w w w . L a w y e r S e r v i c e s . i n



Usha Yadav v/s M/s. Manohar Infrastructure & Constructions Pvt. Ltd.

    Complaint Case No. 63 of 2020

    Decided On, 01 July 2021

    At, Union Territory Consumer Disputes Redressal Commission UT Chandigarh

    By, THE HONOURABLE MR. JUSTICE RAJ SHEKHAR ATTRI
    By, (RETD.) PRESIDENT & THE HONOURABLE MRS. PADMA PANDEY
    By, MEMBER

    For the Complainant: Devinder Kumar, Advocate.



Judgment Text

Raj Shekhar Attri, President

The complainant has filed this complaint seeking refund of the amount paid by her to the tune of Rs.42,25,000/- to the opposite parties towards purchase of a plot in the project launched by them under the name and style ‘The Palm”, New Chandigarh, Mohali, Punjab, on the ground that they failed to offer possession thereof, for dearth of construction and development activities and also necessary approvals/sanctions. It is the case of the complainant, that in the first instance, a plot measuring 250 square yards had been purchased by her alongwith her cousin sister-Sumitra Devi, vide application dated 03.03.2012, on making payment of booking amount of Rs.13,50,000/-, yet, thereafter she (Sumitra Devi) relinquished her rights therefrom, for some personal reasons. As such, all the necessary documents, Annexure C-6 to C-8, were executed by her on 18.04.2014. Accordingly the name of the complainant, as sole owner of the plot in question, was updated by the opposite parties, vide letters dated 25.04.2014, Annexure C-9 and 22.07.2014, Annexure C-10 and in this manner, the complainant became the sole owner of the said plot. It has been stated that to make payment towards price of the plot in question, the complainant also availed housing loan to the tune of Rs.2,25,000/- from HDFC Limited, vide tripartite agreement dated 11.02.2014, Annexure C-11. It has been averred that the said loan amount stood repaid and NOC dated 01.06.2016, Annexure C-19, in that regard has also been obtained from the HDFC Limited.

It has been pleaded that despite the fact that substantial amount of Rs.42,25,000/-, stood received by the opposite parties, yet, neither agreement in respect of the plot was executed between the parties nor possession thereof was offered to the complainant within a reasonable period from the date of booking and on the other hand, the opposite parties kept on raising demands. Plot buyer’s agreement, Annexure C-20, was ultimately executed after a huge delay, on 21.11.2017. It has been pleaded that though it was promised by way of Clause 4.1 of the said agreement that possession of the plot no.471 will be delivered within a period of 24 months from the date of allotment, yet, the opposite parties failed to do so, for want of development activities at the project site.

By stating that the aforesaid act and conduct of the opposite parties in not delivering possession of the plot in question, despite the fact that the complainant started pouring money from 2012 itself, amount to deficiency in providing service and adoption of unfair trade practice, this complaint has been filed by the complainant, seeking refund of amount paid alongwith interest, compensation etc.

The claim of the complainant has been contested by the opposite parties on numerous grounds, inter alia, that she has concealed material facts from this Commission; that she being speculator did not fall within the definition of “consumer”; that the initial booking was got cancelled by the complainants, as Sumitra Devi withdrew from it, as a result whereof, fresh application for booking of a plot was filled by the complainant on 25.04.2014, Annexure C-9 and as such, date of booking of plot needs to be considered from the said date and not from 03.03.2012; that thereafter the complainant sought cancellation of the plot vide letter dated 26.09.2015 Annexure O-2 for which she also submitted affidavit dated 26.09.2015, Annexure O-3 and requested for allotment of some other plot, which was acceded by the opposite parties; that the complainant defaulted in making payments, as such, number of reminders were sent to her, in the matter, to come forward for making payment as also execution of agreement but she did not do so; that agreement dated 21.11.2017 was executed between the parties, in respect of plot no.471; that since as per clause 4.1 of the said agreement, possession of the plot was to be delivered within a period of 24 months plus with grace period of 6 months i.e. on or before 20.05.2020, which was extendable on account of force majeure circumstances, as such, this complaint having been filed on 02.03.2020 is premature; that delay in execution of the agreement was on the part of the complainant and not the opposite parties, as despite several requests she failed to come forward for the same; and that it was not the sale of goods as such consumer complaint is not maintainable.

On merits, it has been stated that that the project of the opposite parties has been got registered under the Real Estate (Regulation and Development) Act, 2016 (in short, the RERA) on 25.09.2017; that completion period for the project was given upto 13.06.2018, vide supplementary agreement dated 16.06.2016 executed with the Government; that later on exemption from the applicability of provisions of the Punjab Apartment and Property Regulation Act, 1995, (PAPR Act) stood granted by the Government on 25.01.2017 and as such, exemption granted will have retrospective effect; that the Competent Authority extended completion period of the project upto 13.06.2020; that claim of the complainant seeking higher rate of interest on the deposited amount is totally unjustified. Rather, it should be as specified under Section 19 of the RERA i.e. MCLR + 2% interest; that the complainant is entitled to interest @6% p.a. only as envisaged in clause 4.3 of the agreement; that even the Hon’ble Supreme Court of India in DLF Homes Developers Limited Vs. Capital Greens Flat Buyers Association, Civil Appeal No.3864-3889 of 2020, decided on 14.12.2020 and Wg. Cdr. Arifur Rahman Khan and Aleya Sultana and Ors Versus DLF Southern Homes Pvt. Ltd. Civil Appeal No. 6239 of 2019, decided on 24.08.2020, granted interest @6% p.a.

However, ironically, it has been claimed in the reply that the development work is at advance stage; that some wings of flats have already been delivered to the customers; that the opposite parties have also sought extension for completing of the project from the competent authorities, which has been granted to it. While applying the theory of force majeure circumstances (which means irresistible circumstances beyond ones control such like act of God), it has been stated that delay in delivery of possession of plots occurred on account of shortage of building material, as there was ban on mining by the Punjab Government because of litigation with sand-mafias; and that the competent authorities also delayed in granting approvals with regard to sewerage and drainage connections. It has been stated that the opposite parties suffered substantial loss on account of the reasons given above. It has been pleaded that the Govt. and Banks have come forward to help the builders/developers; that real estate suffered a lot because of slow down in the real estate; that due to slowdown in the real estate market, the Govt. of Punjab has issued Notification dated 30.01.2020 wherein, the completion period of the projects has now been extended till 31.12.2022; that COVID-19 also gave a set back to the opposite parties, yet they are trying to complete the project within the extended period; that possession of the plot in question is ready and the complainant can come forward to take over the same on making remaining payment; that still if the complainant wants refund of the amount paid, forfeiture clause will be made applicable. Remaining averments of the complaint have been denied. Prayer has been made to dismiss the complaint with costs.

In the rejoinder filed, the complainant reiterated all the averments contained in the complaint and controverted the averments contained in written reply filed by the opposite parties.

The parties led evidence in support of their case. Counsel for the parties submitted that the complaint filed on behalf of the complainant and also the reply filed on behalf of the opposite parties, be treated as their written arguments, respectively.

We have heard the contesting parties and have gone through record of the case, very carefully.

First we will deal with the objection taken by the opposite parties to the effect that the complainant did not fall within the definition of ‘consumer’, it may be stated here that the objection raised is not supported by any documentary evidence and as such the onus shifts to the opposite parties to establish that the complainant has purchased the plot in question, in the manner, explained above, to indulge in ‘purchase and sale of plots’ as was held by the Hon’ble National Commission in Kavit Ahuja vs. Shipra Estates I (2016) CPJ 31 but since they failed to discharge their onus, hence we hold that the complainant is a consumer as defined under the Act.

Mere fact that in the first instance, the complainant had purchased the unit in question, jointly, alongwith her cousin sister, who later on relinquished her right therefrom, is not a ground to shove the complainant, out of the definition of consumer. In this view of the matter, objection taken by the opposite parties stands rejected.

There is no dispute with regard to the fact that, in the first instance, a plot measuring 250 square yards for total sale consideration of Rs.45 lacs, had been purchased by the complainant, alongwith her cousin sister-Sumitra Devi, vide application dated 03.03.2012, Annexure C-1, on making payment of booking amount of Rs.13,50,000/-. Thereafter, admittedly, Sumitra Devi relinquished her rights from the said plot for some personal reasons, which was accepted by the opposite parties. Thereafter, the name of the complainant, as sole owner of the plot in question, was updated by the opposite parties, vide letters dated 25.04.2014, Annexure C-9 and 22.07.2014, Annexure C-10. It is also not in dispute that as per demands raised by the opposite parties, total amount of Rs.42,25,000/-, which was equal to more than 90% of the basic sale price (Rs.45 lacs) of the said plot, stood paid by the complainant towards the said plot. However, it is coming out from the record that despite the fact that substantial amount aforesaid, stood received by the opposite parties, yet, they failed to execute agreement in respect of the plot and also failed to offer possession to the complainant. In the entire reply filed, not even a single reason has been given by the opposite parties, as to why they failed to do so, despite receiving substantial amount, referred to above, from the complainant. Thus, the act of raising demands and receiving substantial amount without executing the agreement, in respect of a plot, booking whereof was done in the year 2012, was not only unfair but illegal, which act also contravenes Section 6 (1) of the PAPR Act, which lays a duty on the opposite parties to execute the agreements for sale as per law, after obtaining the maximum sale consideration of 25%. It is apposite here to reproduce the said provision: -

“6. Contents of agreement of sale:- (1) Notwithstanding anything contained in any other law for the time being in force, a promoter who intends to construct or constructs a building of apartments, all or some of which are to be taken or are taken on ownership basis, or who intends to offer for sale plots in a colony, shall, before he accepts any sum of money as advance payment or deposit, which shall not be more than twenty five per cent of the sale price, enter into a written agreement for sale with each of such persons who are to take or have taken such apartments, or plots, as the case may be, and the agreement shall be in the prescribed form together with prescribed documents and shall be registered under the Registration Act, 1908 (Central Act No. 16 of 1906) ;

Provided that, if only a refundable application fee is collected from the applicant before draw of lots for allotment, such agreement will be required only after such draw of lots.

(2) xxxxxxxxxxxxxxxx……………...

(3) xxxxxxxxxxxxxxxxx……………….”

The opposite parties were legally bound under law to execute the agreement and to get the same registered under the Registration Act 1908, after obtaining 25% of the sale consideration, but in this case, the said provision has been violated. The opposite parties also cannot take shelter under the exemption certificate from the provisions of PAPR Act, which was issued in their favour only on 25.01.2017 i.e. much after booking of the plot in question. It has no where been proved that the said exemption will have retrospective effect but in our considered opinion, it will have prospective effect only. The opposite parties were deficient in providing service and adopted unfair trade practice on this count.

Furthermore, to defend the objection raised by Counsel for the complainant to the effect that at the time of booking of the plot and collecting money from the complainant in the year 2012, the opposite parties were not having requisite licences, approvals and permissions from the competent authorities, it has been submitted by the opposite parties, through their Counsel, that notification exempting the provisions of PAPR Act issued in favour of the company on 25.01.2017, is to be treated as retrospectively and once the same has been issued all the irregularities stood extinguished. We do not agree with the said submission for the reasons to be recorded hereinafter.

It may be stated here that this Commission has decided number of cases, in respect of the project in question, and it has been observed that it (project in question) has been got approved only on 22.03.2013. As such, it leaves no doubt with the Commission to believe that in the year 2012, money has been collected from the complainant and other prospective buyers, with animus of cheating and fraud, by launching the project and selling units/plots therein by violating the terms and conditions of PAPR Act, which act cannot be cured by obtaining the exemption from the provisions of PAPR Act, at the subsequent stage.

There is another valid reason with this Commission to hold that the money has been collected from the complainant and other prospective buyers, with animus of cheating and fraud, which act cannot be cured by obtaining the exemption dated 25.01.2017 from the provisions of PAPR Act, at the subsequent stage. Recently, in Puja Garg Vs M/s Manohar Infrastructure & Constructions Pvt. Ltd., CC No. 278 of 2019, decided by this Commission on 31.03.2021, it has come to our knowledge (when we went through the documentary evidence therein), that despite the fact that as per condition no.v) of the Letter of Intent (LOI) dated 03.05.2013 granted in favour of the opposite parties in respect of the project in question, they were directed not to advertise/launch it and not to collect money from general public for allotment of land, plot etc. without the approval of layout and zoning plans and also exemption under section 44 of PAPR Act is issued by the State Govt. yet, they violated the same and launched the project and starting selling the plots therein, starting from February 2011, when they were not even the owners of the land underneath the said project. Under those circumstances, they were held liable for adopting unfair trade practice on this count. Relevant contents of Puja Garg’s case (supra) are reproduced hereunder:

“……..The another valid reason with this Commission to hold that the money has been collected from the complainant and other prospective buyers, with animus of cheating and fraud, which act cannot be cured by obtaining the exemption dated 25.01.2017 from the provisions of PAPR Act, at the subsequent stage, is the contents of Letter of Intent (LOI) dated 03.05.2013 which was granted in favour of the opposite parties in respect of the project in question. In condition no.v) of the said LOI it has been in a very candid manner stated that the project shall not be advertised/launched and money could not be collected from general public for allotment of land, plot etc. without the approval of layout and zoning plans and also exemption under section 44 of PAPR Act is issued by the State Govt. Relevant part of the said condition of LOI is reproduced hereunder:

“v. ….The project shall not be Advertised/launched and no money will be collected from general Public for allotment of land/plot/flat/any space till such time the layout plans/Zoning plans are approved by the Competent Authority and exemption u/s 44 of PAPR Act 1995 is issued by the State Govt….” .

It is further evident from the contents of said LOI that application for setting up the residential project was moved by the opposite parties before the competent Authority, for the first time on 16.09.2011 and project was approved only on 22.03.2013. It is also evident from information dated 23.05.2016 supplied by Chief Town Planner, Punjab, that Change of Land Use was approved for the first time on 31.03.2014 and layout plan was approved only on 06.10.2015. It is also evident from the contents of notification dated 25.01.2017 aforesaid that thereafter also, the opposite parties got the layout plans revised on 21.10.2015. Thus, in the present case, despite the fact that vide condition no.v) of LOI aforesaid, it has been in a very candid manner stated that the project shall not be advertised/launched and money could not be collected from general public for allotment of land, plot etc. without the approval of layout and zoning plans, (which in the present case has been approved only on 21.10.2015) and also exemption under section 44 of PAPR Act is issued by the State Govt. (which in the present case has been issued only on 25.01.2017), yet, the opposite parties violated the same and launched the project and starting selling the plots therein, starting from February 2011, when they were not even the owners of the land underneath the said project. It is therefore held that by launching and selling the project before 25.01.2017, i.e. the date when the said exemption was granted to the opposite parties from the provisions of PAPR Act, they indulged into unfair trade practice and the said practice needs to be deprecated….”

In the present case also, the opposite parties have repeated the said violations. However, surprisingly, the Government of Punjab, Department of Housing and Urban Development (Housing II Branch) i.e. the competent Authority was well aware of the fact that the project has been launched and plots/units have been sold to the general public starting from the year 2012 itself, without necessary approvals/permissions and huge money has been collected and usurped by the opposite parties from the innocent buyers, yet, it did not hear the aggrieved consumers before granting exemption to the project on 25.01.2017 from the provisions of PAPR Act. As such, the said act of the competent authority is against the principles of natural justice; fair play and not binding on the complainant and other prospective buyers. If the competent Authorities failed to take any action under relevant Rules and Regulations against the company, no benefit can be taken out there-from by the opposite parties, in this complaint filed by the complainant under Consumer Protection Act, filed for deficiency in providing service, negligence and adoption of unfair trade practice on the part of the opposite parties.

Further, perusal of record reveals that when despite making payment of substantial amount, the opposite parties failed to deliver possession of the plot, initially booked by the complainant on 03.02.2012 in the Palm Garden, she was forced to write letter dated 26.09.2015, Annexure O-2 and affidavit of the even date, Annexure O-3, with a request to cancel the booking thereof and to allot some other plot in Palm Garden only. Be that as it may, it is further coming out from the record that thereafter, after a huge delay, agreement dated 21.11.2017, Annexure C-20 was executed between the parties, in respect of plot no.471 and that too in Palm Spring. It is further coming out from the record that in clause 2.2. of the agreement, it has been clearly written by the opposite parties that the complainant has already made payment of Rs.42,22,500/-; which was to be adjusted in the price of plot no.471. It is also coming out from the said agreement that basic sale price of the said plot was fixed at Rs.58,20,760/-. It is significant to mention here that vide Clause 4.1 of the said agreement, the opposite parties committed to deliver possession of the said plot within a period of 24 months from the date of allotment thereof or even earlier to that. Relevant part of the said clause reads as under:-

“4. HANDING OVER OF POSSESSION OF THE SAID PLOT AND EXECUTION OF DEED

4.1 Subject to other terms of this Agreement, including but not limited to timely payment of the Total Price and other charges mentioned in this Agreement, the Company shall endeavor to offer possession of the Said Plot within 24 (twenty four) months from the date of allotment with a grace period of 6 (six) months/ even earlier to said 24 (twenty four) months from date of allotment upon receipt of written intimation by the Company in this regard to the said Allottee(s).

4.2 The Allottee(s) agrees and understands that the Company shall be entitled to a grace period for applying and obtaining the occupation/completion certificate (partial or complete, as the case may be) in respect of the Said Plot and/or the Project…”

Though, it is clearly evident from the record that the opposite parties did not deliberately execute the buyers agreement for a long period, so that they are able to utilize the hard money deposited by the complainant starting from 2012, without providing anything to her; still if the period of 24 months are counted from 29.12.2015 i.e. the date when the opposite parties allowed the application dated 26.09.2015 aforesaid, then also the possession date comes to 28.12.2017. It is pertinent to mention here that the date 29.12.2015 has been assumed by this Commission, to be the allotment date in respect of plot no.471, on account of the reason that the opposite parties have miserably failed to issue any allotment letter in respect of the said plot also. Whereas, on the other hand, they were legally bound to issue allotment letter in respect of the said plot, the moment they allowed the application dated 26.09.2015 moved by the complainant for allotment of a plot in Palm Garden and should have also executed agreement in that regard within a reasonable period say two to three months, but they miserably failed to do so and on the other hand, agreement was executed after a long delay on 21.11.2017. Thus, for the inaction on the part of the opposite parties, in non-issuance of allotment letter in respect of plot no.471, they cannot seek any benefit out of it, saying that possession date has to be reckoned from the date of agreement dated 21.11.2017.

To defeat the claim of the complainant it has been submitted by the opposite parties that because as per clause 4.1 of the agreement dated 21.11.2017, Annexure C-9, it was agreed to between the parties that possession of plot no.471 will be offered within a period of 24 months plus grace period of 6 months from the date of allotment thereof i.e. latest by 20.05.2020, as such, this complaint having been filed on 02.03.2020 is premature. We do not agree with the submission made for the reasons to be recorded hereinafter.

It may be stated here that, in the first instance, when the opposite parties had received substantial amount towards booking of a plot in the project ‘Palm Garden”, from the complainant, starting from 2012 itself, then they failed to convince this Commission as to why possession thereof was not delivered to the complainant, within a reasonable period of two to three years from the date of booking. Secondly, perusal of clause 4.1 of the agreement dated 21.11.2017, which pertains to the period of possession of plot no.471 in the project Palm Spring, makes it very clear that it was also made known to the complainant that possession thereof will be delivered even earlier to 24 months from the date of allotment thereof. The opposite parties are not touching the lines mentioned in clause 4.1 of the agreement i.e. “the company shall endeavor to offer possession of the said plot…. even earlier to said 24 (twenty four) months from the date of allotment”. The opposite parties have drafted the said clause so cleverly, with a view to give twin meaning, just with the sole motive to get benefit of the same, as per their own choice in future, under prevailing circumstances. By adding the lines that possession of plot will be offered even earlier to the said 24 (twenty four) months from the date of allotment, the opposite parties were successful in making the complainant to believe that possession of the said plot will be delivered before 24 months from the date of allotment thereof, with a sole motive to usurp the remaining amount from her. However, as discussed above, the fact remained that allotment letter in respect of plot no.471, from which the exact date of delivery of possession was to be reckoned, was never issued by the opposite parties in favour of the complainant and under those circumstances, this Commission has assumed the date of allotment of plot no.471 as 29.12.2015. Thus, in our considered opinion, once the opposite parties have committed that possession of the plot no.471 will be offered to the complainant even earlier to 24 months from the date of allotment which comes to 28.12.2017 as explained above; they cannot be heard to say that this complaint filed is premature.

However, as far as grace period of 6 months is concerned, it was made clear by the opposite parties in clause 4.2 that the said grace period was required for applying and obtaining occupation and completion certificates in respect of the said plot, from the competent authorities. Thus, the said grace period of 6 months was meant for obtaining occupation and completion certificates only and not a grace period for completing the development and offering possession of the said plot. The opposite parties in the present case want to have the cake and eat it too. It clearly shows the high-handedness of the opposite parties towards the poor consumer like the complainant.

Now we will deal with the issue, as to whether, the opposite parties are ready with delivery of possession of plot in question or not. It has been noted by this Commission that the opposite parties in para no. 21 of their written reply (preliminary objections) have very candidly admitted that development work at the project site is at advance stage, though they claimed that it has been completed in major portion of the project. However, except some photographs (most of which pertain to the flats), perusal of which too reveal that still a lot of work is pending to be done at the project site, no other cogent and convincing evidence has been placed on record, to prove that the development is at the advance stage. On the other hand, the complainant has challenged the said photographs, by placing on record the photographs (alongwith rejoinder) of the surroundings of her plot, perusal of which reveals that lot of development work is pending in that area. The site appears to be as good a jungle. Mere placing on record the photographs by the opposite parties, of some other areas of the project in question will not give any help to them, as far as the case of the complainant is concerned.

Infact contrary stands have been taken by the opposite parties in their written reply. In para no. 21 of the preliminary objections, it has been stated that development area in major area of the project has been completed and rest is at advance stage, whereas in the same very paragraph, it has been stated that the competent authorities have given extension for completing the project upto 13.06.2020. Similarly, in para no. 18 of the preliminary objections, it has been submitted by the opposite parties that due to slowdown in the real estate market, the Govt. of Punjab has expended completion period of the project by 31.12.2022 after issuing notification dated 30.01.2020. Surprisingly, in para no. 21 of the preliminary objections itself, it has been stated that the opposite parties have sought extension for completion of the project, which has been granted by the competent authorities. Again, in para no.17 of the preliminary objections, it has been stated that COVID-19 gave a set back to the opposite parties, yet they are trying to complete the project within the extended period. In this manner, contrary stands have been taken by the opposite parties, in their written reply, just to defeat the claim of the complainant.

It may be stated here that the plot had been booked in the year 2012 and now it is July 2021 and still the opposite parties are not sure as to by which date/period possession thereof could be delivered to the complainant. From the perusal of written reply and record attached therewith, it is evident that still they need more time for completing the project. Mere taking a bald ground to the effect that plot is ready for possession and that complainant can be asked to take possession thereof, in the absence of any evidence to the effect that the plot area is habitable, has no value in the eyes of law. Burden to prove that the project has been completed and the area/site, in question, is fully developed or is about to complete, is on the builder/opposite parties. It was so said by the Hon’ble National Commission, in Emaar MGF Land Limited and another Vs. Krishan Chander Chandna, First Appeal No.873 of 2013 decided on 29.09.2014. In the present case, perusal of contents of the written reply filed by the opposite parties, reveal that self-contradictory pleas have been taken with regard to delay in offer of possession of the plot in question to the complainant. Thus, perusal of contents of reply filed by the opposite parties clearly go to show that they were not serious in completing the project wherein the plot in question was sold to the complainant and are now taking bald excuses for causing delay, just with a view to defeat her genuine claim. Under these circumstances, it is held that the opposite parties indulged into unfair trade practice and were also negligent and deficient in providing service to the complainant.

As stated above, still, in the reply filed by the opposite parties, it has been candidly admitted that development work at the project site is not complete but is at advance stage and that application had been moved to the competent authority, seeking extension of time for completion of the project, which has been granted. This candid admission of the opposite parties itself proves that they were not ready with the delivery of possession of the plot even by the committed date or by the date when this complaint was filed and thereafter also. On the other hand, had the development activities been completed at the project site, the opposite parties, could have placed on record copy of the completion certificate, if obtained from the competent authorities, as committed by them, vide Clause 4.2 of the agreement but they failed to do so. As such, an adverse inference could easily be drawn against them that they are not in a position to deliver possession of the plot in question, to the complainant, for dearth of development activities. Under these circumstances, we are of the considered opinion that we cannot make the complainant to wait for an indefinite period, on the whims and fancies of the opposite parties. It is well settled law that non-delivery of possession of plots/units in a developed project by the promised date is a material violation on the part of a builder and in those circumstances, the allottee is well within his/her right to seek refund of the amount paid. It was also so said by the Hon’ble National Commission in Sujay Bharatiya & Anr. Vs. Unitech Reliable Projects Pvt. Ltd., Consumer Case No.1814 of 2017 decided on 05.07.2018. The above view taken is further supported by the principle of law laid down by the Hon’ble Supreme Court of India in the case titled as Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan, Civil Appeal No.12238 of 2018, decided on 02.04.2019 and also in Fortune Infrastructure Versus Trevor D’ Lima & Ors. (2018) 5 SCC 442. In the present case also, since there has been an inordinate delay in the matter, and still the opposite parties are not sure as to by which date development will be completed and possession of the plot will be delivered to the complainant, as such, we are of the considered opinion that if we order refund of the amount paid alongwith interest from the respective dates of deposits that will meet the ends of justice.

At the same time, it is also held that plea taken by the opposite parties to the effect that delay took place in completing the development works at the project site, because it suffered force majeure circumstances i.e. due to COVID-19 the project was hampered; litigation between sand mafia and govt. resulting into shortage of material like sand etc.; delay in approvals by the competent authorities with regard to connections of sewerage and drainage; and recession in the real estate market, does not carry out any weight for the reasons recorded hereinafter.

First coming to delay in approvals on the part of the Govt. Departments, regarding connections of sewerage and drainage, it may be stated here that not even a single letter has been placed on record by the opposite parties showing that they ever reported the competent authorities concerned that there is a delay on their part in granting such sanctions/approvals in respect of the project in question or that any such letter, by which they have given notice to the said authorities that in case the needful is not done in a prescribed time, the Company shall move to the appropriate platform of law, in the matter.

Now coming to the plea regarding shortage of material like sand etc. on account of litigation between the sand mafia and govt., it may be stated here that nothing has been placed on record by the opposite parties to prove that they were unable to procure the said material, in adequate quantity, on account of the alleged litigation. There is no evidence of the opposite parties having invited tenders for supply of material and there being no response to such tenders. A similar plea with regard to shortage of building material as a cause for delay in delivery of possession of the plots/units was taken by a builder before the Hon`ble National Consumer in Consumer Case No.347 of 2014, titled as Swaran Talwar & 2 others v. M/s Unitech Limited (along three connected complaints), decided on 14 Aug 2015, which was rejected and the complaint was allowed in favour of the complainant.

As far as plea taken with regard to COVID-19 is concerned, it may be stated here that the said pandemic took place in India in March 2020, when lockdown was executed. However, lockdown which took place in March 2020 due to COVID-19, has no relation whatsoever, with the inordinate delay in the matter, as the plot in question had been purchased by the complainant as far as back in 2012. Even as per Clause 4.1 of the agreement dated 21.11.2017, possession of the plot was to be delivered to the complainant within a period of 24 months i.e. latest by 28.12.2017 i.e. the date when there was no COVID-19. Even grace period of 6 months also stood lapsed on 28.06.2018, when still there was no COVID-19 and possession of the plot in question was not delivered by the opposite parties. In this view of the matter, no help therefore can be drawn by the opposite parties, in this regard. Thus, in the present case, the opposite parties failed to convince this Commission, that they actually encountered force majeure circumstances (which means irresistible circumstances beyond ones control such like act of God etc.) as a result whereof, delay in handing over possession of the plot occurred. Plea taken by the opposite parties, in this regard, therefore stands rejected.

Now we will deal with the objection taken by the opposite parties to the effect that this complaint needs to be dismissed on the ground that HDFC Limited, from which the complainant has availed housing loan has not been impleaded as a necessary party. It may be stated here that the opposite parties have failed to clarify, as to what prejudice has been caused to them in such a situation. No doubt, housing loan was obtained by the complainant, under the tripartite agreement from HDFC Limited. However, it has been submitted by the complainant in her complaint that the said loan amount stood repaid and to strengthen her stand, she has placed on record NOC issued by the HDFC on 01.06.2016, Annexure C-19, wherein, it has been clearly mentioned that full and final payment has been received from her and nothing is due against her. Thus, we are of the considered opinion that this complaint cannot be rejected solely on the ground that HDFC Limited, has not been made a party to this complaint. Furthermore, irrespective of the fact that the said bank/financial institution has been made party to the complaint or not, this Commission in each and every complaint filed before it, wherein refund is ordered, gives direction to the effect that the bank/financial institution, if any, from which the complainant(s)/ consumer(s) have raised housing loan for payment of installments, shall have the first charge of the amount payable. In this case also, this Commission is going to pass such directions. As such, objection taken in this regard stands rejected.

The opposite parties also cannot wriggle out of their liability, by saying that the complainant defaulted in making remaining payment, in view of principle of law laid down by the Hon’ble Supreme Court of India in Haryana Urban Development Authority Vs. Mrs. Raj Mehta, Appeal (Civil) 5882 of 2002, decided on 24.09.2004, wherein it was held that if the builder is at fault in not delivering possession of the units/plots by the stipulated date or within a reasonable period where no agreement is executed, it cannot expect the allottee(s) to go on paying installments to it. Similar view had also been taken by the Hon’ble National Commission, in Prasad Homes Private Limited Vs. E.Mahender Reddy and Ors., 1 (2009) CPJ 136 (NC), wherein it was held that when development work was not carried out at the site, the payment of further installments was rightly stopped by the purchaser. Thus, in the present case also, if the complainant withheld some part of payment, when she came to know that there was no development at the project site; possession of the plot has also not been offered despite making payment of more than 90% of the basic sale price thereof, she was right in doing so, in view of principle of law laid down by the Hon’ble Supreme Court in Haryana Urban Development Authority (supra). Thus, no help therefore can be drawn by the opposite parties from the letters sent to the complainant asking her to make the remaining payment, in the absence of development works. Plea taken in this regard stands rejected.

An objection was also taken by the opposite parties to the effect that as there was no sale of goods therefore consumer complaint is not maintainable. It may be stated here that because the opposite parties failed to deliver possession of the plot to the complainant till the date of filing of this complaint, as such, it amounts to denial of service on their part, for which the complainant was at liberty to avail remedy by way of filing this consumer complaint. Our this view is supported by the principle of law laid down in Lucknow Development Authority Vs. M.K.Gupta, Civil Appeal No.6237 of 1990, decided on 5.11.1993, wherein the Hon’ble Supreme Court held that where the developer is at fault in not delivering possession of a property, the act so amounts to denial of service and consumer complaint is maintainable before the Consumer Fora.

Now, we will deal with the question, as to what rate of interest should be awarded to the complainant, while ordering refund of amount paid. It may be stated here that compensation cannot be uniform and can best be illustrated by considering cases where possession is being directed to be delivered and cases where only monies are directed to be returned. The party concerned in refund cases is suffering a loss inasmuch as he/she had deposited the money in the hope of getting a flat/plot but he/she is deprived of same; he/she is deprived of the benefit of escalation of the price of that flat/plot; and also he/she would have to take out more money from his pocket for beating the escalation in price, for buying a new flat/plot and as such, compensation to be granted by way of interest on the deposited amount in such cases would necessarily have to be higher. Our this view is supported by the principle of law laid down by the Hon’ble Supreme Court in Ghaziabad Development Authority Vs. Balb

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ir Singh (2004) 5 SCC 65 wherein it was held that in a case where money is being simply returned, the purchaser is suffering a loss in as much as he had deposited the money in the hope of getting a flat/plot and therefore, he has been deprived of the benefit of escalation of the price and the compensation in such cases, therefore, would necessarily have to be higher. Furthermore, a similar question, as to what rate of interest should be granted while ordering refund of the deposited amount, in case, the builder fails to deliver actual physical possession of residential units/plots, fell for determination before the Hon`ble Supreme Court of India in H.U.D.A. Vs. Neelam Sharma, Civil Appeal no.3417 of 2003 decided on 18.08.2004. In the said case, the Hon`ble Supreme Court held that in case of refund of amount, the Interest Act would apply and 12% interest is to be granted from the date of amounts deposited till repayment. The Hon’ble National Commission also, in Alok Kumar Vs. M/s. Golden Peacock Residency Private Limited & Anr., Consumer Case No. 1315 of 2018, decided on 06 Sep 2019 and Anil Kumar Jain & Anr Vs. M/s. Nexgen Infracon Private Limited (A Mahagun Group Company), Consumer Case No. 1605 of 2018, decided on 23rd Dec 2019, awarded interest @12% p.a. to the complainant, on the amounts to be refunded to them from the respective dates of deposits. It is therefore held that in the present case also, if interest @12% p.a. is awarded on the amount to be refunded to the complainant, that will meet the ends of justice. At the same time, it is also held that the opposite parties are not entitled to forfeit any amount, out of the deposited one because it is not the case of the opposite parties that despite the fact that they were ready with delivery of possession of the plot in question by the committed date, complete in all respects with completion certificate, but the complainant want to rescind the contract, on account of some financial constraints, at that stage. As such, plea taken by the opposite parties in this regard stands rejected. The opposite parties have also placed reliance on DLF Homes Developers Limited’s and Wg. Cdr. Arifur Rahman Khan and Aleya Sultana’s cases (supra), to say that since in these cases, the Hon’ble Supreme Court of India has awarded interest @6% p.a., as such, this Commission cannot grant interest beyond that, in the present case also. We do not agree with the contention raised for the reasons recorded hereinafter. It may be stated here that we have gone through the contents of DLF Homes Developers Limited and Wg. Cdr. Arifur Rahman Khan and Aleya Sultana’s cases (supra), and found that the said orders have been passed with regard to compensation for delay in offering possession of the units therein. Since, in the present case, the complainant has sought refund of the amount paid, as such, reliance placed by the opposite parties on DLF Homes Developers Limited and Wg. Cdr. Arifur Rahman Khan and Aleya Sultana’s cases (supra), is misplaced. For the reasons recorded above, this complaint is partly accepted with costs and the opposite parties, jointly and severally, are directed as under:- Refund the amount of Rs.42,25,000/- to the complainant, alongwith compensation by way of interest @12% p.a., without deducting any TDS, from the respective dates of deposit onwards, within a period of 30 days, from the date of receipt of a certified copy of this order, failing which, thereafter, the said amount of Rs.42,25,000/- shall carry 3% penal interest i.e. 15% p.a. (12% p.a. plus (+) 3% p.a.), from the date of passing of this order, till realization. Pay compensation for causing mental agony and physical harassment; deficiency in providing service and adoption of unfair trade practice and also cost of litigation, in lumpsum, to the tune of Rs.50,000/- to the complainant within a period of 30 days from the date of receipt of a certified copy of this order, failing which, the said amount of Rs.50,000/-, shall carry interest @9% p.a. from the date of passing of this order, till realization. However, it is made clear that in case any amount of housing loan is pending to be paid by the complainant to HDFC Limited, it shall have the first charge of the amount payable, to the extent, the same is due to be paid by the complainant. Certified Copies of this order be sent to the parties, free of charge and one copy thereof be also sent to the HDFC Limited. The file be consigned to Record Room, after completion.
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