ORDER

BY SRI.H.R.SRINIVAS, PRESIDENT.

This is the Complaint filed by the Complainant U/S Section 12 of Consumer Protection Act 1986, against the Opposite Party (herein referred in short as O.P) alleging the deficiency in service in not handing over the flat in time and not completing all the work agreed to be carried out and for payment of Rs.48,52,189/- being the interest at 18% p.a., for the delayed period of handing over the possession i.e., from 01.07.2015 to 31.12.2019 and to direct to pay the said interest on the said amount along with Rs.50,000/- as damages for causing inconvenience mental agony, pain and hardship and for other reliefs as the Commission deems fit.

2.      The brief facts of the complaint are that;

The complainant entered into an Agreement of Construction as per clause 16, 5(6) and 5(7) with OP in respect of the project named “Pashmina Water Front”.  According to the agreement, OP is liable to pay interest at 18% p.a., on Rs.59,90,358/- paid towards purchase of the flat from 01.07.2015 to 31.12.2019.  Actual possession of the flat was given to him on 22.08.2019 and allotted flat No. Tower 3, Ground Floor 1, House No.301-B.  There was inordinate delay in handing over the possession of the flat.  Even after possession of the property, there were some uncompleted portion left over in the flat for which OP promised to complete the same within 10 to 15 days time.  Inspite of lapse of 4 to 5 months, the same was not carried out.  Separate individual meter has not been installed to the flat. Hence he had to write a letter on 31.12.2019 calling upon OP to pay interest at 18% on the said amount and also issued a legal notice on 24.01.2020 and a corrigendum on 28.01.2020.  Inspite of it, OP neither paid the interest as agreed nor completed the pending works. Hence there is deficiency in service on the part of OP and hence the complaint.

3.      Upon the service of notice, OP1, 2 and 3 appeared before the Commission and filed version contending that the complaint is not maintainable either in law or on facts. It is filed on frivolous, false, vexatious unsustainable grounds liable to be dismissed in limine. There is no bonafide in the complaint and the material facts have been suppressed by the complainant.  It is admitted by the complainant that possession of the apartment has been handed over and occupancy certificate was also issued by the statutory body pursuant to which the sale deed in respect of the said flat was registered in favour of the complainant upon he remitting the balance of sale consideration and the statutory fees, which indicates that OP has performed it part of contract.  

4.      At no point of time, complainant has issued any notice or letter informing that there is deficiency in service and breach of condition of the terms of the agreement.  The construction and development of the project depends on the timely payment of the amount by the complainant and other buyers of the flat.  Apart from the sale consideration paid as per the payment schedule, the completion of the project also depends upon the other statutory bodies in granting permission from time to time, which was within the knowledge of the complainant.  The value of the apartment property as per the agreement of sale is Rs.27,76,500/- and construction agreement is Rs.33,80,857/- in all Rs.61,57,357/-.

5.      The complainant is seeking Rs.54,41,625/- which amounts to approximately full amount of the cost of the house, on the ground of delay in construction, by seeking interest on the said amount, which goes to show that the complainant wants to get the flat free of cost.  The claim of the complainant as per the contents of the complaint is barred by limitation as complainant ought to have filed within two years from the date of cause of action.  The cause of action for the complaint arose on 01.07.2015.  further complainant cannot seek the protection of the order passed by the Hon’ble Supreme court of India in respect of limitation considering the surmounting situation covid -2019 pandemic since the limitation period expire way back in 2018.

6.      It is further contended that on 24.09.2019 OP executed the sale deed in favour of the complainant and put the complainant in possession of the apartment and at that tie complainant executed Declaration cum Indemnity in favour of OP declaring that he has inspected the apartment unit and he would not approach any authority for any kind of relief and compensation, which specifically implies that the complainant has inspected the apartment unit and satisfy as to the work and further he cannot make any claim from OP from the date of sale.  The complainant got executed the sale deed only after being satisfied about the quality and construction of the apartment unit which infrastructure and facilities now he cannot claim any monitory claim whatsoever against OP. prior to execution of the sale deed.  The claim of the complainant regarding claim of interest for the delayed construction period do not survive at the belated stage and no claim or protest has been lodged by the complainant prior to the execution of the sale deed.  Hence the claim of the complainant is not legitimate and made with an intention of defrauding and to make illegal claim.  The complainant has waived all the claim against the OP by taking possession of the apartment and now cannot file this complaint. 

7.      It is contended that on and from the date he has been carrying out interior works independently.

8.      The complainant has not approached the Hon’ble Commission with clean hands and has suppressed the material facts, with a sole intention to get unlawful enrichment. The complainant was bound by the payment schedule set out in the construction agreement and agreement to sell. That was executed between the parties. Complainant has not made the payments as per the payment schedule and there is delay in making the said payment for which an interest at 18% p.a., would attract as per clause 5.6 and 5.7 of the construction agreement.  The delay in making the payment by the complainant and not adhering to the schedule of payments resulting delay in obtaining the Occupancy Certificate from BBMP.  Inspite of severe problems from various quarters OP completed the project and obtained the Occupancy certificate on 29.06.2019 i.e., within 3 months from the date of execution of the sale deed, which clearly shows that the complainant is not entitled in the alleged claims set out in the complaint.

9.      It is further contended that there is no deficiency in service on the part of OP and the delay in handing over the possession cannot be solely attributable to the OP as the same can be attributable to the statutory bodies sanctioning the license, plan, modified plan which did not happen in time, event of force majure where time was last in excavating hard granite rocks to commence lying of foundation for the construction of the building and towers and due to heavy rains and harsh weather and late payment from the prospective purchasers, shortage of sand due to the ban by the government of Karnataka and direct to use M-sand and shortage of M-sand and difficulty in procuring the same construction delays attributable to the contractors event of d-monetization, protest and strike by various organization against social and political issues, shortage of raw materials due to implementation of GST and non-availability of the labours. Inspite of all these hindrances, problems and the increase in the cost of raw materials, OP did not escalate the cost and demanded the same over the agreed amount as per the agreement.  There was also delay in obtaining RERA registration certificate.  The time for completion of the construction of the project as per the RERA was 31.12.2018.  Further extension was considered by the authority and immediately on completion of the project OP applied for occupancy certificate on 11.09.2018 but the authorities delayed and issued the same on 29.06.2019. Hence OP is not liable to pay the compensation for the days of delay passed by the authorities which was beyond the control and the same is agreed between them as per clause 6.1 and 6.2 of the construction agreement. 

10.    Further it is contended that there was high tension electrical line, passing through the land on which the project was to be developed. By order dated 20.09.2010 obtained permission from KPTCL to shift the said line, which was challenged by way of writ petition by the adjoining layout welfare association i.e., RIFO Shanthinikethan owners association.  Due to the said legal proceedings the shifting of the high tension wire could not be accomplished within the reasonable time and only accomplished after the said writ petition was disposed on 23.10.2017 and hence there was a delay. Further the National Green Tribunal by order dated 07.05.2015 directed that the buffer zone in respect of lakes to be extended to 75 meters from the existed buffer zone of 30 meters.  Since the project undertaken by the OP was being developed on a land abating to the lake got affected.  Further the BBMP issued a circular to the effect that building that fell under the extended buffer zone could not be granted occupancy certificate for which application was filed by OP on 11.09.2018 and the same was refused. The uncertainty also led to the final developmental work getting slow down.  Till the Hon’ble Supreme Court of India passed the judgement against the order of National Green Tribunal on 05.03.2019 there was uncertainty about granting of occupancy certificate despite major work being completed prior to 04.05.2016.  Due to said uncertainty OP had to invest all energy, money in following up the appeal pending before the Supreme Court, as the bearing of the order bears the viability and legality of the project and on 5.3.2019 the Hon’ble Supreme Court the order of National Tribunal extending the buffer zone. 

11.    Further the complainant has not suffered any loss arising out of non-installation the electricity meter. Not even a single rupee has been paid by the complainant in that respect.  OP applied to BESCOM for electricity connection to the entire project and to the individual apartments.  There are number of procedures to be followed to obtain the power from BESCOM.  However in order to provide electricity to the buyers OP made temporary arrangements by installing diesel generators. He has issued a reply to the notice and to the corrigendum issued by the complainant refusing all the allegations made against it and also with proper explanation.  There is no bonafide on the part of the complainant in filing the complaint and it is only a route made to recover the entire sale consideration paid by him towards the cost of the flat. Denying all the allegations made in each and every para of the complaint OP prayed the commission to dismiss the complaint.

12.    In order to prove the case, complainant got himself examined as PW1 and got marked nine documents on his behalf. OP inspite of getting several opportunities did not adduce evidence and hence this Commission considered that there is no evidence to be adduced and close the case of the complainant. Arguments Heard. The following points arise for our consideration:-

1) Whether the complainant has proved deficiency in service on the part of the Opposite Parties?

2) Whether the complainant is entitled to the relief prayed for in the complaint?

13.   Our answers to the above points are:-

POINT NO.1:            In the Affirmative

POINT NO.2:            Partly in the affirmative.

                                For the following.

REASONS

14.   POINT No.1:-

   Perused the complaint, version, affidavit evidence and the documents produced by respective parties.  It is not in dispute that the complainant entered into with an agreement of purchase and Agreement of Construction with OP which is evident from the documents produced i.e., Ex P1 and P2.  As per the contents of the said agreement, clause 5.1 deals with regarding to forfeiture of the amount to the extent of 10% out of the amount stipulated for construction in case of termination of the agreement and seeking refund of the balance amount.   It also deals with clause 5.7 stipulates that 18% p.a., interest will be levied to the purchaser in case there is delay in paying the amount as stipulated in the agreement (stagewise).  For the better understanding the contents of clause 5 and 6.1 and 6.3 have been reproduced here

5.1)       The First party has/have paid the second party the amount as mentioned I schedule ‘D’ hereto as part payment towards cost of construction of schedule ‘C’ apartment and balance cost shall be payable to the second party as detailed in schedule herein.  Payment in terms of schedule ‘D’ herein is essence of this agreement and under no circumstances there shall be delay or default inpayment of the balance cost construction.  All payments as per schedule ‘D’ shall be made by the first party second party without there being any necessity of any demand as and when it is.  In case any cheque/s issued by the purchaser/s is/are dishonored for any reason respect of the payments in schedule ‘D’ hereto, the purchaser/s is/are not only liable lawful action, but also be liable to pay the charges collected by the bank.

5.2)       In the event of delay/default by the first party to pay the balance cost of construction as schedule ‘D’ hereto and aforesaid taxes, the second party shall be entitled to terminate this agreement by issuing a notice calling upon the first party to pay the arrears of amount due, taxes and other levies due, if any, within 30 days from the date of issue of such not and if the first party fail/s to pay the same, this agreement shall be deemed to have been terminated after forfeiture of 10% of cost of construction stipulated herein as liquidate damages.

5.3)       In the event of termination as aforesaid, the second party inspite of arbitration, shall entitled to recover from the first party 10% of the total cost of construction resend herein as liquidated damages by adjusting the same against the amounts paid by first party till the date of termination and refund the balance, if any, within one month from the date of termination of this agreement.  On such termination the agreement of sell entered into between the parties hereto and land owners stand termination automatically without further notice to the first party.

5.4)       In case of violation of the terms in the agreement to sell by the first party the terms in agreement shall be deemed to have been violated and hence stand termination automatically without notice and consequences of termination as detailed in the sale agreement shall be applicable.

5.5)       Upon termination of this Agreement the first party shall not have any claim over the schedule ‘B’ property and ‘C’ apartment and/or second party and/or agreement to sell.  The second party shall be entitled to deal with third parties schedule property and ‘C’ apartment as they may deem fit for their  benefit without reference to the party.

5.6)       If however, the first party pays up the arrears within the time stipulated in the notice of termination with overdue interest at 17% per annum, the right to terminate the agreement would lapse for such default and this agreement continues to be valid.  

5.7)       However even after the expiry of stipulated notice period as mentioned above-the second party at their discretion may agree to receive the unpaid sums with interest at 18% per annum from due date till repayment in full and in one lump sum of all the outstanding dues.

5.8)       In case the first party cancel/s this agreement, the second party is entitle to forfeit from the amounts paid/recover the amounts from the first party equivalent to 10% of the cost of construction stipulated herein as liquidated damages and refund the balance sum due if any under this Agreement within one month from thedate of re-sale/transfer of schedule ‘B’ property to third party/ies and such forfeiture/recovery as aforesaid by the second party shall be automatic without further notice on the first party cancelling this agreement as aforesaid.

6.1)       The possession of the schedule ‘C’ apartment in schedule ‘A’ property will be delivered by the second party to the first party on or before 30^th June 2015 with six months grace period additionally, and subject to clause No.6.2 as mentioned below.  Though every effort will be made to obtain electrical, water and sewerage connections within the stipulated time, no responsibility will beaccepted by the second party for delays’ in obtaining such connections, clearances, occupancy and other certificates from the statutory authorities and first party shall not be entitled to claim any damage/losses/interest against the second party on the ground of such delay.  If there is delay in securing permanent connections, temporary connections will be provided till permanent connections are provided.  The first party shall however pay the consumption charges as per bills raised.  The second party has taken NOC for water and sewerage from BWSSB.  If water supply from BWSSB is either inadequate or unavailable then the same shall be procured through alternative sources and the proportionate cost for the same shall be borne by the first party.  The certificate issued by the project architect appointed by sellers for the development in schedule ‘A’ property as to the completion of the apartment and its fitness for occupation shall be final and binding on the parties notwithstanding the fact whether the occupancy certificate from the plan sanctioning authorities is issued or not.

6.3)       In case of delay in delivery of the apartment for reasons other than what is stated above, the second party is entitled to a grace period of six months and if the delay persists, the second party shall pay the first party damages at Rs.10/- per sq. feet of saleable area per month of delay of the schedule ‘C’ apartment till delivery, provided the first party has/have paid all the amounts payable as per this agreement and within the stipulated period and has not violated any of the terms of this agreement and Agreement to sell.  However, if the delay is on account of first party seeking modifications in schedule ‘C’ Agreement there is no liability on the second party to pay any damages as aforesaid.

        15.   It is also not in dispute that as per the delivery schedule mentioned in Ex.P1 and P2, OP agreed to fully construct and deliver the flat on or before 30^th June 2015 with six months grace period additionally, subject to clause 6.2 of the agreement, which has been reproduced above which means that by the end of December 2015, OP ought to have delivered the possession of the flat as agreed to the complainant, whereas the sale deed produced marked as Ex.P3, clearly shows that the same was executed on 24.09.2019 and possession was handed over to the complainant.  Notice has been issued by the complainant to OP claiming interest at 18% on the amount paid towards sale consideration, which is marked as Ex.P4 and P5, which has been received by OP and a corrigendum has also been issued to OP stating that “at the time of handing over the possession of the flat by executing the sale deed individual electric meter has not been installed.” A reply is also been given to the notice and the corrigendum as per Ex.P9, wherein it has stated that there is gross delay on the part of the complainant in paying the sale consideration which was clarified to the complainant and hence he is not entitled for delay compensation and then only they have agreed to register the flat in the name of the complainant  and at the time of handing over the key the client has executed a declaration cum indemnity bond declaring that he inspected the unit and would not approach any court or authority for any kind of relief of compensation.   With respect to separate electric meter to be installed to each of the flats is concerned, they have already applied to the BESCOM authorities to provide individual meter to the flat and the matter is under process and till then, they have provided electricity by diesel generator set to each and every apartment and they will be following the progress with the authorities.  

16.   From the above, it becomes clear that there is a violation of the time in handing over the possession of the flat to the complainant by OP.  As per the agreement above, there is a delay of nearly 45 months as on the date of registration presuming that, the same was handed over on the date of registration. For which, as per clause 6.1, OP has to pay Rs.10/- per sq. feet of the saleable area i.e., 1888 sq. feet., which amounts to Rs.18,880/- pm., X 45 months = Rs.8,49,600/- as delay compensation.

17.   OP has relied on clause of 6.2 of the agreement of construction and the Sale Agreement, wherein OP has contended that due to various facts and circumstances, beyond control could not complete the construction of the house. OP has explained the circumstances under which the delay has caused. OP has also cited the litigation by a neighbor RIFCO Shanthinikethan layout in respect of getting electricity, high tension line of 400 KV, DC line and SC line o 220 KV shifted.  The said writ petition is during the year 2013 and also filed copy of the order passed by National Green Tribunal, Principal Bench, New Delhi in OA 222/2014 and also the order of the Hon’ble Supreme Court of India in Civil Appeal No.5016/2016 disposed on March 5^th 2019.  The earlier judgments and the litigations were even prior to the OP entering into the agreement in respect of the sale of the flat with the complainant. 

18.   When such being the case it ought not to have committed itself to the time frame and should have clearly mentioned that after clearing all the hurdles it would fix the date for completion of the project and the date of handing over the same. As per clause 6.1 it agreed to hand over the possession of the constructed flat by the end of December 2015 including grace period of six months. On what authority or reason OP committed the time line when it knew very well the pending litigation and also not knowing when the litigation comes to an end.  Further no materials have been placed except the copy of the order passed by the Hon’ble High Court of Karnataka, the NGT and the Supreme Court of India, against the order of NGT to amplify the reason given in the version as well as the reason for not completing the construction of the building and that it is not bound to pay delay compensation for the delayed handing over of the possession.  

19.   No document worth believing to show that there was a labour unrest, labour strike, strike from lorry owners, shortage of steel, sand and building materials, force majeure like, floods, earthquake and other things.  Though it has taken up the above contention and including demonetization how it has effected has not been placed before the commission, to consider whether the delay on the part of the OP in completing the construction and handing over the completed flat to the complainant in time is genuine and the reason given is justifiable.  Under the circumstances, as there is a delay of nearly 45 months, we hold that there is deficiency in service in handing over the possession of the flat and answer point No.1 in the affirmative.

20.   Further as admitted by OP itself, still even on the date of filing of the complaint, no individual meter has been provided to each flat of the purchaser, which also amounts to deficiency in service. However OP has contended that it has provided diesel generating set to provide required electricity to the each flat owners, which has not been denied by the complainant and hence even assuming for the movement that there is deficiency in service in that respect, the same has not affected the day to day life of the complainant and thereby has not suffered physically, mentally or financially.  

21.   It is the contention of the OP that at the time of getting the sale deed registered, has executed an Indemnity Bond and agreed that he will not claim any compensation for deficiency in the flats that may be noticed.  This Indemnity bond, itself is violative of the general law and oppose to public policy.  It is to be considered here that OP is in a dominant position and in driving seat. Whereas in case the complainant did not affix the signature to the indemnity bond, to us, it appears that there was every likelihood of OP not executing the sale deed and thereby putting the complainant to a worse situation, wherein he would have lost his money and also the flat. Under these circumstances, the complainant had to execute the indemnity bond stating that he will not make any claim for compensation which is much against to the public policy and the rights conferred under various acts and rules. Hence even assuming for the moment that indemnity bond in existence, it has no sanctity of law.  Hence we answer point No.1 in the affirmative.

22.   POINT NO.2

In the result as discussed above, OP had agreed to pay 10% as delayed compensation per month on the saleable area i.e., 1888 sq. feet, which amounts to Rs.18,880/- and for 45 months delay in handing over the possession of the house, is Rs.8,49,600/- for which complainant is entitled to get the amount from OP and OP is bound to pay the said amount.  Though it is contended by OP that the said clause is applicable in case the owner has paid all the amount as per the schedule mentioned in the agreement of sale/construction agreement, and as in this case, the complainant has defaulted in paying the amount as per the time schedule, complainant is not entitled for the said relief of delayed compensation.  We have to observe here that no materials have been placed by OP regarding delayed payment by the complainant, so as to deny him the fruits of delayed compensation.  The act of OP in delaying the construction of the flats, and handing over the same naturally put the complainant into mental agony, strain, physical hardship, and also financial hardship, which OP is bound to compensate by paying the delayed compensation of Rs.8,49,600/- along with interest at 12% p.a., from the date of execution of the sale deed along with damages of Rs.1,00,000/-.

23.   Further the act of OP made the complainant to approach this commission by engaging an advocate to prepare the brief and to conduct the case for which complainant has spent time, money and energy for which we direct OP to pay a sum of Rs.15,000/- towards litigation expenses.

24.   Complainant has sought 18% interest on the amount he has paid towards the consideration amount as compensation and further prayed the Commission to direct OP to pay a sum of Rs.48,52,184/- on the ground that there are so many decisions rendered by the Hon’ble Supreme Court of India, wherein when OP has mentioned and demanded 18% interest on the balance of sale consideration to be paid, the same amount of interest on the sale consideration has to be ordered to be paid by the complainant.  Inspite of it the counsel or the complainant has not produced such a decision for consideration by this Commission. 

25.   On the other hand, as per clause 5 it is specifically mentioned that in case of delayed payment by the complainant, OP can insist for interest at 18% p.a., on the outstanding balance to be paid towards sale consideration in case it did not go in for forfeiture clause and cancellation of the sale agreement.   Argument of the complainant would have been accepted had there been no clause of delayed compensation as per clause 6.1, wherein it has been clearly mentioned that OP has to pay 10% as delayed compensation in case there is a delay in construction of the flat and handing over the same on the saleable area. In case there is delay in handing over the possession. Hence the contention of the complainant that he is entitled for 18% interest on the sale consideration and for Rs.48,52,184/- cannot be accepted.  Under the circumstances, we answer point No.2 partly in the affirmative and pass the following;

ORDER

1. Complaint is allowed in part with cost.
2. OP is directed to pay Rs.8,49,600/- to the complainant along with interest at 12% p.a., on the said amount from the date of execution of the sale deed till the date of payment.
3. OPPOSITE PARTY is further directed to pay a sum of Rs.1,00,000/- towards damages and Rs.15,000/- towards litigation expenses to the complainant.
4. OP is further directed comply the above order within 30 days from the date of receipt of this order and submit the compliance report to this forum within 15 days thereafter.
5. Send a copy of this order to both parties free of cost.

Note:You are hereby directed to take back the extra copies of the Complaints/version, documents and records filed by you within one month from the date of receipt of this order failing which the same will be weeded out/destroyed.

(Dictated to the Stenographer over the computer, typed by him, corrected and then pronounced by us in the Open Forum on this 22^ND DAY OF FEBRUARY 2022)

MEMBER                                PRESIDENT

ANNEXURES

1. Witness examined on behalf of the Complainant/s by way of affidavit:

Copies of Documents produced on behalf of Complainant/s:

Ex P1: The construction Agreement and the Sale Agreement

Ex P2: Copy of the sale deed

Ex. P3: Letter written by me dated 31.12.2019 to OP

Ex P4: Copy of the legal notice

Ex P5: Postal acknowledgement

Es P6: Corrigendum issued

Ex P7: Postal acknowledgement

Ex P8: Reply given by OPPOSITE PARTY to the legal notice

2. Witness examined on behalf of the Opposite party/s by way of affidavit:

• NIL -

Copies of Documents produced on behalf of Opposite Party/s

• NIL –

MEMBER                                        PRESIDENT

HAV*