Chandigarh

StateCommission

CC/323/2017

Neeraj Garg - Complainant(s)

Versus

BCL Homes Ltd. - Opp.Party(s)

Dhawal P.S. Ahluwalia, Adv.

23 Apr 2018

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Complaint No.	:	323 of 2017
Date of Institution	:	17.04.2017
Date of Decision	:	23.04.2018

 

1. Neeraj Garg son of Sh.Raghubir Kumar.
2. Seema Rani wife of Neeraj Garg.

Both resident of House No.1241, Gandhi Nagar, Punjab, presently residing at House No.335, 1^st Floor, Sector 12-A, Panchkula, Haryana.

…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 Directors Tajinder Kumar Bansal, Rajeev Kumar.
3. BCL Homes Ltd., through its Managing Director, Sh.Baldev Chand Bansal, 253, Sector 7, Panchkula, Haryana-134109
4. Canara Bank, Branch Office at Sector 8, Madhya Marg, Chandigarh, through its Branch Manager.

…..Opposite Parties

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

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

                        SH.DEV RAJ, MEMBER

                        MRS. PADMA PANDEY, MEMBER

 

Argued by:-       Sh.Dhawal Pratap Singh Ahluwalia, Advocate for the complainants.

Sh.Hitesh Verma, Advocate for opposite parties no.2 and 3.

Sh.Gaurav Gupta, Advocate for opposite party no.4.

Opposite party no.1 exparte.

 

PER JUSTICE JASBIR SINGH (RETD.), PRESIDENT

                It is case of the complainants that being allured by the promises of opposite parties no.1 to 3, they opted to purchase an apartment/flat (in short the unit) in a project, launched by them, under the name and style “Chinar Homes”, Kishanpura, Zirakpur, Mohali. They moved an application for allotment of a flat, on making payment of Rs.8 lacs, vide receipt dated 25.04.2014 Annexure C-1, towards booking amount. They were informed that total price of the unit will come to Rs.40 lacs.

2.         Allotment letter Annexure C-2 was issued on 25.04.2014, qua 3BHK flat bearing no.718, measuring 1440 square feet, 7^th  floor, in Tower 9 (in short the unit), in the said project. By 25.10.2015, as per demands raised by opposite parties no.1 to 3, from time to time, the complainants, in all, had deposited an amount of Rs.34,00,000/-, towards price of the said unit. It is case of the complainants that as per Clause 9 of the allotment letter, possession of the unit, in question, was to be delivered to them, by opposite parties no.1 to 3, 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. latest by 24.07.2016, after providing all the basic amenities. It was further stipulated in Clause 9 that, in case, opposite parties no.1 to 3, 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.
3.         It is further case of the complainants that they had been regularly visiting the project site and were shocked to see that there was no sign of progress of construction. When possession of the unit was not delivered as per the stipulated date, the complainants made requests to deliver the same, however, they were given only false assurances. It was surprising to know that there was no internal development at the site. Further, the tower in which built-up unit was situated was also not complete. It was further stated that opposite parties no.1 to 3 have violated the provisions of (PAPRA). It is further case of the complainants that they made visits to the site, in the years 2016 and 2017, but position remained the same. Request to make payment of compensation, on account of delay caused in handing over possession of the unit, was also not accepted by opposite parties no.1 to 3. It is positive case of the complainants that as per information gathered by them, opposite parties no.1 to 3 had defaulted in making repayment of loan raised from opposite party no.4. The bank had gone to the Competent Forum, to recover the said amount. It is further case of the complainants that to secure their rights, they approached Debt Recovery Tribunal. To say that development is lacking, photographs taken in the year 2016, have also been placed on record as Annexure C-3. These photographs clearly indicate that the construction is not complete.  It was averred that on account of act and conduct of parties no.1 to 3 in not completing construction of the unit and handing over possession thereof, the complainants are being forced to live in a rented accommodation, for which they are paying heavy rent, thereby causing financial loss to them.
4.         By stating as above, it is prayed that directions be issued to opposite parties No.1 to 3, to refund the amount paid alongwith interest. Additional prayer has been made to issue directions to the opposite parties No.1 to 3 to pay the amount of rent @Rs.10,000/- per month, for the delayed period. Besides above, compensation for mental agony & physical harassment alongwith litigation expenses was also claimed.
5.         Upon receipt of above complaint, notice was issued to the opposite parties. On 14.08.2017, Sh.Nitin Gupta, Advocate, put in appearance, on behalf of opposite party no.4 and sought time of file his vakalatnama, reply and evidence. Since, as per office note, notice sent to opposite parties no.1 and 3 could not be served, as such, they were ordered to be served, through email, which had been supplied by their Counsel, in other cases. The case was adjourned to 17.08.2017, on which date Sh.Hitesh Verma, Advocate, put in appearance on behalf of opposite parties no.2 and 3. He was asked to put in appearance, on behalf of opposite party no.1 also, but he said that he does not have any authority to represent it. Since none put in appearance, on behalf of opposite party no.1, as such, it was ordered to be proceeded against exparte. The case was adjourned to 11.09.2017, for filing reply and evidence, on behalf of opposite parties no.2 to 4. Ultimately, reply was filed on behalf of opposite parties no.2 and 3. However, opposite party no.4 did not prefer to file reply to the complaint, on the ground that no relief has been sought against it, by the complainants.  
6.         In the reply filed by opposite parties no.2 and 3, serious objections were raised qua territorial jurisdiction of this Commission. It was stated that the project, in which the flat purchased by the complainants is situated in Village Kishanpur, Zirakpur, Mohali, Punjab; sale consideration was also paid by the complainants, at that place; allotment letter was also signed at the said place, as such, this Commission at Chandigarh is not vested with territorial jurisdiction to entertain and decide this complaint. It was pleaded that in the face of existence of arbitration Clause no.22 in the Allotment Letter, to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of 1996 Act, this Commission has no jurisdiction to entertain the consumer complaint.   
7.         On merits, purchase of the unit, in question, by the complainants, for the price, as stated in earlier part of this order, is not disputed. Payments made were also not disputed. Issuance of Allotment Letter aforesaid, is admitted. It was also admitted that as per 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 (total 27 months), from the date of issuance of allotment letter i.e. on or before 24.07.2016, after providing all the basic amenities. It was stated that opposite parties no.2 and 3 are ready to make payment of delay compensation @Rs.10,000/- per month, for the period of delay, in offering possession of the unit, in question.  It was further stated that possession of the unit, could not be offered on account of force majeure circumstances, beyond the control of opposite parties no.2 and 3. However, no details qua that fact were provided in the written statement filed. No assurance was also made, as to within how much time, construction of the unit will be completed and possession is going to be delivered. It was averred that opposite parties no.2 and 3 are trying their level best to complete construction and offer possession of the units to the allottees including the complainants. It is pleaded that the complaint is barred by limitation. Remaining averments were denied being wrong.
8.         The contesting parties led evidence, in support of their case.
9.         We have heard Counsel for the contesting parties, and have gone through record of the case, very minutely.
10.         First, we will deal with an objection, raised by opposite parties no.2 and 3, that in the face of existence of provision to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of 1996 Act, this Commission has no jurisdiction to entertain the consumer complaint.

               This objection has been raised in the written statement filed by opposite parties no.2 and 3, by placing reliance on Clause 22 contained in the allotment letter. It may be stated here that this issue has already been dealt with, by this Commission, in a case titled as ‘Sarbjit Singh Vs. Puma Realtors Private Limited’, IV (2016) CPJ 126, while relying upon ratio of judgments of the Hon’ble Supreme Court, titled as Fair Air Engg. Pvt. Ltd. & another Vs. N. K. Modi (1996) 6  SCC 385, C.C.I Chambers Coop. Housing Society Ltd. Vs Development Credit Bank Ltd. (2003) 7 SCC 233, Rosedale Developers Private Limited Vs. Aghore Bhattacharya and others, (Civil Appeal No.20923 of 2013), Secretary, Thirumurugan Cooperative Agricultural Credit Society v. M. Lalitha (2004) 1 SCC 305 and United India Insurance Co. Ltd. Vs. M/s Pushpalaya Printers, I (2004) CPJ 22 (SC),  and LIC of India and another Vs. Hira Lal, IV (2011) CPJ 4 (SC), and held that even in the face of existence of arbitration clause in an Agreement/Allotment Letter, to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of 1996 Act, this Commission has jurisdiction to entertain the consumer complaint. Recently, the larger Bench of the National Commission in a case titled as Aftab Singh  Vs. Emaar MGF Land Limited & Anr., Consumer Case No. 701 of 2015, vide order dated 13.07.2017, has held that an Arbitration Clause in the Agreements between the complainants and the Builder cannot circumscribe the jurisdiction of a Consumer Fora, notwithstanding the amendments made to Section 8 of the Arbitration Act. Feeling aggrieved against the said findings, the builder filed Civil Appeal bearing No.23512-23513 of 2017 before the Hon’ble Supreme Court of India, which was dismissed vide order dated 13.02.2018.

                In view of the above, the objection raised by opposite parties no.2 and 3, in this regard, being devoid of merit is rejected.

11.         Now we will deal with another objection raised by opposite parties no.2 and 3, to the effect that since the unit, in question, is situated at Mohali, Punjab, and also all the payments were received at Village Kishanpura, at the project site, as such, this Commission has got no territorial jurisdiction to entertain and decide the complaint.

                After taking notice of provisions of Section 17 (2) (a) and (c) of the Act, the objection raised needs rejection. Relevant provisions reads thus:-

“Section 17 in the Consumer Protection Act, 1986

17.  [(2) A complaint shall be instituted in a State Commission within the limits of whose jurisdiction,—

(a) the opposite party or each of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain; or

(b) …………………..

(c) the cause of action, wholly or in part, arises.]”

 

                It is specifically stated that a complainant can file a complaint in the State commission, within the limits of whose jurisdiction, the opposite party(s) actually and voluntarily resides or carries on business. It is evident from the payment receipts at pages 21 to 25 of the file, that the same have been issued by Registered Office of the opposite parties no.1 to 3, situated at Chandigarh i.e. Shop No.140, Railway Road, Village Dariya, U.T., Chandigarh. On the remaining payment receipts placed on record by the complainants, only correspondence address has been mentioned as Village Kishanpura, NAC Zirakpur, District Mohali, Punjab, meaning thereby that this address was meant for making any correspondence between the parties, whereas, the payments in respect of the unit, in question, were received by Registered Office of the Company, at Chandigarh only. In view of above, it can easily be said that the Company is running its business from the said place at Chandigarh. Since it is an admitted fact that payments, referred to above, towards the unit, in question, were received at Registered Office of opposite parties no.1 to 3, at Chandigarh, this Commission has got territorial jurisdiction to entertain the present complaint, in view of the provisions of Section 17 (2) (a) and (c) of the Act and also principle of law laid down by Hon’ble National Commission in Meera Chaudhary  Vs. M/s. M-Tech Developers Ltd., Ravinder Kumar Bajaj Vs. Parsvnath Developers Pvt. Ltd. & 3 Ors., First Appeal No. 2317 of 2017, decided on 06 March 2018, wherein it was observed as under:-

“………It is not in dispute that the Registered Office of the Respondent/Opposite Party is in New Delhi; the allotment letter to the Complainant was issued from the Respondent’s Office at New Delhi; and receipts, acknowledging deposit of the demand drafts towards the sale consideration, were issued in New Delhi.

In view of the said overwhelming documentary evidence on record, in the light of the plain language of Section 17(2)(a) of the Consumer Protection Act, 1986, there can hardly be any doubt that the Delhi State Commission did have the territorial jurisdiction to entertain the Complaint ……………”.

 

                In view of above, this Commission has got territorial Jurisdiction to entertain and decide this complaint.  Objection taken by opposite parties no.2 and 3, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected. 

12.         It is proved on record that the complainants have purchased a built-up unit, referred to above, for an amount of Rs.40 lacs, in a project launched by parties no.1 to 3. Allotment Letter/Agreement, in this case was signed between the parties on 25.04.2014. As stated above, as per Clause 9 of the Allotment Letter, it was committed by opposite parties no.1 to 3 that possession of the unit, in question, was to be delivered to the complainants, on or before 24.07.2016, after providing all the basic amenities, subject to force majeure circumstances. It was further committed vide the said Allotment Letter that, in case, opposite parties no.2 and 3, 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.

                It is virtually admitted on record that till today, no offer has been made to hand over possession of a constructed unit by parties no.1 to 3 to the complainants. Rather, parties no.1 to 3 are still saying that they are making efforts to complete construction and offer possession of the built-up unit to the complainants. This appears to be a vague assurance, as no cogent and convincing evidence has been placed on record, to convince this Commission, regarding this fact. 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.”

 

13.         Not only as above, in another similar case, titled as Rajesh Kumar Nagpal Vs. BCL Homes Ltd. and ors., CC No.724 of 2016, decided by this Commission, on 07.02.2017, 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, which fact was never brought to the notice of the buyers at the time of selling it (project). Under those circumstances, the Commission, while holding the builder/opposite parties deficient on this score, observed as under:-

“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/opposite party no.4. 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. This act of opposite parties no.1 to 3, in committing default in repayment of loan, in no manner can be termed as force majeure circumstances, and as such, they cannot claim any immunity, under the said plea. Even otherwise, the complainant has no concern, whatsoever, with the dispute, if any, arose between opposite parties no.1 to 3 and opposite party no.4/Canara Bank (third party, with which there is no privity of contract with the complainant). 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 complainant. It is on record that despite request made by the complainant, through legal notice dated 31.08.2016 (through registered post) to refund the amount with interest thereon, even reply was not given by opposite parties no.1 to 3. Above facts clearly amounted to deficiency in providing service on the part of opposite parties no.1 to 3, which entitles the complainant to get refund of amount paid by him, towards the unit”.

Under above facts, it is held that by not handing over possession of the unit, by the stipulated date, or even as on today, parties no.1 to 3 are deficient in providing service and also guilty of adoption of unfair trade practice.

14.         As far as plea taken by parties no.2 and 3 to the effect that delay in handing over possession of the unit to the complainant, took place on account of force majeure circumstances beyond the control of the Company, it may be stated here that except taking such a vague plea, nothing cogent and convincing evidence has been placed on record by opposite parties no.2 and 3, in this regard. Under these circumstances, it can safely be said that such a plea has been taken by opposite parties no.2 and 3, for the first time, in the written statement, just with a view to escape from their liability, which is not sustainable in the eyes of law and is accordingly rejected.
15.         Further objection taken by opposite parties no.2 and 3, that the complaint filed by the complainants is barred by time, also stands rejected in view of the reasons that since it is an admitted fact that neither possession of the unit was offered nor delivered to the complainants, by the stipulated date, or even till date,  for want of construction and basic amenities at the site, nor the penalty amount, as provided in allotment letter, was paid to them nor the amount deposited was refunded to them, as such, there is continuing cause of action, in favour of the complainants, to file this 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.
16.         Hard-earned money, deposited by the complainants, towards the unit, in question, was utilized by parties no.1 to 3, for a number of years. The opposite parties, by neither delivering possession of the unit, in question, complete in all respects, by the stipulated date or even till date, nor refunding the deposited 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 amount paid, alongwith interest, from the respective dates of deposits.

                In view of above act and conduct of the opposite parties no.1 to 3, they are also under an obligation to compensate the complainants, for inflicting mental agony and causing physical harassment to them, as also escalation in prices.

17.         At the same time, it is held that once this Commission has come to the conclusion that the complainants are entitled to get refund of the amount deposited alongwith interest and compensation, as such, the plea taken by opposite parties no.2 and 3 that the Company is ready to pay compensation amount to the tune of Rs.10,000/- per month, for the period of delay, is rendered infructuous. Had the complainants sought possession of the unit, in question, the matter would have been different. The plea of opposite parties no.2 and 3, in this regard, stands rejected.  

                Similarly, the complainants are also not held entitled to the said amount of Rs.10,000/- per month, for the period of delay in handing over possession of the unit, in question, because they have sought refund of the amount paid, which is being ordered to be refunded alongwith interest, compensation, etc., which will take care of financial loss, suffered by them. Prayer made by the complainants, in this regard, stands rejected. 

18.         No other point was urged by the contesting parties.
19.         For the reasons recorded above, this complaint is partly accepted, with costs. Opposite parties no.1 to 3, jointly and severally are directed as under:-

1. To refund the amount of   Rs.34 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.1,50,000/- 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.33,000/- to the complainants.
4. The aforesaid awarded amounts, in the manner mentioned in clauses (i) to (iii), shall be paid within a period of 45 days, 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 @12% per annum, from the date of filing of this complaint, till realization.

20.         However, it is made clear that, if the complainants have availed loan facility from any Bank or financial institution for making payment towards price of the said flat, it shall have the first charge of the amount payable, to the extent, the same is due to be paid by them (complainants).
21.         Complaint against opposite party no.4 stands dismissed with no order as to cost.
22.         Certified Copies of this order be sent to the parties, free of charge.
23.         The file be consigned to Record Room, after completion.

Pronounced.

23.04.2018

Sd/-

[JUSTICE JASBIR SINGH (RETD.)]

PRESIDENT

 

 

Sd/-

(DEV RAJ)

MEMBER

 

 

Sd/-

(PADMA PANDEY)

        MEMBER

Rg.