Chandigarh

StateCommission

CC/231/2016

Devki Nandan Kapoor - Complainant(s)

Versus

BCL Homes Ltd. - Opp.Party(s)

Vandanaa Malhotra & Rajnees Malhotra, Adv.

14 Sep 2016

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Complaint No.	:	231 of 2016
Date of Institution	:	24.05.2016
Date of Decision	:	14.09.2016

 

1. Devki Nandan Kapoor son of Sh.Sham Sunder Kapoor, resident of House No.52, Gandhi Nagar, Sigra, Varanasi-221010, U.P.
2. Smt.Chetan Kapoor wife of Devki Nandan Kapoor, resident of House No.52, Gandhi Nagar, Sigra, Varanasi-221010, U.P.

…Complainants

V e r s u s

 

1. BCL Homes Ltd., Regd. Office: Shop No.140, Railway Road, Village Dariya, U.T., Chandigarh, through its Authorized Signatory.
2. BCL Homes Ltd., Village Kishanpura, NAC Zirakpur, District Mohali, Punjab, through its Project Incharge.
3. BCL Homes Ltd., through its Managing Director, Sh.Baldev Chand Bansal, 253, Sector 7, Panchkula, Haryana-134109.

....Opposite Parties

 

Complaint under Section 17 of the Consumer Protection Act, 1986.

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

                        MR. DEV RAJ, MEMBER.

                        MRS. PADMA PANDEY, MEMBER

 

Argued by:-       Sh.Varun Chawla, Advocate for the complainants.

                         Sh.Puneet Tuli, Advocate for opposite parties.        

PER JUSTICE JASBIR SINGH (RETD.), PRESIDENT

                The complainants are husband and wife. Allured by false promises made by representatives of the opposite parties, the complainants purchased one built-up flat bearing no.603, A, Type 3 BHK, 6^th Floor, Tower No.2, measuring 2170 square feet, in a project launched by them (opposite parties), under the name and style of “Chinar Homes”, Kishanpura, Zirakpur. Allotment letter was issued in favour of the complainants on 02.01.2013. The said unit was purchased for an amount of Rs.50.50 lacs. It was stated that by 02.01.2013, the complainants had paid the entire amount, towards sale consideration of the said unit, in the following manner:-

 

Sr.No.	Particulars	Received against Receipt No. and date	Amount
	Cheque no.000362 dated 16.01.2013 drawn of Bank of Maharashtra	No.5726 dated 01.01.2013	10,00,000/-
	Cheque no.000361 dated 01.01.2013 drawn of Bank of Maharashtra	No.5727 dated 01.01.2013	40,00,000/-
	In Cash	No.5728 dated 02.01.2013	50,000/-

 

                To support above contention, receipts have been placed on record as Annexures C-2 to C-4. It is stated that possession of the flat was to be handed over to the complainants, after fully developing the project area. Detail of facilities promised to be provided in the said project is given in para no.3 of the complaint. As per clause 9 of the allotment letter, possession of the unit, in question, was to be delivered to the complainants, by the opposite parties, within a period of 18 to 24 months, with a grace period of three months (total 27 months), from the date of issuance of allotment letter i.e. on or before 01.04.2015, after providing all the basic amenities. It was further stipulated in clause 9 that, in case, the opposite parties, failed to deliver possession of the unit by the said date, they were liable to make payment of Rs.10,000/- per month, to the complainants, towards rent, for the period of delay, beyond 27 months aforesaid.

2.         It is further stated that when the project site was visited, it was noticed that construction is behind the schedule. Construction work, qua none of the towers has been completed. When possession of the unit was not offered/delivered and also it was not visible in the near future, the complainants sent notice dated 20.05.2014, Annexure C-6 to the opposite parties seeking information, as to when possession of the unit will be offered/delivered.

                Again to know status of construction, letter was written on 30.11.2015 Annexure C-7. In the said letter, it was specifically stated that if flat is not ready for possession then rent amount alongwith amount paid be refunded to the complainants. Under similar circumstances, another letter was sent on 30.12.2015 Annexure C-8. Thereafter, many emails were sent by the complainants claiming possession/refund, however, without any result. Neither possession of the unit was delivered, nor rent amount @Rs.10,000/- per month for the delayed period, was paid to the complainants. It is further stated that internal development at the project site is not complete. Under above circumstances, legal notice dated 25.03.2016 to hand over physical possession of the flat or in the alternative refund the amount paid alongwith interest, was served upon the opposite parties but to no avail. To show that development/ construction work was not complete at the site, photographs taken at the site have been placed on record.

3.         By stating as above, it is prayed that directions be issued to the opposite parties to refund the amount paid alongwith interest. Additional prayer has been made to issue directions to the opposite parties to pay an amount of rent @Rs.10,000/- per month, for the delayed period. Besides above, compensation for mental agony and physical harassment alongwith litigation expenses have also been claimed.
4.         Upon notice, reply was filed by the opposite parties, wherein it was stated that dispute between the parties being of civil nature, could only be adjudicated upon by a Competent Civil Court. Territorial jurisdiction of this Commission was also disputed. It was averred that the complaint filed by the complainants is motivated one and is a result of malafide. It was pleaded that since the unit, in question, was purchased by the complainants for commercial purpose i.e. for investment purpose, as such, they would not fall within the definition of consumer. It was averred that the complaint is bad for misjoinder and non-joinder of parties. It was pleaded that the present complaint is barred by limitation.
5.         On merits, purchase of the flat by the complainants, for the price as stated in earlier part of this order, is not disputed. It is further stated that possession of the unit could not be offered on account of force majeure circumstances i.e. non availability of sand and other building material, as stay order was passed by the Apex Court etc. etc. It was averred that delay also occurred because the complainants defaulted in making payment of installments. Rest of the allegations made in different paragraphs of the complaint were formerly termed as false and frivolous. No commitment was given, as to within how much time, possession of the flat will be delivered to the complainants.  
6.         In the rejoinder filed by the complainants, they reiterated all the averments, contained in the complaint and repudiated those, contained in the written version of the opposite parties.
7.         The parties led evidence, in support of their case.
8.         After giving our thoughtful consideration, to the contentions, advanced by Counsel for the parties and the evidence on record we are of the considered opinion, that the complaint is liable to be partly accepted, for the reasons to be recorded hereinafter.

                It is proved on record that the complainants purchased a built-up unit referred to above, for an amount of Rs.50.50 lacs, in a project launched by the opposite parties. Allotment letter was issued in their favour on 02.01.2013. Clause 9 of the said allotment letter reads thus:-

“The possession of the said flat shall be delivered to the Allottee(s) in 18-24 months from the date of this Agreement/allotment, with a grace period of 03 months. However, in the event there is a delay in offering the possession/permissive possession of the Flat in the said period, for any reason not directly attributable to BCL Homes Ltd. shall be entitled to reasonable extension in time for delivery of possession/permissive possession. In the event of completion of the said Flat being delayed beyond 27 months from the date of this Agreement/allotment, for reasons directly attributable to BCL Homes Ltd. shall be liable to pay to the Allottee(s) monthly rent of Rs.10,000/- for the period of delay beyond the said 27 months period on the amount paid to BCL Homes Ltd. by the Allottee. The possession of the Flat shall be handed over on receipt of the all dues, documents, and on fulfillment of conditions as stipulated herein. If the physical possession is not taken over at site within 45 days of the issue of the possession letter, the Allottee shall pay watch and ward charges @0.1% of the total cost of the flat per month. Notwithstanding anything contained in this Agreement, if the allottee fails to take over possession of the said flat within six months from the date of issue of possession letter, even if other portions of Project are not complete or are in the course of construction the allotment would be liable for cancellation”. 

9.         It is stipulated therein that possession of the unit, complete in all respects, after making necessary development in the project will be delivered to the complainants, within a period of 18 to 24 months, with a grace period of three months, from the date of issuance of allotment letter. However, if possession is not delivered within 27 months as committed, the opposite parties were liable to pay an amount of Rs.10,000/- per month, for the period of delay.

                It is virtually admitted on record that till today, no offer has been made to hand over possession of the constructed unit by the opposite parties to the complainants. Rather perusal of documents on record depicts that the project is not complete and construction is virtually stopped at the site. In a case titled as Chand Berry and another Vs. BCL Homes Limited and others, consumer complaint no.292 of 2015, decided by this Commission on 19.02.2016, under similar circumstances, when deciding that complaint filed by the complainants stating that for non-delivery of possession, directions be issued to refund amount with interest, this Commission has observed as under:-

“It is a case of failed promise and virtually deceit has been committed by opposite parties no.1 to 3, with the complainants. It was never disclosed to the complainants, by opposite parties no.1 to 3,  that the entire project land and construction to be raised thereon, stood mortgaged with opposite party no.5. Virtually after making more than 95% of the price of unit, delivery of possession thereof is not expected even in near future. Above fact clearly amounted to deficiency in providing service on the part of opposite parties no.1 to 3, which entitles the complainants to get refund of amount paid by them, towards the unit.”

10.         It was noted as a matter of concern that the entire project site and the construction raised thereon stood mortgaged with the Bank namely Canara Bank. At the time of arguments, it also transpires that for committing default in repayment of loan, dispute has been raised by the financial institutions in various Courts, Debt Recovery Tribunal etc. If that is so, one cannot visualize handing over possession of the units, in near future. Neither in the written statement nor at the time of arguments, any commitment was made, giving exact time-frame, within which period, possession of the unit can be delivered to the complainants. It is on record that despite requests made by the complainants to handover possession of the unit or in the alternative to refund the amount with interest thereon, even reply was not given by the opposite parties. Above facts clearly amounted to deficiency in providing service on the part of the opposite parties, which entitle the complainants to get refund of amount paid by them, towards the unit.
11.         No doubt, a plea has been taken by the opposite parties, in their written version, to the effect that since the Hon’ble Supreme Court has imposed ban on mining, as such, building material such as sand etc., remained short to an extent, meaning thereby that they had encountered force majeure circumstances.

                It may be stated here that as regards the alleged shortage of construction material like sand etc. in the market, nothing has been placed on record, by the opposite parties, to prove that they were unable to procure the said construction material, in adequate quantity. There is no evidence of the opposite parties having invited tenders for supply of construction material and there being no response to such tenders. At the same time, it has also been submitted by Counsel for the opposite parties, at the time of arguments that the opposite parties have now started handing over possession of the units to the customers. It is also submitted by Counsel for the opposite parties that construction at the site is almost complete. If it is assumed to be true, that it remained unexplained by the opposite parties, as to how, they had been able to cover up the shortage of construction material, when there was ban on mining, as alleged. A similar plea for delay in delivery of possession of the units, was taken by a builder, before the Hon'ble National Consumer Disputes Redressal Commission, New Delhi, in  Consumer Case No.347 of 2014, titled as Swaran Talwar & 2 others v. M/s Unitech Limited (along three connected complaints),  decided on 14 Aug 2015,  which was rejected and the complaint was allowed in favour of the complainant. The principle of law, laid down, in the aforesaid case is fully applicable to be present case. In the present case also, the opposite parties failed to convince this Commission, that they encountered force majeure circumstances, as a result whereof, delay in handing over possession of the unit occurred. As such, the stand taken by them, in this regard, is rejected. 

12.           As far as the plea taken by the opposite parties to the effect that delay also took place on account of the reasons that there was delay in making payment on the part of the complainants, it may be stated here that such a plea has no legs to stand, in view of decision rendered by the National Commission, in a case titled as Puneet Malhotra Vs Parsvnath Developers Ltd., Consumer Complaint No.  232 of 2014, Decided on 29.01.2015, wherein under similar circumstances it was observed and held as under:-

“If some of the allottees had not made timely payment, it was for the opposite party to arrange the requisite finance either by taking loan or from its own resources or by liquidating Inventory at a lower price”.

 

                No help, therefore, can be drawn by the opposite parties out of the plea, raised by them, in this regard.

13.         An objection was also raised by the opposite parties, in their written version, that since the unit, in question, was situated at Mohali, Punjab, and also all the payments were made at that place, as such, this Commission has got no territorial jurisdiction to entertain and decide the complaint.

                According to Section 17 of the Act, a consumer complaint can be filed, by the complainants, before the State Consumer Disputes Redressal Commission, within the territorial Jurisdiction whereof, a part of cause of action arose to them. In the instant case, it is evident from the record, that payment in the sum of Rs.10 lacs vide receipt dated 01.01.2013 (at page 27), Rs.40 lacs vide receipt dated 01.01.2013 (at page 28) and Rs.50,000/-, vide receipt dated 02.01.2013 (at page 29) was received by the Registered Office of the opposite parties at Chandigarh i.e. Shop No.140, Railway Road, Village Dariya, U.T., Chandigarh. Since, as per the documents, referred to above, a part of cause of action, arose to the complainants, at Chandigarh, this Commission has got territorial Jurisdiction to entertain and decide the complaint.  The objection taken by the opposite parties, in their written version, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected. 

14.         Another objection was taken by the opposite parties, in their written version, that since the complainants sought enforcement of the allotment letter, in respect of the unit, in question, i.e. immoveable property, only a suit, in the Civil Court was maintainable.

                The complainants hired the services of the opposite parties, for purchasing the unit, in question, and they were allotted the same for consideration. According to clause 9 of the allotment letter, the opposite parties were required to hand over possession of the unit, in question, to the complainants, within a period of 18 to 24 months, with a grace period of three months (total 27 months), from the date of issuance of the same (allotment letter), after completing all the basic amenities. It was not that the complainants purchased the unit, in an open auction, on “as is where is basis”.  Section 2 (1) (o) of the Act, defines service as under:-

“service” means service of any description which is made available to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service”

15.         From the afore-extracted Section 2 (1) (o) of the Act, it is evident that housing construction, also comes within the definition of a service. 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. Not only this, Section 3 of the Act, provides an alternative remedy. Even if, it is assumed that the complainants had a remedy to file a suit, in the Civil Court, the alternative remedy provided under Section 3 of the Act, could be availed of by them, as they fall within the definition of a consumer. In this view of the matter, the objection  taken by the opposite parties, in their written version, being devoid of merit, must fail, and the same stands rejected.
16.         Further objection was taken by the opposite parties, in their written version, that the complaint filed by the complainants, was barred by time.

                As stated above, according to the clause 9 of the allotment letter, possession of the unit, in question, was to be delivered, to the complainants, within a period of 18 to 24 months, with a grace period of three months, from the date of issuance of the same (allotment letter) i.e. on or before 01.04.2015. Neither possession of the unit was offered nor delivered to the complainants, by the stipulated date for want of construction and basic amenities at the site, as has been frankly admitted by the opposite parties, in their written version nor the penalty amount, as provided in allotment letter, was paid to them nor the amount deposited by the complainants was refunded to them. There was, thus, a continuing cause of action, in favour of the complainants, to file the complaint. In Lata Construction & Ors. Vs. Dr. Rameshchandra Ramniklal  Shah And Anr., II 2000 (1) CPC 269=AIR 1999 SC 380, wherein, the facts and circumstances were similar to the one, involved, in the instant case, it was held that there was a continuing cause of action, and the complaint was not barred by time. In Meerut Development Authority Vs. Mukesh Kumar Gupta, IV (2012) CPJ 12 (SC),  the complainant applied for a plot, in the year 1992, on the basis of inducement made in the advertisements of the opposite party/builder. It was known to the opposite party that the land, in question, was under litigation. Consumer Complaint was filed, in the year 2009, claiming relief of execution of the sale deed, which was granted to him. An objection was taken that the complaint was barred by time. The Hon'ble Supreme Court held that there was a continuing cause of action, and, as such, the complaint was not barred by time. The principle of law, laid down, in the aforesaid cases, is fully applicable to the facts of the instant case. Under these circumstances, it is held that the complaint was not at all barred by time. The objection taken by the opposite parties, in this regard, being devoid of merit, must fail and the same stands rejected.  

17.         The objection taken by the opposite parties, to the effect that the complainants being investors, did not fall within the definition of a consumer, as defined by Section 2 (1) (d) (ii) of the Act, also deserves rejection. It may be stated here that there is nothing on the record, that the complainants are the property dealers and deal in the sale and purchase of property, on regular basis, and as such, the unit, in question, was purchased by them, by way of investment, with a view to resell the same, as and when, there was escalation in the prices thereof. Thus, in the absence of any cogent evidence, in support of the objection raised by  the  opposite parties, mere bald assertion i.e. simply saying that the complainants being investors, did not fall within the definition of a consumer, 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, 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. The complainants, thus, fall within the definition of a ‘consumer’, as defined under Section 2(1)(d) of the Act. Such an objection, taken by  the opposite parties, in their written reply, therefore, being devoid of merit, is rejected.  
18.         As far as the objection taken by the opposite parties, to the effect that the complaint is bad for non-joinder and misjoinder of party(s), is concerned, it may be stated here that the opposite parties failed to clarify, as to which party(s) was/were required to be added or deleted, in the head-note of the instant complaint. Such an objection taken by the opposite parties, in this regard, therefore, being without any justification, is rejected.
19.         Hard-earned money, deposited by the complainants, towards the unit, in question, was utilized by the opposite parties, for a number of years. The opposite parties by neither delivering physical possession of the unit, in question, complete in all respects, by the stipulated date, nor refunding the amount to the complainants, were not only deficient, in rendering service, but also indulged into unfair trade practice. The complainants, are, thus, entitled to the refund of Rs.50.50 lacs alongwith interest @12% p.a., from the respective dates of deposits.

                In view of above facts of the case, the opposite parties are also under an obligation to compensate the complainants, for inflicting mental agony and causing physical harassment to them, as also escalation in prices.

20.         Prayer of the complainants for payment of rent amount @Rs.10,000/- per month, for the period of delay, cannot be accepted. Once this Commission is ordering refund of amount paid with interest, leviable from the dates of respective deposits, relief qua grant of rent amount cannot be granted. If it is granted, it would amount to giving double benefit to the complainants. Prayer made by the complainants, to this extent is rejected.
21.         No other point, was urged, by Counsel for the parties.   
22.         For the reasons recorded above, this complaint is partly accepted, with costs. The opposite parties, jointly and severally, are directed as under:-

1. To refund the amount of   Rs.50.50 lacs to  the complainants,  alongwith simple interest @12% per annum, from the respective dates of deposits onwards.
2. To pay compensation, in the sum of Rs.2 lacs, 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.50,000/- to the complainants.
4.  The aforesaid awarded amounts, in the manner mentioned in clauses (i) to (iii), shall be paid by the opposite parties, to the complainants,  within a period of 2 months, from the date of receipt of a certified copy of this order, failing which, the amount mentioned in clause (i) shall carry penal interest @15% per annum instead of 12% per annum, from the respective dates of deposits till realization and the amounts mentioned in clauses (ii) and (iii) shall carry interest @15% per annum, from the date of filing of this complaint, till realization.

23.         However, it is made clear that, in case, the complainants, have availed loan facility from any banking/financial institution(s), it shall have the first charge of the amount payable, to the extent, the same is due to be paid by them (complainants).
24.         Certified Copies of this order be sent to the parties, free of charge.
25.         The files be consigned to Record Room, after completion.

Pronounced.

14.09.2016

Sd/-

 [JUSTICE JASBIR SINGH  (RETD.)]

PRESIDENT

 

 

Sd/-

[DEV RAJ]

MEMBER

 

Sd/-

 

(PADMA PANDEY)

        MEMBER

Rg.