its Managing Director, Mr. S. Vasudevan (hereinafter referred to as the ‘Builder’).
2. The facts of the case as enumerated in the Complaint are that in response to an advertisement of the Builder proposing to develop and sell Residential Apartments in their Project ‘The Metrozone’ located at Koyambedu, Chennai (hereinafter referred to as ‘Project’) and the assurance given by the Representative of the Builder that the Project would be ready for occupation by November 2012, Mr. Haresh Bathija and his wife Kiran Dhameja (hereinafter referred to as ‘the Complainants’) purchased one Flat from the Builder in their Project for the use of his parents by availing Housing Loan from the HDFC Bank. An ‘Agreement for Sale’ was entered between the Parties on 30.11.2010 to purchase the Schedule D Property being an undivided share (UDS) of 564 sq.ft. in the Schedule C Property together with all other rights for a consideration of Rs. 22,56,000.A Construction Agreement dated 30.11.2010 was also executed between the Parties for purchasing a Flat, i.e., Unit No. H-202 in Tower H/2 measuring an area of 2062 sq. ft. with one car parking at a cost of Rs. 1,21,76,070. The total sale consideration agreed was fixed at 1,49,05,152. As per Construction Agreement, the Builder was to handover the possession of the flat within 2 years from the date of Agreement, i.e., by 30.11.2012. The Complainant deposited a sum of Rs. 1,38,55,893, i.e., more than 90% of the sale-consideration with the Builder despite that the Builder failed to deliver the possession of the flat within the stipulated period. The Complainants requested the Builder to adjust the compensation for delayed possession amounting to Rs. 3,73,710 as on October 2013 from the balance outstanding amount payable against the cost of the flat. The Builder agreed and sought few days’ time to arrive at the actual outstanding amount. Despite that after repeated requests and reminders, Builder failed to confirm the balance outstanding amount to the Complainants. The Complainants deposited a sum of Rs. 14,10,974 towards the completion of internal plastering installment on 22.10.2013. It is alleged that despite depositing more than 90% of the total purchase consideration as on 22.10.2013, Builder failed to handover the possession of the Flat even after 5 years of the Construction Agreement. The Complainant sent a Legal Notice to the Builder on 26.9.2016 demanding payment of Rs. 42,07,000 towards compensation for the delay in handing over the possession of the Flatin terms of Clause 7 of the Agreement executed between the Parties. The Builder sent a statement on 28.9.2016 whereby compensation was calculated at Rs. 8,74,975.The Builder sent Reply to the Legal Notice sent by the Complainant asking him to meet for amicable settlement. But the Complainant did not convince with the reply and preferred to file a Consumer Complaint before the Tamilnadu State Consumer Disputes Redressal Commission at Chennai. Vide Order dated 7.8.2018, the State Commission returned the Complaint to the Complainant for presenting the same before the proper Forum. Consequently, alleging Unfair Trade Practice and deficiency in service on the part of the Builder for not handing over the possession of the flat within stipulated period despite receiving more than 90% of the sale consideration and not paying the compensation for delay in possession as per Clause 7 of the Construction Agreement, the Complainant has filed the present Complaint before this Commission seeking following prayer:
“(i) Direct the Opposite Party to deliver the possession of the Residential Unit after completing in all respects in a liveable condition with all amenities, facilities including roads, water/electricity/sewerage connections, not limited to herein, and as represented and projected by the Opposite Party in its “Brochure” together with all necessary governmental clearances, within the time frame as may be stipulated by this Hon’ble Commission;
(ii) Direct the Opposite Party to pay compensation to the Complainants herein amounting to Rs. 1,16,31,116 which is 15 per sq. ft. per month for delay in delivery of the flat with interest @18% p.a. thereon towards delay in payment of above said compensation as agreed by the Opposite Party together with future agreed compensation and interest till the date of making such payment by the Opposite Party herein and 18% interest on the amount paid by the Complainants herein;
(iii) Direct the Opposite Party to pay compensation of Rs. 10,00,000 towards for mental agony, torture, hardship & depression caused and monetary loss caused on account of ‘Deficiency of Service’ committed by the Opposite Party besides Unfair & Restrictive Trade Practice adopted by the Opposite Party;.
(iv) Alternative cost of Rental accommodation amounting to Rs. 13,20,000 at the rental rate of 20,000 per month for a period of 65 months commencing from Feb. 2013 till August 2018 and further alternatives cost of rental accommodation till the date of Order/Decree by this Hon’ble Commission; and
(v) That the Opposite Party is liable to pay the differential amounts in the Stamp duty and Registration fee as per the revised market rates of lands in Urban as per the provisions of Revised Guideline Value in Tamil Nadu as the Opposite Party has failed to complete the registration and handing over of possession as on date;
(vi) The Opposite Party be directed to pay the Complainants herein all legal costs at least a sum of Rs. 1,00,000 including Court fees, lawyer professional fees, travel and lodging expenses incurred by the Complainants herein in the proceedings filed before this Hon’ble Commission;
(vii) Pass such other Order or Orders as this Hon’ble Commission may deem fit and proper in the facts and circumstances of the case and thus, render justice.”
3. The Opposite Party Builder contested the Complaint by filing its Written Statement and denied the contents of the Complaint. It was stated that the Complainant had violated the Arbitral Clause of the Agreement by filing the present Complaint. It was stated that as per the Construction Agreement dated 30.11.2010 the anticipated date of delivery was within 2 years but the same was subject to force majeure and several unforeseeable circumstances. It was also submitted that as per Clause 4(e) and (f) of the Construction Agreement, the Complainant was bound to make the payment as per Schedule and to keep the Opposite Party Builder free from any loss due to non-payment of the installment on time. The Complainant did not make the payment as per Schedule and there was cumulative delay of more than 765 days in remitting ‘Milestone Payments’.’Milestone Payments’ means once the mutually agreed stage of construction is reached, a demand will be raised by the Builder seeking payment for the milestone achieved. As per the demand notices, 10 days’ time was provided from the date of intimation of achieving each milestone to the Complainant. Although as per Clause 5(b) of the Construction Agreement, Opposite Party Builder was entitled to terminate the Agreement in case of breach of the payment terms by the Complainant, yet they neither terminated the Agreement nor charged any escalation charges from the Complainant but extended all possible support to the Complainant. The Complainant remained silent for about 4 years and suddenly asked for compensation for delay in terms of Clause 7 of the Construction Agreement. It was submitted that as per Clause 7(2) for grant of damages, the installments were to be paid as per the Payment Schedule, which the Complainant had not adhered to.
4. It was also submitted that the delay in handing over the possession was neither willful nor wanton but due to the reasons which were beyond their control. They got the plan approved from State Government in April 2009, which was valid for 3 years but due to short supply of construction material, restrictions imposed by the State Government on other State labours they could not complete the Project within three years. Considerable time was lost in obtaining statutory approvals for getting Revised Planning Permission from the Government Authorities.
5. It was further submitted that the Builder obtained Completion Certificate from the Government Authorities in January 2016 for Tower H in which the Complainant had booked his Unit. Possessions of several apartments in Tower H have been handed over to the respective owners from January 2016 and they have settled in satisfactorily without any complaints. Complainants’ flat was ready for fit out by January 2016 and for delivery by August 2016 but despite informing to the Complainants for getting the possession after paying 10% balance amount, the Complainants were unwilling to pay the outstanding amount and taking the possession of the Flat. It was also submitted that as a goodwill gesture, they offered to waive off Rs. 8,74,975 towards the delay interest payable by the Complainants, though the delay was neither wilful nor wanton, and requested the Complainant to pay Rs. 2,52,447 and get their sale deed registered and take possession of the Flat. Despite that the Complainants did not pay the balance amount but demanding an exorbitant sum of Rs. 42,07,000 towards delay in handing over the possession of the Flat and this would show that the Complainant was not interested in taking possession of the Flat. Learned Counsel for the Opposite Party Builder relied upon the Judgment of the Hon’ble Supreme Court in Bangalore Development Authority v. Syndicate Bank, II (2007) CPJ 17 (SC)=I (2008) SLT 761=(2007) 6 SCC 711, in which it was observed that having enjoyed the full appreciation of the Flat value and not being put to any penalty of paying the escalation cost, the Complainant is not entitled for any interest. He submitted that there is no deficiency in service on their part and prayed that the Consumer Complaint be dismissed.
6. I have heard Mr. Prateek Chandra, learned Counsel for the Complainants, Mr. Anish R. Shah, learned Counsel for the Opposite Party Builder, perused the Consumer Complaint, Written Statement and the material available on record.
7. During the proceedings, IA No. 7861/ 2019 was filed by the Complainants seeking a direction to the Opposite Party Builder to deliver the possession of Flat, i.e., Unit No. H-202 in the building situated at No. 44, Pillaiyar Koil Street (Jawaharlal Nehru Road), Anna Nagar, Chennai 600040. On 5.12.2019, Complainant handed over a cheque of Rs. 2,52,447 to Mr. Anish R. Shah, learned Counsel for the Opposite Party and the Builder was directed to hand over the possession of the flat in question, i.e., Unit No. H-202, in a habitable condition to the Complainant on 12.12.2019 and the IA No. 7861/2019 was disposed off.As such the only question with regard to compensation to be awarded to the Complainants for delay in delivery of the possession, remains to be decided.
8. Mr. Prateek Chandra, learned Counsel for the Complainants submitted that they are entitled for the compensation for delay in possession as per Clause 7 of the Construction Agreement, which reads as under:
“(b) The Developer shall handover possession of the Residential Unit to the Allottee(s) after the same is ready for occupation and subject to payment of all the amounts due under this Agreement. In the event of delay in handing over possession of the residential unit beyond the time period specified above, not attributable to any of the reasons stated above, the Developer shall pay to the Allottee(s) 15 per sq. ft. per month till such time possession of the residential unit is handed over or intimated to the Allottee, whichever is earlier, subject to the Allottee(s) having paid all the instalments as per the Payment Schedule. In the event of such delay exceeding 6 months, the Developer shall pay to the Allottee(s), interest at the rate of 10% per annum, pro-rated for the further periods of such delays. The interest shall be calculated on all amounts received by the Developer from the Allottee(s), excluding the taxes and deposits. Such penalty shall be applicable only if the Allottee(s) has/have made all payments to Developer as per the Payment to Developer as per the Payment Schedule.”
9. Per contra, Mr. Anish R. Shah, learned Counsel for the Opposite Party Builder submitted that the Complainants are not entitled for any compensation for delay in offer of possession as they had not followed the schedule of payment and the delay had occurred due to obtaining statutory approvals which were beyond their control. However, they have already adjusted Rs. 8,74,975 towards delay compensation in the balance amount payable by the Complainants and offered the possession of the flat to the Complainant vide letter dated 26.12.2016 to take the possession of the Flat after paying balance amount but the Complainants did not come-forward to take the possession.
10. Having gone through the material available on record, evidence adduced by the Parties as well as the oral submissions made by both the Parties, I am of the view that under the facts and circumstances of the case, the Complainants are entitled for interest @8% p.a. on the deposited amount towards compensation for delay in handing over the possession of the flat. Even though, the Opposite Party Builder had sent a letter of offering possession of the Flat on 26.12.2016 but on account of certain issues, the possession was not delivered/taken. This Commission vide Order dated 5.12.2019 had directed the Opposite Party Builder to hand over the possession of flat, i.e. “Unit No. H-202” to the Complainants in a habitable condition on 12.12.2019. For ready reference the Order dated 5.12.2019 is reproduced below:
“IA No. 7861 of 2019
This Application has been filed by the Complainants, seeking a direction to the Opposite Party to deliver the possession of flat, i.e. “Unit No. H-202”, in the building situated at No. 44, Pillaiyar Koil Street (Jawaharlal Nehru Road), Anna Nagar, Chennai-600040.
We have heard Mr. Haresh Bhatija, Complainant No. 1, who has appeared in person, and Mr. Anish R. Shah, learned Counsel for the Opposite Party. Learned Counsel for the Opposite
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Party invited our attention to Annexure A-1 at page 16, filed along with the Application, wherein a demand of Rs. 2,52,447, after deducting the delay compensation of Rs. 8,74,975, was made by the Opposite Party in order to give the possession of the flat in question. Mr. Haresh Bhatija, Complainant No. 1, states that he has handed over a cheque of Rs. 2,52,447 to Mr. Anish R. Shah, learned Counsel for the Opposite Party, today. The cheque be received by the learned Counsel for the Opposite Party and the possession of flat in question, i.e. “Unit No. H202” be delivered to the Complainants in a habitable condition on 12.12.2019. The Application stands disposed of.” 11. It would be appropriate in the interest of justice that the Opposite Party Builder be directed to pay compensation for delayed delivery of possession in the form of interest @8% p.a. from the date of delivery of possession as specified in the Agreement till the date of Order vide which Opposite Party Builder was directed to deliver the possession of the Flat. Accordingly, the Opposite Party Builder is directed to pay interest @ 8% p.a. to the Complainants with effect from 30th November 2012 (date of delivery of possession) to 5th December 2019 (date of Order directing Opposite Party to deliver the possession) within a period of six weeks from the date of receipt a copy of this Order. It is made clear that the amount of Rs. 8,74,975 already received by the Complainants as compensation, will be adjusted by the Opposite Party Builder against the amount calculated in terms of this Order. Ordered accordingly.