For the Appellant                 Mr. Alok Mukhopadhyay, Advocate with

                                                                                Mr. Vikas Nautiyal, Advocate

For the Respondent              Mr. Siddhartha Patra, Advocate

ORDER

This Appeal under section 51 of the Consumer Protection Act 2019 challenges the order dated 26.02.2020 of the State Consumer Disputes Redressal Commission, West Bengal (for short “the State Commission”) in Consumer Complaint No.275 of 2016 whereby the State Commission allowed the complaint and directed the Appellant herein to refund to the Respondent/Complainant ₹18,06,618/- along with compensation in the form of simple interest @ 18% p.a. from the date of payment till its realization and awarded litigation costs of ₹10,000/-.  The payment was to be made within 45 days of the order.

2.      In brief, the facts relevant are that the Respondents had booked Flat No.2F, IInd  Floor, Block No.1 along with a covered car parking space in Appellant’s project “Lavanya” situated at Mouza Basina Gram, P.S. Rajarhat, Dist. North 24 Parganas within the local limits of Bishnupur No.2 Gram Panchayat, West Bengal.  An Agreement for Sale was executed between the parties on 25.04.2011 as per which the project was to be completed within 24 months with grace period of six months.  According to the Appellant, a Completion Certificate was obtained from the Gram Panchayat on 11.12.2015 and a letter for fit outs with a request to take possession was issued to the Respondent on 09.02.2016.  However, the Respondent failed to take offered possession and instead filed a Consumer Complaint before the State Commission alleging that the flat was not complete and habitable.  The said Complaint was disposed of on contest vide the impugned order with the following directions:

“With the above discussions, we disposed of the complaint with the following directions:

          (i) The Opposite Parties are directed to refund ₹18,06,618/- along with compensation in the form of simple interest thereon @ 18% p.a. in favour of complainant as per agreement from the date of payment till its realisation;

          (ii) The Opposite Parties are directed to pay a sum of ₹10,000/- as litigation costs to the complainant;

          (iii) The payments should be made within 45 days in terms of the above order.”

3.      This order is impugned before this Commission on the ground that the flat in question had been completed in all respects except for the fact that the electricity connection was not provided by West Bengal State Electricity Distribution Company Limited (WBSEDCL) and, therefore, was covered under force majeure circumstances as per Clause 16.1 of the Agreement.   It was contended that WBSEDCL had inspected the project on 13.12.2012 and issued a report dated 17.12.2012 with a quotation for supervision charges of ₹13,07,400/- on 06.02.2014 which was deposited by the Appellant on 22.02.2014.  Despite the above, WBSEDCL issued a quotation for individual meters in the project in October 2016.  According to the Appellant, this constituted a force majeure event as non-supply of electricity was beyond its control and therefore, the impugned order had failed to appreciate these submissions and erroneously passed the impugned order.

4.      I have heard learned counsel for both the parties and given careful consideration to the material on record.

5.      The contention of the Appellant is that it had obtained a Completion Certificate dated 11.12.2015 with certifies that the project had been sanctioned by Rajarhat Bishnupur No.2 Gram Panchayat on 04.04.2010 and that the construction work had been completed except power supply from WBSEDCL on 11. 12.2015.  It is further contended that several other allottees had taken over possession and were residing in the flats.  It was also contended that the impugned order was flawed since it had ordered refund with interest while the Respondent had only prayed for possession.  It was stated that there was no deficiency in service on its part since the delay in giving possession was due to delay in getting electricity connection which was beyond its control.  It was also contended that the State Commission had erred in failing to consider its own order in Suman Kumar Pattnaik vs. M/s Orchid Devcelopers Pvt. Ltd. & Anr.  CC/137/2017 dated 26.02.2020 in which the direction had been to pay compensation in the form of simple interest from the date of execution of the Agreement for Sale till the date of fit out notice.

6.      Per contra it was contended by the Respondent that he had paid a sum of ₹18,06,618/- along with service taxes as per the Agreement and that as per the Agreement dated 25.04.2011 (Article VII), physical possession had been promised within 24 months with a grace period of six months.  Despite issue of a legal notice, the Appellant only issued Provisional Access Letter dated 09.02.2016 for the purpose of undertaking fit outs.  It was contended that since the electricity connection was an essential precondition for occupation of the flat, the offer of possession was an incomplete offer and that the defence of force majeure relied upon by the Appellant was not applicable in this case.  Reliance was placed by on the Hon’ble Supreme Court’s judgment in Bharati Knitting Company vs. DHL Worldwide Express Courier Division of Airfreight Ltd. AIR 1996 SC 2508 to argue that the terms of the Agreement were binding on both the parties.  It was contended that the order of the State Commission was valid and deserved to be upheld.

7.      From the foregoing, it is evident that the Appellant was required to hand over possession of the flat in question within a maximum period of 30 months from the date of Agreement, (25.04.2011) i.e. by 25.10.2013 and that it had only offered possession on 09.02.2016 for the purpose of undertaking fit outs.  The Completion Certificate, as obtained from the local Gram Panchayat Authority, relied upon by the Appellant clearly recorded that only civil construction work had been completed and the power supply had not been provided.  Admittedly, the offer of position for fit out did not constitute an actual offer of possession.  Furthermore, the offer of possession without electricity connection cannot be accepted as a valid offer of possession, as claimed by the Appellant.

8.      The contention of the Appellant that the case is covered under force majeure also cannot be accepted since it was its responsibility as a builder to have effective coordination with external agencies such as WBSEDCL under the provisions of the Rules for arranging power supply.  In fact the provision of a grace period in the agreement is a provision of time to meet unforeseen exigencies in the execution and completion of the project.  Inordinate delay beyond this period, as is evident in this case, certainly constitutes deficiency in service for which sale consideration had been received by the Appellant.  It is not Appellant’s case that the Respondent had delayed in making payments or was a defaulter.  The argument that there was no deficiency in service and that the matter was covered under force majeure circumstances cannot, therefore, be accepted.  Deficiency in service is manifest both in terms of delay of time and in terms of an offer of possession which is not valid.

9.      As regards the argument that the prayer of the Respondent before the State Commission was for possession and that the State Commission had erred in ordering refund with interest has also been considered.  The prayer of the Respondent before the State Commission reads as follows:

“a)That the Opposite Parties jointly and severally be directed to execute and register the proper deed of conveyance in favour of the complainant or their nominated person/persons in respect of the “B” schedule property as per terms and conditions of the agreement for sale;

Or

In case of failure to execute and register the deed of sale by the Opposite Parties, in that case the execution and registration of the deed of sale may be effected through process of the Ld. Commission.

b) That the Opposite Parties jointly and severally be directed to obtain completion certificate from the Local Municipality or any authorities which are competent to issue the same;

c) That the Opposite Parties jointly and severally be directed to issue possession certificate in respect of the “B” schedule property in favour of the complainant as per the Agreement;

d) That the Opposite Parties jointly and severally be directed to pay to the Petitioners a sum of ₹10,00,000/- (Rupees Ten Lakhs only) towards deprivation, harassment and anxiety suffered by them;

e) That the Opposite Parties jointly and severally be directed to pay to the Petitioners a sum of ₹2,00,000/- (Rupees Two Lakhs only) towards only as litigation cost;

f) That the Opposite Parties jointly and severally be directed to pay 18% interest per annum since 25.04.2011 till the disposal of the suit upon the paid amount a sum of ₹18,06,618/- (Rupees Eighteen Lakhs Six Thousand Six Hundred and Eighteen only);

g) That refund entire paid sum along with interest as determined by the Commission deems fit and proper as complaint have to arrange a habitable flat to stay;

h) Any other relief/reliefs to which the Petitioner may be entitled under the law.”  

10.    It is apparent that the Respondent had prayed for possession of the flat in question and the execution and registration of deed of conveyance.  However, an alternative prayer at para “g” was also made to refund the entire paid sum along with interest.  The order of the State Commission cannot therefore be faulted in ordering refund of the amount paid by the Respondent to the Appellant along with interest.  

11.    As regards the quantum of compensation by way of interest awarded by the State Commission, however, it is seen that the State Commission has considered awarding simple interest at 18% p.a. in terms of the Agreement as per which the Appellant had undertaken to compensate the Respondent allottee at this rate in case of delay.  In Experion Developers Pvt. Ltd. Vs. Sushma Ashok Shiroor, C.A. No. 6044 of 2019 decided on 07.04.2022 the Hon’ble Supreme Court has held that interest payable on the amount deposited has to be restitutionary and also compensatory and that interest @ 9% p.a. was considered to be fair and just in cases where refund of deposited amount was ordered.   It had also been held that this rate of interest would be applicable from the date of respective deposits.  Respectfully following the law laid down by the Hon’ble Supreme Court as mentioned above, the Appeal is partly allowed with the following directions:

(i)     The Appellant is directed to refund ₹18,06,618/- with interest @ 9% p.a. from the respective dates of deposits till its realization within eight weeks, without deduction of any TDS charges, failing which the applicable rate of interest shall be 12% p.a.

(ii)    Litigation costs of ₹25,000/- shall be paid by the Appellant to the Respondent along with amount as mentioned above.

12.    Pending IAs, if any, also stand disposed of with this order.