Chandigarh

StateCommission

CC/311/2018

Samreen Sekhon Brar - Complainant(s)

Versus

Ansal Lotus Melange Projects Pvt Ltd - Opp.Party(s)

Surinder Garg, Adv.

25 Mar 2019

ORDER

 STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

1. Samreen Sekhon Brar aged about 32 years W/o Sh.Ajitpal Singh.
2. Ajitpal Singh aged about 33 years S/o Sh.Nirmal Singh.
3. Nirmal Singh aged 63 years S/o Sh.Balbir Singh.

All residents of Duareana Road, Kotkapura, Distt. Faridkot (Pb) (now residing at Flat No.103, Tower-10, Ansal API, Sector 115, Landran Road, Kharar, Distt. Mohali (Pb.)

…… Complainants

V e r s u s

1. Ansal Lotus Melange Projects Pvt. Ltd., Regd. Office at A-1/18, Asaf Ali Road, New Delhi-110002.
2. Ansal Lotus Melange Projects Pvt. Ltd., SCO No.183-184, Sector 9-C, Chandigarh-160009.

…..Opposite Parties

Argued by:-     Sh.Surinder Garg, Advocate for the complainants.

                       Sh.Sandeep Kumar, Advocate for the opposite parties.

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1. Ms.Sonia Gill D/o Late Sh.Tara Singh, r/o House No.83, Type II, NW, Moti Bagh, New Delhi.
2. Bhupinder Singh Gill S/o Trilochan Singh Gill, R/o House No.3296, Sector 19D, Chandigarh.

…… Complainants

V e r s u s

1. Ansal Lotus Melange Projects Pvt. Ltd., through its Director Authorized Representative Regd. Office 1/18-B, Asaf Ali Road, New Delhi-110002.
2. Ansal Lotus Melange Projects Pvt. Ltd., through its Director Authorized Representative Regd. Office SCO No.183-184, Sector 9-C, Madhya Marg, Chandigarh.

…..Opposite Parties

Argued by:-     Sh.Bhupinder Singh Gill, complainant no.2 in person and on behalf of complainant no.1.

                       Sh.Sandeep Kumar, Advocate for the opposite parties.

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Complaints under Section 17 of the Consumer Protection Act, 1986

BEFORE:      JUSTICE JASBIR SINGH (RETD.), PRESIDENT.

                     MRS. PADMA PANDEY, MEMBER.

                     MR.RAJESH K ARYA, MEMBER.

JUSTICE JASBIR SINGH (RETD.), PRESIDENT

                By this order, we propose to dispose of aforesaid two consumer complaints. Arguments were heard in common, in the above cases, as the issues involved therein, except minor variations, here and there, of law and facts are the same. At the time of arguments, on 11.03.2019, it was agreed by the contesting parties, that facts involved in the above complaints, by and large, are the same, and therefore, both the complaints can be disposed of, by passing a consolidated order.

2.         To dictate order, facts are being taken from consumer complaint bearing no. 311 of 2018 titled as Samreen Sekhon Brar and ors. Vs. Ansal Lotus Melange Projects Pvt. Ltd. and another. The complainants have filed this compliant, seeking refund of amount of Rs.22,52,000/- paid by them, towards purchase of flat bearing no.105, Tower No.1, First Floor, measuring 1664 square feet, @ Rs.3056/- per square feet, for total sale consideration of Rs.50,85,184/-, in a project launched by the opposite parties, under the name and style ‘Orchard County’, near Kharar-Landran Road, Mohali, Punjab, on the ground that despite making payment of Rs.22,52,000/- till 03.03.2015, the opposite parties failed to offer and deliver actual physical possession thereof, which otherwise was to be handed over on or before 22.06.2018 i.e. 54 months, from the date of execution of Buyer’s Agreement dated 23.12.2013,  for want of construction and development at the project site. It is specific case of the complainants that in the absence of possession of the unit, in question, they are forced to live in a rented accommodation.  For making payment towards price of the said unit, the complainants applied for loan from HDFC Limited, which approved the same, for an amount of Rs.25 lacs. Tripartite Agreement dated 15.07.2014 Annexure C-8 was also executed between the complainants, opposite parties and HDFC Limited.  However, since construction of the tower in question had not been completed, the HDFC Limited later on, cancelled the loan agreement. In this manner, the complainants were caused financial loss, as firstly they were forced to live in a rented accommodation and secondly, they had to arrange funds from their near and dear ones, for making payment towards price of the unit. Number of requests were made by the complainants, to the opposite parties, through every possible means i.e. by writing letters, physical visits etc., to complete construction of the tower, in which the unit, in question, is located but to of no avail. Left with no alternative, the complainants served notice dated 13.11.2017 to the opposite parties, seeking refund of the amount paid with interest etc. but the same was not even replied by them. Even by the date of filing this complaint, the opposite parties were not in a position to deliver possession of the unit, in the developed project, for want of construction, as it has virtually been stopped. It was stated that, earlier, the complainants had filed consumer complaint bearing No.113 of 2018 before this Commission, which had been got dismissed as withdrawn, vide order dated 14.03.2018, with liberty to file it again, at an appropriate stage. Hence this complaint.
3.         Upon notice, joint reply was filed by the opposite parties, wherein, the fact regarding purchase of the unit, in question, by the complainants; price of the unit mentioned in the complaint; sale consideration paid by the complainants towards price of the unit; execution of Agreement dated 23.12.2013 containing detailed terms and conditions, and mentioning of offering/delivering possession of the unit, in question, within a maximum period of 54 months, as stated above, is not seriously disputed.

                It was pleaded that the period of 54 months, for delivering possession of the unit, was tentative. Since the said period was to run from the date of receiving requisite approvals/sanctions from the Competent Authorities, as such, time was not to be considered as essence of contract. The complainants have concealed material facts and approached this Commission with uncleaned hands. It was averred that the unit, in question, was purchased for future gain, as such, the complainants being investors, would not fall within the definition of consumer, as defined under Section 2 (1) (d) of the Act. It was stated that the opposite parties are committed to pay Pre-EMI to the Bank concerned and also compensation for the period of delay as provided in the Allotment Letter/Agreement, till offer of possession of the unit is made to the complainants. It was pleaded that the complainants were defaulters in making payment towards price of the unit, in question. They were offered relocation, in ready to move unit but they are adamant for taking refund of the amount paid. It was submitted that the complaint is bad for non-joinder of HDFC as necessary party, as such, it is liable to be dismissed on this ground alone. The remaining averments were denied being wrong. It was prayed that the complaint having no substance, be dismissed.

4.          In the rejoinder filed, the complainants reiterated all the averments contained in the complaint and repudiated those contained in written version of the opposite parties.
5.         We have heard the contesting parties, and have gone through the evidence and record of the cases, very carefully.
6.         The first question, that falls for consideration, is, as to whether, the complainants are speculators, and that they have purchased the unit, in question, for earning profits i.e. for resale, as and when there is escalation in the prices of real estate, therefore, they would not fall within the definition of consumer, as defined by Section 2 (1) (d) of the Act., as alleged by  the opposite parties. It may be stated here that there is nothing, on record to show that the complainants are property dealers and are indulged in sale and purchase of property, on regular basis. In their complaint, in para no.6, it has been specifically stated by the complainants that the unit, in question, was purchased by them for their personal use. Thus, in the absence of any cogent evidence, mere bald assertion raised by the opposite parties to that effect, cannot be taken into consideration. In a case titled as Kavita Ahuja Vs. Shipra Estate Ltd. and Jai Krishna Estate Developer Pvt. Ltd. 2016 (1) CPJ 31, decided by the National Consumer Disputes Redressal Commission, New Delhi, it was held that the buyer(s) of the residential unit(s), would be termed as consumer(s), unless it is proved that he or she had booked the same for commercial purpose. Similar view was reiterated by the National Commission, in DLF Universal Limited Vs Nirmala Devi Gupta,  2016 (2) CPJ 316. The principle of law, laid down, in the aforesaid cases, is fully applicable to the present case.
7.         It is not in dispute that the complainants have paid an amount of Rs.22,52,000/- to the opposite parties, towards purchase of the unit, in question. As per Clause 5.1 of the Agreement dated 23.12.2013, possession of the unit, in question, was to delivered within a maximum period of 54 months, from the date of execution thereof i.e. on or before 22.06.2018. The fact that possession of the unit, has neither been offered nor delivered, even by the date of filing this complaint is not disputed. It was not offered during pendency of this complaint even. At the time of arguments, when specific question was put to Counsel for the opposite parties, regarding possession, he stated that construction work and development activities are near completion and possession of the unit will be delivered shortly to the complainants. However, no cogent and convincing evidence in the shape of any reports and affidavits of the Engineers/Architects, as they could be said to be the best persons, to testify, as to whether, all these construction and development activities, are being undertaken and near completion, has been placed on record. It may be stated here that it is well settled law that the onus to prove that construction of the unit(s) had been completed and the area/site, in question, is fully developed, is on the builder. It was also so said by the National Commission, in Emaar MGF Land Limited and another Vs. Krishan Chander Chandna, First Appeal No.873 of 2013 decided on 29.09.2014. As stated above, possession of the built-up unit was to be delivered on or before 22.06.2018, however, the opposite parties failed to do so. As such, there is a delay on their part, which act amounted to deficiency in providing service and negligence. It appears that promise to handover possession of the unit, in question, was made without any intention to do so, as such, this act also amounts to adoption of unfair trade practice on their part.

                Furthermore, there is nothing on record to show that   the opposite parties suffered any force majeure circumstances, on account of which, construction and development at the project site, could not be completed by the stipulated date or even till the date, when arguments were heard in this complaint. In the absence of any force majeure circumstances having been faced by the opposite parties, they were bound to deliver possession of the built-up unit, by 22.06.2018, as such, time was, unequivocally made the essence of contract, by way of Clause 5.1 of the Agreement, referred to above. The opposite parties cannot evade their liability, merely by saying that since the words “shall endeavor” was mentioned in Clause 5.1 of the Agreement, for delivery of possession of the unit, as such, time is not to be considered as essence of the contract. The act of non-mentioning of exact date in the allotment letter/Agreement is violation of CHAPTER II Regulation of Promotion of Construction, Sale, Transfer and Management of Apartments, Plots and Properties, Condition no. 3(2) (g) of the Punjab Apartment and Property Regulation Act, 1995 (PAPRA), which says that the project proponent is duty bound to specify, in writing, the date by which possession of the residential plot/unit is to be handed over and it shall hand over such possession accordingly. Relevant contents of Condition no.3(2) (g) of the PAPRA are reproduced below:-

“(g) specify, in writing, the date by which possession of the plot or apartment is to be handed over and he shall hand over such possession accordingly”;

Furthermore, non-mentioning of exact date of delivery of possession of the plot(s)/unit(s) in the Buyer’s Agreement/ allotment letter, is an unfair trade practice on the part of the Builder. The builder is bound to mention the exact/specific date of delivery of possession of the plots/unit(s) to the allottees/purchasers thereof. It was so said by the Hon`ble National Commission, in Rajeev Nohwar & Anr. V/S Sahajanand Hi Tech Construction Pvt Ltd, 2016 (2) CPR 769. Relevant portion of the said case reads thus:-

“Merely making possession by a particular date will also not meet the requirement of law and the promotor is under a legal mandate to stipulate a specific date for delivery of possession of the flat in the agreement which he executes with the flat buyer”.

In view of above, the plea of the opposite parties, in this regard, stands rejected.

8.         Furthermore, from the contents of reply filed by  the opposite parties, to the effect that the period to  deliver possession of the unit, as mentioned in the Agreement, was to run, once all necessary approvals and sanctions have been obtained from the Competent Authorities, it is proved that the project in question was launched and sold to the buyers including the complainants, without having necessary sanctions in their hands. Collecting money from the perspective buyers and selling the project, without obtaining the required permissions and sanctions is an unfair trade practice on the part of the project proponent. It was so said by the National Commission, in a case titled as M/s Ittina Properties Pvt. Ltd. & 3 Ors. Vs. Vidya Raghupathi & Anr., First Appeal No. 1787 of 2016, decided on 31 May 2018. Relevant part of the said order reads thus:-

“…………….This Commission in Brig. (Retd.) Kamal Sood Vs. M/s. DLF Universal Ltd., (2007) SCC Online NCDRC 28, has observed that it is unfair trade practice on the part of the Builder to collect money from the perspective buyers without obtaining the required permission and that it is duty of the Builder to first obtain the requisite permissions and sanctions and only thereafter collect the consideration money from the purchasers.

It is an admitted fact that the sale deeds were executed in the year 2006 and by 2009 the completion certificate was not issued. The Occupancy Certificate was issued only on 25.09.2017 during the pendency of these Appeals before this Commission. Allotting Plots or Apartments before procuring the relevant sanctions and approvals is per se deficiency…………”

                The principle of law, laid down in the aforesaid case, is fully applicable to the present case. In view of above, it can safely be said that by adopting unfair trade practice, the project was sold/launched by  the opposite parties.

9.         A plea was also taken by the opposite parties that they are ready to compensate the complainants by making payment of Rs.5/- per square feet per month of the super area of the unit, for the period of delay in possession, as per Clause 5.5 of the Agreement, as such, the complainants are estopped from seeking refund of the amount paid, even if there is delay in offering possession of the unit, in question. It may be stated here that it is settled law that when there is a material violation on the part of the builder, in not handing over possession by the stipulated date, the purchaser is not bound to accept the offer, even if the same is made at a belated stage and on the other hand, can seek refund of amount paid. It was so said by the National Commission, in a case titled as Aashish Oberai Vs. Emaar MGF Land Limited, Consumer Case No. 70 of 2015, decided on 14 Sep 2016 and  M/s. Emaar MGF Land Ltd. & Anr. Vs. Dr.Manuj Chhabra, First Appeal No.1028 of 2015, decided on 19.04.2016.

                In the present case also, since there is a delay in offering possession of unit, in question, the complainants cannot be made to wait further for an indefinite period, at the whims and fancies of the opposite parties, especially, when still no firm date of delivery of possession has been given. Still they are not aware of the fact, as to when they will be able to deliver possession of the unit to the complainants, in near future.  They are thus held liable to refund of the amount paid by the complainants, alongwith interest, from the respective dates of deposits till realization.      

                At the same time, the complainants cannot be compelled and also are not bound to accept any alternative unit, except what has been booked by them, in view of principle of law laid down by the National Commission, in the case titled as Sujay Bharatiya & Anr. Vs. Unitech Reliable Projects Pvt. Ltd., Consumer Case No. 1814 of 2017 decided on 05.07.2018. Relevant part of the said order reads thus:-

“This Commission in Emaar MGF Land Ltd. & Anr. V. Amit Puri (First Appeal No.250 of 2014), decided on 30.03.2015, has held that if the Developer fails to deliver possession of the allotted plot/flat within the stipulated time, the allottee is under no obligation to accept an alternative plot. At the cost of repetition, we may reiterate that in the event of Developer failing to deliver possession of the property within the stipulated period, for any reason, save and except a force majeure condition, agreed to between the contracting parties, an allottee cannot be compelled to accept an alternate site/plot and he would be within his rights to seek refund of the amount deposited with the Developer against allotment”.

10.         As far as plea taken to the effect that the complainants were defaulters in making payment towards price of the said unit, it may be stated here that the opposite parties failed to place on record, any document in that regard. Alongwith written statement, not even a single document has been attached, by the opposite parties, to substantiate their objections/pleas taken therein. The opposite parties themselves were deficient in providing service, in not completing the construction and developing the project and offering possession of the unit, by the stipulated date or even thereafter. In that case, the opposite parties cannot expect the complainants to keep on making the amount due towards remaining sale consideration. 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, had held that if the builder is at fault in not delivering possession of the unit by the stipulated date, it cannot expect the allottee(s) to go on paying instalments to it. Similar view was also taken by the 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. Under these circumstances, in no way, the complainants can be termed as defaulters. Objection taken in this regard, stands rejected.  
11.         As far as objection taken to the effect that since the complainants failed to implead HDFC Limited as necessary party, from which they had raised loan for making payment towards price of the said unit, to which they (opposite parties) are paying Pre-EMI, it may be stated here that the complainants in para no.9 of their complaint have clearly stated that on account of the reason that the opposite parties failed to construct the tower, in which the unit, in question, was located,  as such, Loan Agreement executed between the parties was cancelled by the HDFC Limited. At the same time, the opposite parties failed to place on record any document, which could convince this Commission, that Pre-EMI was ever paid by them to the HDFC Limited, under subvention scheme. As such, when the said agreement in respect of the housing loan was cancelled by the HDFC Limited, as such, there was no reason to implead it in the complaint. In case, any dispute existed between the parties in that regard, the opposite parties were free to obtain relevant document from the HDFC Limited, and could have produced it before this Commission but it failed to do so. However, even then, as a precautionary measure, this Commission will take care of this issue, while awarding relief below.
12.         Now coming to the objections taken by the opposite parties in connected consumer complaint no.178 of 2018, like the complaint filed is barred by limitation; no service was to be provided to the complainants by the opposite parties; since the dispute is related regarding construction of a unit i.e. immovable property, as such, it is not maintainable before the Consumer Fora; the dispute being related to contractual nature, only a Civil Court can decide the case; and that delay is solely attributable to the circumstances, beyond control of the opposite parties.

                First coming to the objection raised in connected consumer complaint bearing no. 178 of 2018, to the effect that this complaint  is barred by limitation, it may be stated here that since it is an admitted fact that possession of the unit, has not been offered to the complainants, for want of construction and development activities, as such, there was a continuing cause of action in their favour, in view of principle of law down, in  Lata Construction & Ors. Vs. Dr. Rameshchandra Ramniklal   Shah  and Anr., II 2000 (1) CPC 269=AIR 1999 SC 380 and Meerut Development Authority Vs. Mukesh Kumar Gupta, IV (2012) CPJ 12 (SC),  wherein it was held that when possession of the residential units is not offered, there is a continuing cause of action, in favour of the allottee/buyer. Objection raised in this regard, as such, is rejected.

                Coming to the plea taken that delay in offer of possession of the unit, took place on account of the circumstances beyond control of the opposite parties, it is reiterated that there is no cogent and convincing evidence on record, which could convince this Commission, to pass any positive findings, giving any immunity to the opposite parties, to condone the delay in delivery of possession thereof.  Bald plea taken by the opposite parties, is insufficient to establish a bonafide and credible defence to a claim premised on circumstances beyond their control, which resulted into delay in offer and delivery of possession of the unit, to the complainants.

                Now coming to the objection in connected consumer complaint bearing no. 178 of 2018, that the dispute being related to contractual nature and also no service was to be provided to the complainants, as such, the consumer complaint is not maintainable, and only a Civil Court can decide the case. It may be stated here that the complainants hired the services of the opposite parties, for purchasing the built-up, possession of which was to delivered within a maximum period of 54 months, from the date of execution of Buyer’s Agreement dated 23.12.2013 i.e. on or before 22.06.2018. By not doing so, the opposite parties have breached the terms and conditions of the agreement, leading to deficiency in providing service, negligence and adoption of unfair trade practice. In Narne Construction P. Ltd., etc. etc. Vs.  Union of India and Ors. Etc., II (2012) CPJ 4 (SC), it was held that when a person applies for the allotment of a building or site or for a flat constructed by the Development Authority and enters into an agreement with the Developer, or the Contractor, the nature of transaction is covered by the expression ‘service’ of any description. Housing construction or building activity carried on by a private or statutory body constitutes ‘service’ within the ambit of Section 2(1)(o) of the Act. Similar principle of law was laid down, in Haryana Agricultural Marketing Board Vs. Bishambar Dayal Goyal & Ors. (AIR 2014 S.C. 1766). Under these circumstances, the complaint involves the consumer dispute, and the same is maintainable before this Commission. Not only as above, Section 3 of the Act provides an alternative remedy. Even if it is assumed for the sake of arguments only that the complainants have a remedy to file a suit, in the Civil Court, the alternative remedy provided under Section 3 of the Act, can also be availed of by them, as they fall within the definition of consumer. In this view of the matter, objection taken by the opposite parties, in this regard, being devoid of merit, must fail and the same stands rejected.

13.         No other point, was urged, by the contesting parties.
14.         For the reasons recorded above, both the complaints are partly accepted, with costs, in the following manner: -

In Consumer Complaint bearing No.311 of 2018, the opposite parties, jointly and severally are directed as under:-

1.       To refund the entire amount, actually paid by the complainants from their own sources/pocket, at the time of booking and thereafter also, towards price of unit, alongwith interest @12% p.a., from the respective dates of deposits onwards.
2.       To pay compensation, in the sum of Rs.75,000/- for causing mental agony and physical harassment, to the complainants, as also escalation in prices.
3.       To pay cost of litigation, to the tune of Rs.32,000/- to the complainants.

In Consumer Complaint bearing No.178 of 2018, the opposite parties, jointly and severally are directed as under:-

1.   To refund the entire amount, actually paid by the complainants from their own sources/ pocket, at the time of booking and thereafter also, towards price of unit, alongwith interest @12% p.a., from the respective dates of deposits onwards.
2.   To pay compensation, in the sum of Rs.75,000/- for causing mental agony and physical harassment, to the complainants, as also escalation in prices.
3.   To pay cost of litigation, to the tune of Rs.32,000/- to the complainants.

15.         The payment of awarded amounts mentioned at sr.nos.(i) to (iii) shall be made by the opposite parties to the complainants, in the respective complaints, within a period of 45 days, from the date of receipt of a certified copy of this order, failing which, the amount mentioned at sr.no.(i) thereafter shall carry penal interest @14% p.a., instead of @12%, from the date of default and interest @12 % p.a., on the amounts mentioned at sr.nos. (ii) and (iii) from the date of filing respective complaints, till realization. In case, the complainants in any of the complaint above, have raised housing loan from any Financial Institution/Bank, it shall have first charge, over the due amount, if any.
16.         However, it is further made clear, that in case, in any of the complaint above, the complainants have raised housing loan, under subvention scheme, in that case, Pre-EMI interest if  any (due or future Pre-EMI) shall be paid by the opposite parties/Company and also the entire loan amount shall be repaid by them (opposite parties/Company), to the Financial Institution/Bank concerned, till realization. These directions will come in force only if the loan has been obtained and released, under subvention scheme.
17.         Certified Copy of this order be sent to the parties, free of charge and one copy be placed in the file of connected case, referred to above.
18.         The file be consigned to Record Room, after completion.

Pronounced.

25.03.2019

Sd/-

 [JUSTICE JASBIR SINGH (RETD.)]

PRESIDENT

Sd/-

 (PADMA PANDEY)

        MEMBER

Sd/-

 [RAJESH K ARYA]

 MEMBER

Rg.