Samaresh Prasad Chowdhury, Presiding Member
The instant complaint under Section 17 (inadvertently mentioned under Section 12) of the Consumer Protection Act, 1986 (for brevity, ‘the Act’) is at the behest of an intending purchaser against the Developer/Builder (Opposite Party No.1) and its executives (Opposite Party Nos. 2 to 4) on the allegation of deficiency of services, primarily on the part of OP No. 1 in respect of an apartment and car parking space in a dispute of housing construction.
Succinctly put, the Complainants’ case is that on 05.12.2007 he entered into an agreement with the OP No. 1 to purchase of an apartment being No. 0801 on 8th floor, Tower-04 having a super built up area of 1893 sq. ft more or less in the complex ‘Harmony’ in Uniworld City at New Town, Kolkata along with one covered car parking space and proportionate undivided share in the common areas at a total consideration of Rs. 62,53,485/- (contractual price). The complainant has stated that he has already paid a total sum of Rs. 60,34,768/- to the OP adhering strictly to the terms and conditions of the agreement leaving a balance of Rs. 2,18,717/- payable at the time of offering possession. The complainant has alleged that as per terms of the agreement, the OP No. 1 company was under obligation to deliver possession of the apartment and car parking space within 31.03.2011. The complainant has stated that on several times he requested the OP No. 1 company to deliver possession but all his requests and persuasions including legal notice dated 10.03.2016 was not heeded to. Hence, the complainant approached this commission with prayer for several reliefs, viz. (a) to direct the Opposite Party No. 1 company to refund Rs. 60,34,768/- along with interest @ 24% p.a. from 07.12.2010; (b) to direct the Opposite Party No. 1 company to pay Rs. 10,00,000/- as compensation for harassment and mental agony; (c) to direct the Opposite Party No. 1 company to pay Rs. 50,000/- as litigation costs etc.
The Opposite Party by filing a written version has admitted the agreement and payment of part consideration amount of Rs. 60,34,768/- by the complainant but it has been stated that due to some unforeseen reasons they could not complete the project and perform their obligations in terms of the agreement and in this regard, they will pay compensation to the purchaser @ Rs. 5/- per sq. ft. per month for the period of delay in offering the delivery of the same for the period indicated in the agreement. The OPs have stated that as there was no deficiency in services on the part of them the complaint should be dismissed.
Both the parties have tendered evidence through affidavit. They have also given reply against the questionnaire set forth by their adversaries. Besides the same, the parties have relied upon several documents annexed with the petition of complaint and the evidence on affidavit. At the time of final hearing on behalf of OP No. 1company BNA has been filed. The complainant was also represented through the Ld. Advocate but in accordance with Regulation 13(2) of the Consumer Protection Regulations, 2005 no BNA has been filed.
The pleadings of the parties and the evidence on record make it quite clear that the complainant being the applicant signed an application form and accepted the terms and conditions mentioned therein issued by OP No. 1 company for allotment of the residential Unit No. 0801 at Tower No. 8, 8th floor having a super built up area 1893 sq. ft. along with one covered car parking space in the complex ‘Harmony’ in Uniworld City, New Town, Kolkata, being developed by OP No. 1 company at a total consideration of Rs. 62,53,485/- including club membership charges under time linked payment plan. The complainant had booked the said apartment on payment of Rs. 5,86,000/- by cheque bearing No. 006415 dated 26.11.2017 drawn on the Axis Bank Ltd. in favour of OP No. 1 company. It also remains undisputed that on 30.11.2017 the OP company had issued an allotment letter along with payment schedule of the total consideration amount to the complainant intimating that the complainant had been allotted the said apartment. Thereafter, on 05.12.2007 one buyer’s agreement was executed between OP company as developer/builder and the complainant as purchaser in respect of the said apartment. It is also evident that pursuant to the terms of the said agreement dated 05.12.2007 the OP company send demand letters to the complainant and the complainant from time to time paid the instalments aggregating payment of a sum of Rs. 60,35,635/- including service tax and interest.
As per terms of the agreement the OP company was under obligation to handover the subject flat to the complainant within 30.03.2011. Admittedly, even after expiry of about long 9 years from the committed date of possession, the OP No. 1 company has failed to deliver the possession. In this regard, OP No. 1 company has failed to advance any force majeure circumstances which prevented them to comply with the terms and conditions of the agreement.
It is undisputed proposition of law that the parties are bound by the terms of agreement. When either of the parties did not pick up any quarrel with the terms and conditions of the agreement, they are certainly bound to follow the terms and conditions as contained in the agreement. In a case reported in AIR 1996 SC 2508 (Bharti Knitting Co. – vs. – DHL World Wide Express Courier Division of Airfreight Ltd.) the Hon’ble Supreme Court has observed thus:-
“It is seen that when a person signs a document which contains certain contractual terms, as rightly pointed out by Mr. R.F.Nariman, Ld. Senior Counsel, that normally parties are bound by such contract; it is for the party to establish exception in a suit. When a party to the contract disputes the binding nature of the signed document, it is for him to prove the terms in the contract or circumstances in which he came to sign the documents need to be established. The question we need to consider is whether the District Forum or the State Commission or the National Commission could go behind the terms of the contract? It is true, as contended by Mr. M.N.Krishanmani, that in an appropriate case, the Tribunal without trenching upon acute disputed question of facts may decide the validity of the terms of the contract based upon the fact situation and may grant remedy. But each case depends upon it own facts. In an appropriate case where there is an acute dispute of facts necessarily the Tribunal has to refer the parties to original Civil Court established under the CPC or appropriate State law to have the claims decided between the parties. But when there is a specific term in the contract, the parties are bound by the terms in the contract”
Ld. Advocate for the Complainants has submitted that non-delivery of possession within the stipulated period itself amounts to deficiency in services, more particularly, when no Force Majeure circumstances has been advanced by the O.P. He has further submitted that the amount of compensation for the delay as mentioned in Clause 5.c.ii of the agreement which provides compensation of Rs. 5/- per sq. ft. per month for the delay in offering delivery of the said apartment is much less than the amount of 18% claimed by the O.P. in case of delay in payment of instalments within time. Placing reliance to a judgement/final order of the Hon’ble National Commission in CC/1046/2015 [Vikas Kaul & Anr. – Vs. – M/s. Unitech Ltd.] he has submitted that considering the abnormal delay on the part of OP in completing the construction and inability to offer possession as on today, the OP company has committed clear deficiency in rendering services. Therefore, according to him, the complainant is legally entitled to seek refund of money which he has paid to OP No.1 company along with appropriate compensation. He has also placed reliance to a judgement of the Hon’ble National Commission in CC/398/2015 [Sipra Thomas –Vs. – Bengal Unitech Universal Infrastructure Pvt. Ltd.] and claimed refund of the amount along with interest @24% p.a.
On the other hand, Ld. Advocate for the O.P. has contended that the OP company is ready and willing to handover the subject flat to the complainant and as delay for delivery of possession was beyond the control of them, they are obliged to pay Rs. 5/- per sq. ft. per month in terms of clause 5.c.ii of the Agreement. The clause 5,c.ii of the agreement reproduces below : -
“That the Developer would pay to the Purchaser compensation @ Rs. 5/- per sq. ft. per month for the period of delay in offering the delivery of the said Apartment beyond the period indicated in clause 5.a.(i), save and except for reasons beyond the reasonable control of the Developer and the Force Majeure events specified in this Agreement. These charges would be adjusted at the time of final notice of possession. The Developer will not be under any other liability to pay damages or any other compensation to the purchaser.”
On reading of clause 5.c.ii, it appears that this clause is applicable only in cases where the Opposite Party fails to deliver possession of the apartment within the stipulated time and the compensation is to be paid every month for the delay.
In question No. 12 on behalf of complainant it was put to the OPs- will you accept that more than six years has lapsed since the promised date of the land of apartment i.e. on 31st March, 2011 till the date of filing complaint by complainant and will the OP No. 1 failed to deliver the possession of the said apartment to the complainant? To which on behalf of OP company replied- “ The delay in construction of Harmony is attributed to delays in obtaining statutory infrastructural provisions pertaining to road, electricity, water sewerage, sanctions etc beyond the control OP No.1. However, the construction of Uniworld City is steadily progressing. The OP No.1 shall, however, remain committed to their customers and handover the possession subject to the terms of the said agreement.”
From the above statement of OP company it would reveal that the OP No. 1 company has collected money from the complainant without obtaining the required permission including sanctions. Relying upon the decision of the Hon’ble Supreme Court reported in II (2000) CPJ1 (Ghaziabad Development Authority –vs- Union of India) the Hon’ble National Commission in a decision reported in (2007) CPJ 7 [Kamal Sood – Vs. – D.L.F. Universal Ltd.] has observed that it is unfair trade practice on the part of developer to collect money from prospective buyers without obtaining the requisite permissions such as Zoning Plan, Lay Out Plan etc. It is the duty of the builder to obtain the requisite permission or sanctions, in the first instance, and, thereafter, recover the consideration money from the purchaser. Admittedly, the OP company did not obtain required permission prior to collection almost entire consideration amount and this act on the part of OP company not only construes deficiency of services but also falls under unfair trade practice, as defined under Section 2(1)(r) of the Act.
In another case reported in II (2019) CPJ 29 (Kolkata West International City Pvt. Ltd. –vs- Devasis Rudra) the Hon’ble Supreme Court has observed as hereunder:
“.......It would be manifestly unreasonable to construe the contract between the parties as requiring the buyer to wait indefinitely for possession. By 2016, nearly seven years had elapsed from the date of the agreement. Even according to the developer, the completion certificate was received on 29 March 2016. This was nearly seven years after the extended date for the handing over of possession prescribed by the agreement. A buyer can be expected to wait for possession for a reasonable period. A period of seven years is beyond what is reasonable. Hence, it would have been manifestly unfair to non-suit the buyer merely on the basis of the first prayer in the reliefs sought before the SCDRC. There was in any event a prayer for refund.
In the circumstances, we are of the view that the orders passed by the SCDRC and by the NCDRC for refund of moneys were justified.”
In the case before hand also, the complainant cannot be made to wait indefinitely for possession of the unit, as the construction is yet to be completed. Therefore, we are of the view that the complainant is entitled for refund of the principal amount with reasonable compensation. For the purpose of adjudication on the point of compensation, in our case, it would be relevant to regard clause 5.e which provides alternative property/compensation. The said clause is reproduces below –
"That if for any reason the Developer is not in a position to offer the Apartment herein applied for allotment, the Developer shall offer the Purchaser an alternative property or refund the amount in full with simple interest @ 10% per annum without any further liability to pay any damages or compensation.”
On perusal of the above, it is quite clear that if for any reason, the O.P./developer is not in a position to offer possession of the apartment as an alternative relief, the O.P./develope
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r shall refund the amount of Rs. 60,34,768/- along with compensation in the form of simple interest @ 10% p.a. without any further liability. Therefore, in view of the above clause, the O.P. is liable to pay simple interest @ 10% on the deposited amount as compensation for their default in paying respect to the terms of agreement between the parties. Evidently, OP company has failed to deliver possession of the apartment even after lapse of almost 9 years from the committed date of possession. Thus, in our view, this is a case of OP company not being in a position to offer possession of the apartment as an allottee cannot be expected to wait for possession of the apartment for an indefinite period. Under compelling circumstances the complaint has to approach this commission for which he is also entitled to litigation costs which we quantify at Rs. 20,000/-. With the above discussion, the complaint allowed on contest with the following directions: i. The Opposite Parties shall refund the amount of Rs. 60,34,768/- received from the complainant along with compensation in the form of simple interest @10% per annum from the date of each payment till the date on which the entire amount along with compensation in terms of this order is paid; ii. The Opposite Parties shall pay Rs.20,000/- as cost of litigation to the complainant; iii. The payments in terms of the above order shall be made within 45 days from date.