ORDER

BY SRI.H.R.SRINIVAS, PRESIDENT.

1.     This is the Complaint filed by the Complainant U/S Section 12 of Consumer Protection Act 1986, against the Opposite Parties (herein referred in short as O.Ps) alleging the deficiency in service in not handing over the land agreed to be sold with developments and further not refunding the consideration amount paid inspite of not developing the land as agreed, and for refund of Rs.5,50,000/- paid towards consideration amount along with bank rate of interest and 2% surcharge as per the terms of the agreement from 2015 and Rs.5,00,000/- as compensation for causing mental agony, physical harassment and financial loss and Rs.25,000/- towards cost of litigation and for other reliefs as the Commission deems fit.

2.     The brief facts of the complaint are that; OP-4 offered a piece of land measuring 1 acre of land bearing No. Plot No.47 at ‘MRITSA PROJECT’ located at Kusgaon Village, Raigad District of Maharashtra State of Rs.5,50,000/- in the year 2010.  An agreement was entered on 07.12.2010 wherein the OPs agreed to complete the project and handover the same within 60 months from the date of the agreement for which complainant had paid Rs.1,00,000/- as booking advance and Rs.7,500/- as first installment payment and the remaining amount in 59 EMI’s of Rs.7,500 each. It was agreed to refund the entire amount paid  by the purchaser along with accrued interest at the existing bank rate interest with addition 2% surcharge. If there is any delay on the part of OPs in developing and handing over the plot to the complainant due to governmental restrictions or circumstances beyond its control. During December 2015, complainant visited the OP-4 office and requested for the schedule time for handing over the land and its registration. He was asked to contact the relationship manager OP-2.  Afterwards he visited the Bangalore Registered office and was shown some photographs of the site and told that the project  is getting delayed due to government approval and further assured that registration will happen in the year 2017. 

3.     Again he visited the office at Bangalore after 6 months and again he was told to wait for some more time. He was not allowed to meet the vice president one Mr.Amit Kumar. He tried to contact OP2 and 3 but they also did not respond to his calls.  After long discussion he was offered an alternate property in other project and the details was shared with him.   He found the said offer as beyond his financial reach and could not accept the same and sought for refund of the amount paid by him and also the interest as agreed in para 4 and 5 of the sale agreement. Inspite of this they did not refund the amount nor handed over the property agreed and hence he had to issue a legal notice which was replied at a later date.  Inspite of paying the entire sale consideration OP has not developed the project and handed over the property as agreed upon in the sale agreement. Hence there is deficiency in service on the part of OP. Further non-refunding of the sale consideration given, amounts to unfair trade and prayed the commission to allow the complaint.

4.     Upon the service of notice, OP-4 appeared before the forum through his advocate, whereas OP-1, 2 and 3 remained absent and placed exparte. Afterwards OP-1 and 2 filed application under order IX rule 7 CPC seeking to set aside the order keeping them exparte and the same was allowed.  Version of OP-1, 2 and 4 have been filed separately.

5.     In the version filed by OP-1 it is contended that the complaint is not maintainable either in law or on facts liable to be dismissed and the complainant to prove strictly the allegations made against it. It is further contended that OP-1 is the Chairman cum Managing Director of EXPAT properties– I Limited which is a company and not a party to the contract.  The complainant has preferred the present complaint against OP-4 which is a company having a separate distinct entity of its own and legal existence of its own, from that of Expat Properties (I) Limited (OP-1) hence this complaint is not maintainable against the OP-1.

6.     Further the transaction has been carried out between complainant and OP-4 as per the token receipt agreement issued on 07.12.2010.  Hence it is a transaction between complainant and OP-4 and OP-1 has nothing to do with the said transaction. Hence this complaint is not maintainable.  Even for arguments sake that OP No.1 is a director of Expat properties liable in the present case,  a director cannot be held individually and if any claim is to be made, it is only against the Expat Projects and Development Pvt. Ltd., (OP-4) which is a company having a legal personality which can be sue or sued.  Since OP-1 is the CMD of the Expat Properties (I) limited, he cannot be held liable in his individual capacity.  Further the complainant do not reveal any allegations or involvement of OP-1. Hence this complaint is bad for mis-joinder of parties and hence prayed to dismiss the complaint against it.

7.     In the version filed by OP-2 it is contended that the complaint is not maintainable either in law or on facts and he is only an employee and authorized signatory of oP-4 i.e. M/s Expat projects and developments Pvt. Ltd and further there is no allegations made against OP-2 in the complaint.  OP-2 and OP-4 are distinct and separate entities. OP-2 is only an employee and OP-4 is the company. Hence there is misjoinder of parties and the complaint is liable to be dismissed on that ground.  OP-2 is not at all responsible for any of the transactions by the complainant with OP-4.  Further no relief has been claimed against OP-2. Hence there is no cause of action against OP-2.  OP-2 is not at all involved in the present transaction in his personal capacity.  His involvement is only in the capacity of an employee of OP-4 as per the token receipt agreement issued. Expat Projects and Developments Pvt. Ltd (OP 4) is a separate juristic entity and identity is sufferable from its employees and authorized signatory.  Hence no liability can be fastened to OP-2 and hence prayed the commission to dismiss the complaint.

8.     In the version filed by OP-4, it is contended that, the complaint is liable to be dismissed as it is filed without valid and tenable grounds.  Further the property is situated is an agricultural land measuring 1 acre at “MRISTA PROJECTS” located at Kusgaon Village, Raigad district, Maharashtra. Complainant after meeting the representative of OP-4, and doing due diligence, decided to invest in the present project towards a layout which is an agricultural plot, which OP was intended to develop.  The amount payable was Rs.5,50,000/- for the said property and an advance of Rs.1,07,500/- was paid out of the total consideration as booking amount. The remaining Rs.4,42,500/- was to be paid to the OP-4, in the course 5 years at the rate of Rs.7,500/- per month for 59 months.  

9.     It is contended that, Complainant has suppressed the material fact that he has paid only Rs.5,05,000/- and an outstanding amount of Rs.45,000/- i.e. 6 installments were still due he failed to pay the said 6 installments. One who approaches court must come with clean hands. The complainant is in fault in not paying the entire sale consideration. Further the token receipt cum agreement entered into on 07.12.2010 states at Para 4 that penalty of Rs.1,000/- to be imposed at the first instance of failure to make the payment through ECS. At para 5, the applicable penalties have been mentioned for failure to pay further ECS. If there is a failure of making payment over 4 months the contract would be terminated and the plot would be put for resale. Consequent to termination a fee of Rs.50,000/- or 10% of the amount paid whichever is higher would be deducted from the payment received and the remaining amount to be refunded within 90 days from the date of resale of the said plot. 

10.   From the details of the payments made by the complainant, there is short payment 45,000/- and thus the complainant has defaulted himself.  In the light of the same, the present contract ought to have been terminated and the plot ought to have been put to resale.  Complainant is taking undue advantage of the same. As per para 10 of the agreement, the property should be registered within 60 months, only after receipt of the full payment including the registration charges and applicable stamp duty. Since the complainant failed to pay the full amount of sale consideration, the registration was not done in his favour. Further he has not adhere to the terms and conditions of the agreement. He himself has breached the contract of agreement.  Further he has made a false claim of having paid Rs.5,50,000/- whereas he has paid only Rs.5,05,000/- only.   Complainant has no cause of action against OP-1, 2 and 3 as OP-1 is the chief managing director of Expat Properties India Limited which is altogether a separate entity and he cannot be made liable. 

11.   Further OP 2 and 3 are its (OP-4) employees OP-2 is the vice president of the project and OP-3 is the relationship manager. They are executing their duty as employees and no claim can made against them, since they are executing the work as employees.  They cannot be held responsible and there is no cause of action lies against them. Further at para 7 of the agreement it is stipulated that OP-4 shall refund the amount paid subject to the written request sent to OP, wherein, it shall deduct Rs.30,000/- or 5% of the total consideration as processing fee for cancellation,  that too subject to resale of the property within 90 days.  Complainant had given consent to the refund procedure at the time of executing the agreement.  Hence the claim made by the complainant for refund of Rs.5,50,000/- is against to the terms and conditions of the agreement. The complainant is taking complete advantage of the situation to make illegal gains.

12.   Further the complaint is barred by limitation as, as per the agreement the plot ought to have been delivered within 5 years from 07.12.2015. Since the dispute arose on 07.12.2015 as per the provisions of the Consumer Protection Act, complaint ought to have been filed within 2 years from that date. Hence the complaint filed is barred by limitation and liable to be dismissed. The legal notice issued by the complainant is not proper and invalid and not in accordance with law.  The complainant do not fall under the ambit of Consumer Protection Act. The complainant was going to purchase agricultural property without any agricultural pahani/patta which is prohibited under Maharashtra Land Reforms Act and he was restricted from purchasing the agricultural land from the very inception and therefore cannot seek the benefit a transaction. He could not enter into in the first place and cannot take advantage of his own lapses.

13.   The non-allotment of the plot was due to the fact that whole amount was not paid by the complainant and in addition to, not providing the required agricultural certificate for the agricultural property and further the agricultural plot do not fall within the definition of the service as defined under Section 2(42) of the Consumer Protection Act and hence it cannot be called as deficiency in service.  

14.   This complaint is preferred by the complainant as a money recovery process which amounts to pressure tactics and to expedite the illegal claims.  The present claim is of money recovery suit which ought to have been filed before the Civil Court.  The complaint is in contravention of the terms and conditions of the agreement. 

15.   OP-4 offered a swap deal in order to make good the lapse on its part. That numerous emails were sent to the complainant offering swap choices, whereas he failed to accept the same.  OP also made several attempts to make good its lapses. Whereas, the complainant never accepted the options and was firm on staying with the present project.  Denying all the allegations made in each and every para of the complaint, OP prayed the Commission to dismiss the complaint. 

16.   In order to prove the case, both the parties filed their affidavit evidence and produced documents. 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?

17.   Our answers to the above points are:-

POINT NO.1:            In the Affirmative

POINT NO.2:            Partly in the Affirmative.

                                For the following.

REASONS

POINT No.1:-

18.   Perused the complaint, version, affidavit evidence and the documents produced by respective parties. It is not in dispute that the complainant approached OP-2, 3 & 4 for purchase of a developed agricultural land measuring 1 acre and it is also an admitted fact the complainant paid a sum of Rs.1,07,500/- on the day of agreement out of which Rs.1,00,000/- is towards the booking advance and Rs.7,500/- is being the first installment out of 60 EMI’s and that the balance of the amount to be paid @ Rs.7,500 per month for 59 months.  It is an admitted fact by the OP-4 that they entered into an agreement wherein they have agreed to get the sale deed registered and put in possession of the property within 60 months from the date of payment, failing which agreed to refund the amount with bank interest prevailing at that time and further 2% surcharge on the said amount. 

19.   According OP-4 though the agreement was executed between OP-4 and the complainant, the complainant did not pay the full amount whereas he has only paid Rs.5,05,000/- and did not comply with the terms and conditions of the agreement and further from 2015 onwards within two years, he ought to have filed the complaint before this commission whereas he has filed this complaint in the year 2020 and the complaint is barred by limitation. Further the agreement stipulates that in case of cancellation of the booking Rs.30,000/- or 5% of the total sale consideration would be deducted and the remaining amount would be paid within 90 days from the date of resale. 

20.   OP has also taken the defense that the complainant ought to have provided agricultural pahani / patta in order to purchase an agricultural land as per the prevailing law i.e. Maharashtra Land Reforms Act.

21.   With this background we have to analyze as to what is the deficiency in service on the part of OP. On perusing the agreement of sale between the complainant and OP, there is no mention of OP demanding and putting a condition precedent that the purchaser should be an agriculturist and that he should have pahani/patta in order to purchase the said property.  In the agreement itself it is clear that the development shall be completed within 60 months from the date of executing the agreement that means from 07.12.2010 within 5 years i.e. 07.12.2015 OP-4 ought to have developed the plot and handover the same to the complainant.  

22.   It is also mentioned therein that in case of delay in the development by the developer beyond the extended period, the developer undertakes to pay interest on the consideration paid by the purchaser till the completion of the project at the then existing bank rate of interest plus additional 2% surcharge or with the developer agrees to refund the entire amount paid by the purchaser along with accrued interest at the existing bank rate or alternately allot another plot to the purchaser in any of the properties or developments promoted by the developers or its nominee in India with a prior consent of the purchaser.

23.   If developer is unable to develop the plot due to governmental restrictions or circumstances beyond their control the developer agrees to refund the entire amount paid by the purchaser along with accrued interest at existing bank rate or alternatively allot another plot to the purchaser in any of the properties/ developments promoted by developer or its nominee with the prior consent of the purchaser.  It is also mentioned in the agreement that he has received Rs.107,500/- and the balance of Rs.4,42,500/- in monthly installments commencing from June 2011 ending with April 2016.  It is also mentioned there in that purchaser shall bear the cost of electricity, water, conversion charges and cost of obtaining any post registration document like khatha 7/12 extract, or patta will also be chargeable at rate specified by the developer. 

24.   In the said agreement it is also mentioned that the scheme mentioned as MRITSA for development of project by proposing a layout with agricultural plot as per plan prepared by them with barbed wire fencing electricity and water to the plot area with internal access motorable road leading to the said plot. When this is taken into consideration it is clear that the developer OP-4 wanted to develop the plot and sell it to the complainant and such other person who come forward to purchase the same and it is no more an agricultural land to be sold as it is in favour of the purchaser.  OP-4 wanted to sell a developed plot.  Further in the reply to the notice dated:27.02.2019, 05.03.2019 and 11.11.2019  Op-4 has replied that it has not received the full consideration to the said plot. Hence they are not liable to register the said land. Further it is also mentioned that “despite facing access issues to the land on which the said project is to be developed due to which our client have been unable to complete the developmental activity of the said project.  Our clients are keen on keeping the interest and investment of your client at top priority and help your client to re-benefit of his patience.  Complainant has not accepted the alternate property offered by the complainant.”

25.   From the very reply to the notice it is clear that there was an access issue to the land on which the project is to be developed and that is why OP-4 is unable to complete the developmental activity. When such being the case, how can OP seek for an equity with the complainant and to raise the contention that the terms and conditions of the cancellation is applicable and that he is entitle to deduct the amount as per the terms and conditions of the agreement.  The complainant has produced the receipt for having paid Rs.45,000/- towards the payment of the total consideration. The receipt is produced which is dated 28.05.2020.

26.   In view of the OP not developing the plot even after 60 months from the date of agreement and even after six years from that date also, it becomes clear that there is deficiency in service on the part of OP. Many of the decisions of the Hon’ble Supreme Court of India and the Hon’ble NCDRC are to the effect that the purchaser cannot wait forever or indefinitely to complete the project by the developer and go on waiting for the registration and possession of the property.  It is the bounden duty of the developer to develop the plot or to construct the flat well within the time agreed.  When the same is not done according to the various judgments of the Supreme Court of India it gives raise to continuous cause of action. It is held in Hon’ble National Consumer disputes Commission – 2022(2) CPR 98 (NC) – Mamata Maurya and ors Vs Jai Prakash Associates Ltd and Ors. held:

“(A) Consumer Protection Act, 1986 – S.12(1) (a) [Consumer Protection Act, 2019 – S.35(1) (a)] – Services –Real Estate – Complaint filed alleging deficiency in service in not handing over the possession of the Units within stipulated period and seeking either possession with delayed compensation or refund of amount deposited by them along with reasonable interest and compensation  - whether the plea that some of the complainants defaulted in making timely payment as per payment plan chosen by them, which ceased them to file the present complaint, if can be contented – OP Builder could have exercised options available under the Standard Terms and conditions of the Application Form either to cancel the Agreement or charge delay interest. The OP Builder cannot take shelter under the lame excuse that the Complainant defaulted in making payment which ceased them to file the present complaint.

(B) Consumer Protection Act, 186 – S.12(1) (a) [Consumer Protection Act, 2019 –S.35(1) (a) ] – Services – Real estate –Whether contention of the OP Developer that they have closed the Allotment of some of the Complainants on their request of cancellation, can be sustained and deficiency of service can be attributed on OP’s – If the amounts deposited by the said Complainants are not refunded, it is a clear case of deficiency in service on the part of the OP Developer because after accepting the request of cancellation the OP Developer cannot sleep over the matter for a long time. It is the duty and responsibility of the OP Developer to refund the amount to the said Complainants within a reasonable time – In the instant case, when the Project has not taken off, the Op Developer is duty bound to refund the amount to the said Complainants along with appropriate interest.

(C) Consumer Protection Act, 1986 – S.12(1) (a) [Consumer Protection Act, 2019 – S.35(1) (a) – Services – Real Estate – Complaint filed alleging deficiency in service in not handing over the possession of the Units within stipulated period and seeking either possession with delayed compensation or refund of amount deposited by them along with reasonable interest and compensation – Complainants cannot be made to wait indefinitely for possession of the Units. As a period of more than 12 years has lapsed from the date of allotment and the Project is still incomplete, therefore, the Complainants are entitled for refund of the respective deposited amount along with reasonable interest – OP Developer is directed to refund the entire deposited amount to the respective Complainants along with interest @ 9% p.a. from the respective date of deposit till the date of payment within a period of 3 months, Complaints partly allowed.”

27.   In view of this there is no material placed by OP-4 that it has developed the plot and ready for registration. It would have intimated in writing the complainant to do all the formalities required for registration and get the land registered in his name. The same has not been done. Even OP-4 has not exercised the option available under the agreement if at all there was breach of terms by the complainant.

28.   Further if at all complainant has not paid the full consideration amount of Rs.5,50,000/-, what prevented OP.4 to demand the complainant to pay the balance of sale consideration or in case of default of paying the sale consideration to exercise its right accrued under the terms and conditions of the agreement – Para 5 regarding payment terms and non-payment of ECS mandatory payment. It has not taken any steps in that manner. 

29.   The person who seeks equity should show that equity has been done on its part. In view of this we find deficiency in service and unfair trade practice on behalf of the OP-4. In the result the complainant is entitle to get refund of Rs.5,50,000/-paid to the OP-4 towards the sale consideration along with the bank rate of interest prevailing during December 2015 along with 2% surcharge on the said amount and further a sum of Rs.50,000/- as damages for causing mental agony, physical hardship and financial loss and further a sum of Rs.15,000/- towards the litigation expenses, as OP-4 refused to refund the amount though it very well knew that the project has not taken off and the land could not allotted to the complainant and get it registered in his favour, which made the complainant into to engage and advocate and file this complaint before this Commission.

30.   OP.1 is a separate entity not related to OP-4. OP-2 and 3 are the employees of OP-4 and cannot be held responsible as no liability can be fastened on them.  Hence the complaint against OP.1, 2 and 3 are liable to be dismissed. Whereas the same has to be allowed against OP-4 as discussed, and We answer POINT.2 PARTLY IN THE AFFIRMATIVE against OP.4 only and   pass the following;

ORDER

1. Complaint is allowed in part with cost.
2. OP-4 i.e. M/s Expat Projects and Development Pvt. Ltd., represented by its authorized signatory is hereby directed  is directed to pay Rs.5,50,000/- to the complainant towards the sale consideration along with the bank rate of interest prevailing during December 2015 along with 2% surcharge on the said amount.
3.  OP-4 further directed to pay a sum of Rs.50,000/- as damages and Rs.15,000/- towards  cost of litigation expenses.
4. Complaint against OP.1, 2 and 3 are hereby dismissed.
5. The OP-4 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.
6. 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 29^TH DAY OF JUNE 2022)

MEMBER                 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: Copy of the Power of attorney

Ex P2: Copy of the receipt issued by OP.

Ex. P3: Acknowledgement issued by OP

Ex P4: Copy of the letter written by OP.

Ex P5: Copy of the agreement

Ex P6: Copy of the legal notice

Ex P7: Copy of the reply given by OP.

Ex P8: Copy of another notice dated 11.11.2019.

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

RW-1: Sri.Ravi Kumar, Authorized Signatory.  

Copies of Documents produced on behalf of Opposite Party/s

Ex R1: Copy of the reply to the legal notice email dated 15.04.2020.

Ex R2: Certificate u/s 65-B in support of email

Ex R3: Copy of the board resolution.

MEMBER                 MEMBER               PRESIDENT

RAK*