Chandigarh

StateCommission

CC/242/2016

Bhartvir Singh - Complainant(s)

Versus

Emaar MGF Land Limited - Opp.Party(s)

Rameet Bakshi, Abnash Singh, Adv.

31 Aug 2016

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Complaint case No.	:	242 of 2016
Date of Institution	:	30.05.2016
Date of Decision	:	31.08.2016

Bhartvir Singh S/o Mohinderpal Singh, r/o Flat No.316, Exotica Heights, Peer Muchalla, Adjoining Sector 20, Panchkula, Zirakpur – 140604, Punjab.

……Complainant

V e r s u s

Emaar MGF Land Limited, SCO No.120-122, Sector 17-C, Chandigarh – 160017, through its Managing Director.
Emaar MGF Land Limited, ECE House, #28, Kasturba Gandhi Marg, New Delhi, 110001, through its Director.

.... Opposite Parties

BEFORE: JUSTICE JASBIR SINGH (RETD.), PRESIDENT

MR. DEV RAJ, MEMBER.

MRS. PADMA PANDEY, MEMBER

Argued by:

Ms. Rameet Bakshi, Advocate for the complainant.

Sh. Ashim Aggarwal, Advocate for the Opposite Parties.

PER PADMA PANDEY, MEMBER

The facts, in brief, are that the Opposite Parties launched their project in the name of Mohali Hills, Sector 109, Mohali, Punjab. The complainant vide application No.2993 applied for allotment of a plot measuring 300 sq. yards in the project of the Opposite Parties and the total sale price of the plot was Rs.49,53,300/- including the EDC. The complainant paid the booking amount of Rs.5 lacs vide receipt dated 08.08.2012 (Annexure C-1 colly.). The Opposite Parties allotted plot bearing No.109-AG-225-300 to the complainant. Thereafter, Plot Buyers Agreement was executed between the parties on 01.09.2012 (Annexure C-2). It was further stated that as per Clause 8 of the Agreement, the Opposite Parties were to hand over physical possession of the plot, within a period of 18 months from the date of execution of the Agreement and further, in the event, the Company fails to deliver the possession within 21 months from the date of execution of the Agreement, without existence of any force majeure event or reason beyond the control of the Company, they would be liable to pay a penalty of Rs.50/- per sq. yard per month for the period of delay, beyond 21 months, from the date of execution of the Agreement. It was further stated that the complainant paid the total amount of Rs.47,32,800/- to the Opposite Parties in respect of the plot, in question. Copies of the receipts, cheques, demand drafts are Annexure C-4 (colly.). It was further stated that the complainant made the entire payment as per the requirement of schedule of payment (Annexure C-3). It was further stated that the Agreement was executed between the parties on 01.09.2012 and as per the terms and conditions of the Agreement, the plot should have been offered for possession to the complainant by 28.02.2014 and not later than by 31.05.2014 but the Opposite Parties failed to do so. It was further stated that when the complainant demanded compensation for delay, the Opposite Parties replied that the compensation was to be granted at the time of registration of the unit. It was further stated that the complainant also paid excess EDC charges to the tune of Rs.3 lacs but the Opposite Parties failed to refund the same, despite repeated requests. It was further stated that the complainant visited the site on 07.12.2014 and found that there was no development at the site, as no connectivity of road and no street lights were available. It was further stated that the complainant received a call from the office of the Opposite Parties on 18.12.2014 stating that possession letter for the unit had been dispatched on 12.12.2014 but no possession letter had been received by him, as was informed to the Opposite Parties through email dated 19.12.2014. The Opposite Parties sent an email on 15.01.2015 to the complainant stating that his case was approved for extension of the due date, as such, the complainant made no default in payment. It was further stated that the complainant sent an email to the Opposite Parties on 19.05.2015 stating that he received a call from their office intimating him that the approaching roads to his unit has been completed, therefore, all the dues be cleared by him. It was further stated that the complainant clarified that neither he received any demand letter nor he was aware about the dues that he had to pay. It was further stated that the complainant time and again requested the Opposite Parties for possession of the plot, however, the Opposite Parties stated that possession has already been offered to him. It was further stated that there was no proof of delivery attached with the said email, rather there was only a copy of courier receipt, which itself is incomplete as it does not even contain the address of the complainant and also there was no signatures of the complainant therefore, the receipt holds no evidentiary value of delivery. It was further stated that the Opposite Parties failed to place on record any registered cover AD, which could prove that the complainant received the said possession letter. It was further stated that the Opposite Parties sent an email dated 12.12.2014 to the complainant, in which, it was stated that development work was expected to be complete in 3-4 months, subsequent to which, possession would be offered. Ultimately, the complainant requested for refund of the amount, which was duly replied by the Opposite Parties vide email dated 11.05.2016 that possession has been offered and it is not possible to refund the money to the complainant. It was further stated that the complainant took the loan from HDFC Bank in respect of the plot, in question. It was further stated that the Opposite Parties failed to develop the site, as is evident from photographs (Annexure C-6 colly.). It was further stated that a number of communication through emails were exchanged between the complainant and the Opposite Parties, as mentioned in para No.5 of the complaint. It was further stated that the aforesaid acts, on the part of the Opposite Parties, amounted to deficiency, in rendering service, and indulgence into unfair trade practice. When the grievance of the complainant, was not redressed, left with no alternative, a complaint under Section 17 of the Consumer Protection Act, 1986 (in short the ‘Act’ only), was filed.

2. The Opposite Parties, in their joint written version, have not taken objection regarding arbitration clause in the Agreement, and they separately, moved an application u/s 8 of Arbitration and Conciliation Act, 1996 taking a specific objection in this regard for referring the matter to the Arbitrator in terms of the agreed terms and conditions of the Agreement. It was further stated that it is well settled principle of law that in cases of sale of immovable property and construction, time is never regarded as the essence of the contract. Thus, complainant is not entitled to claim immediate possession within any time bound manner as the same would amount to specific performance of the contract. It was further stated that as per Clause 8 of the Agreement, the Company should make every endeavour to deliver possession of the plot to the allottee(s) within a period of 18 months from the date of execution of the Agreement and if they failed to deliver possession of the plot without existence of any force majeure event or reason beyond the control of the Company within 21 months from the date of execution of the Agreement, the Opposite Parties should be liable to pay to the allottee a penalty of a sum of Rs.50/- per sq. yard per month for such period of delay beyond 21 months from the date of execution of the Agreement. Thus, there is no definitive Agreement stating that possession would definitely be delivered within 21 months. It was further stated that the Opposite Parties already offered possession of the plot and a letter has already been sent to the complainant. It was further stated that the Opposite Parties even sent the communication through emails and confirmed the same. It was further stated that the complainant filed the complaint after nearly 1 ½ years from the date of offer of possession and he failed to remit the balance amount. It was further stated that in case the complainant seeks refund, at this stage, the forfeiture clause would be applicable. It was further stated that the Opposite Parties sent intimation of possession on 12.12.2014 and copy of the said letter alongwith proof of dispatch are Exhibit OP/2 (colly.) but he failed to take the possession, for the reasons best known to him. It was further stated that this Commission has no pecuniary jurisdiction to entertain the complaint, as relief claimed including interest exceeds Rs.1.00 crore. It was further stated that the total sale consideration of the plot was Rs.49,53,300/-, out of which, the complainant paid an amount of Rs.47,32,800/-, as is evident from the statement of account (Exhibit OP/3). It was further stated that the complainant still has to pay an outstanding amount of Rs.5.85 lacs principal plus Rs.53,898/- as delayed payment charges. It was further stated that the compensation, if any, would be credited to the account of the complainant subject to completion of possession formalities. It was further stated that the excess EDC has already been adjusted towards the total amount payable. It was further stated that the Opposite Parties responded to the complainant on 27.05.2015 stating that the road was completed in front of his plot but he never visited the site nor made payments, as per schedule. It was further stated that neither there was any deficiency, in rendering service, on the part of the Opposite Parties, nor they indulged into unfair trade practice.

3. The complainant, filed rejoinder to the written statement of the Opposite Parties, wherein he reiterated all the averments, contained in the complaint, and refuted those, contained in the written version of the Opposite Parties.

4. The Parties led evidence, in support of their case.

5. We have heard the Counsel for the parties, and have gone through the evidence and record of the case, carefully.

6. Admittedly, Plot Buyer’s Agreement in respect of plot/unit bearing No.109-AG-225-300 was executed between the parties on 01.09.2012 (Annexure C-2). It is also the admitted fact that the total sale consideration of the plot was Rs.49,53,300/-, out of which, the complainant made the total payment of Rs.47,32,800/-, as stipulated from statement of account (Exhibit OP/3).

7. The first question that falls for consideration is, as to whether, in the face of existence of arbitration clause in the Agreement, to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of Arbitration Act 1996, this Commission has no jurisdiction to entertain the present complaint. It may be stated here that the objection raised by the Opposite Parties, in this regard, deserves rejection, in view of the judgment passed by this Commission in Abha Arora Vs. Puma Realtors Pvt. Ltd. and another, consumer complaint No.170 of 2015, decided on 01.04.2016, wherein this issue was dealt, in detail, while referring various judgments of the Hon'ble Supreme Court of India; the National Commission, New Delhi, and also Section 3 of the Consumer Protection Act, 1986. Ultimately it was held by this Commission that even i n the face of existence of arbitration clause in the Agreement, 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. It was also so said by the National Commission, recently, in a case titled as Lt. Col. Anil Raj & anr. Vs. M/s. Unitech Limited, and another, Consumer Case No. 346 of 2013, decided on 02.05.2016. Relevant portion of the said case, reads thus:-

“In so far as the question of a remedy under the Act being barred because of the existence of Arbitration Agreement between the parties, the issue is no longer res-integra. In a catena of decisions of the Hon’ble Supreme Court, it has been held that even if there exists an arbitration clause in the agreement and a Complaint is filed by the consumer, in relation to certain deficiency of service, then the existence of an arbitration clause will not be a bar for the entertainment of the Complaint by a Consumer Fora, constituted under the Act, since the remedy provided under the Act is in addition to the provisions of any other law for the time being in force. The reasoning and ratio of these decisions, particularly in Secretary, Thirumurugan Cooperative Agricultural Credit Society Vs. M. Lalitha (Dead) Through LRs. & Others - (2004) 1 SCC 305; still holds the field, notwithstanding the recent amendments in the Arbitration and Conciliation Act, 1986. [Also see: Skypak Couriers Ltd. Vs. Tata Chemicals Ltd. - (2000) 5 SCC 294 and National Seeds Corporation Limited Vs. M. Madhusudhan Reddy & Anr. - (2012) 2 SCC 506.] It has thus, been authoritatively held that the protection provided to the Consumers under the Act is in addition to the remedies available under any other Statute, including the consentient arbitration under the Arbitration and Conciliation Act, 1986.”

In view of the above, and also in the face of ratio of judgments, referred to above, passed by the National Commission and this Commission, the arguments raised by Counsel for the Opposite Parties, stands rejected.

8. Another objection taken by the Opposite Parties, with regard to pecuniary jurisdiction, also deserves rejection. It may be stated here, that the complainant has sought refund of an amount of Rs.47,32,800/- paid by him, towards price of the plot, alongwith compound interest @18% p.a. from the respective dates of deposits ; refund the excess amount of EDC charged to the tune of Rs.3 lacs ; pay interest on loan amounting to Rs.8,40,171/- ; compensation to the tune of Rs.7 lacs, for mental agony & physical harassment; and cost of litigation, to the tune of Rs.33,000/-, aggregate value whereof [excluding the interest claimed] fell above Rs.50 lacs and below Rs.1 crore. Thus, this Commission has got pecuniary Jurisdiction, to entertain and decide the complaint.

As far as the interest claimed by the complainant, on the deposited amount is concerned, it is not required to be added, at this stage, to the value of the reliefs claimed, for determining the pecuniary Jurisdiction of this Commission, in view of law laid down by three Member Bench of the National Commission, in a case titled as Shahbad Cooperative Sugar Mills Ltd. Vs. National Insurance Co. Ltd. & Ors. II (2003) CPJ 81 (NC), wherein it was clearly held that since rate and the period for which interest has to be allowed, is within the discretion of Consumer Foras, and that too at the stage, when the complaint is finally disposed of, as such, the same being imaginary would not be taken into consideration, at the time of filing of the same (complaint), for the purpose of determination of pecuniary jurisdiction. Not only as above, in the case of Denis Exports Pvt. Ltd Vs. United India Insurance Co. Ltd, Consumer Case No. 196 of 2016, decided on 08 March 2016, it was clearly held by the National Commission that interest component being imaginary, will not be added in the reliefs sought by the consumers, for determining pecuniary jurisdiction of the Consumer Foras. The principles of law, laid down, in the cases referred to above, are fully applicable, to the facts of the instant case. In view of the above, the objection taken by the Opposite Parties, that this Commission lacks pecuniary Jurisdiction, being devoid of merit, must fail and the same stands rejected.

9. Another objection raised by Counsel for the Opposite Parties that since it was mentioned in the Agreement that the Company shall endeavour to deliver possession of the plot within maximum period of 21 months, as such, time was not the essence of contract, is also devoid of merit. It may be stated here that it was clearly mentioned in Clause 8 of the Agreement that possession of the plot will be delivered by the Opposite Parties, within a period of maximum 21 months, subject to force majeure circumstances or reason beyond the control of the Opposite Parties. In the instant case, the Opposite Parties did not raise any force majeure circumstances, if any, encountered by them. In the absence of any force majeure circumstances having been faced by the Opposite Parties or any other valid and legal reason beyond their control, the stand taken by them, in this regard, for condonation of delay in delivery of possession of the unit, to the complainant, cannot be taken into consideration. Thus, under these circumstances, since as per Clause 8 of the Agreement, the Opposite Parties were bound to deliver possession of the unit, within a maximum period of 21 months from the date of execution of the same, as such, time was, unequivocally made the essence of contract.

Even otherwise, the Opposite Parties cannot evade their liability, merely by saying that since the word tentative/ proposed/tentative was mentioned in the Agreement, for delivery of possession of the unit, as such, time is not to be considered as essence of the contract. Non-mentioning of exact date of delivery of possession of the unit(s) in the Buyer’s Agreement, 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 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 also stands rejected.

10. The next question, that falls for consideration, is, whether the Opposite Parties rightly intimated about offer of possession to the complainant. According to the Opposite Parties, possession has been offered to the complainant vide letter dated 12.12.2014 (Exhibit OP/2), after completion of all the amenities, as per terms of the Agreement, which was sent through courier. The Opposite Parties have also placed on record proof of delivery i.e. courier receipt (at page No.131 of the file). As per the Opposite Parties, the complainant was well aware of possession being offered and dispatch of letter. The Opposite Parties, in their written statement, has stated that copy of intimation of possession letter again sent to the complainant with proof of dispatch receipt, as is evident from page Nos. 83 to 85 of the complaint.

After going through the record, we are of the view that the alleged intimation of possession dated 12.12.2014 sent by the Opposite Parties to the complainant through courier “Overnite Express Limited” is just an eyewash because on the same date, the Opposite Parties sent an email to the complainant mentioning that “Development in the concerned area is being expedited and the same is expected to be complete in 3-4 months, subsequent to which they shall be offering the possession of the unit” (at page no.97 of the complaint). Even the courier receipt (at page No.131 of the file), placed on record by the Opposite Parties, to prove that intimation of offer of possession, vide letter dated 12.12.2014 (Exhibit OP/2) in respect of plot No.109-AG-225-300 in Block AG , situated at Sector 109, Mohali Hills (Project) was sent to the complainant through courier i.e. Overnite Express Limited. A bare perusal of the courier receipt annexed by the Opposite Parties clearly reveals that neither the address of the complainant nor the signatures of the complainant contained in the aforesaid courier receipt. Moreover, the complainant has specifically denied regarding the receipt of intimation of possession letter. Even the Opposite Parties have failed to place on record any document, which could show that they sent intimation of offer of possession dated 12.12.2014 through Regd. Cover AD or speed post. It is relevant to mention here that that in Clause 38 and 39 of the Plot Buyer’s Agreement (Annexure C-2), specified the mode of service of notice to each other has been mentioned, which is reproduced thus :-

“38. All notices referred to in this Agreement shall be in writing and shall be deemed to be properly given and served on the party to whom such notice is to be given if sent either by registered A.D. post or speed A.D. post to the Party at their respective addresses specified below : …..”

39. It shall be the duty of the Allottee(s) to inform the Company of any change subsequent to the execution of this Agreement in the above address by registered/speed post A.D. failing which all communications and letters posted at the above address shall be deemed to have been received by the Allottee(s).”

Therefore, as per the specific clauses, reproduced above, of the Agreement clearly indicated that courier receipts do not hold any evidentiary value. So, it is clearly proved that the plea of the Opposite Parties regarding intimation of offering of possession, has no force, at all, and thus, rejected.

11. The next question, that falls for consideration, is, as to within which period, the delivery of possession of the unit, was to be given to the complainant. According to Clause 8 of the Plot Buyer’s Agreement (Annexure C-2), subject to force majeure conditions and reasons, beyond the control of the Opposite Parties, they were to deliver possession of the unit, in question, within a maximum period of 21 months, from the date of execution of the Agreement i.e. latest by May/June, 2014. However, the Opposite Parties failed to give physical possession of the unit, in question, to the complainant, despite repeated requests within the specified time frame, as mentioned in the Agreement. Even the intimation of offer of possession, as alleged by the Opposite Parties, was not sent in right mode of delivery to the complainant. Moreover, the Opposite Parties already received a huge amount of Rs.47,32,800/-, towards the said unit, as is evident from the statement of account (Exhibit OP/3), out of the total consideration of Rs.49,53,300/-. By making a misleading statement, that possession of the unit, was to be delivered within a maximum period of 21 months, from the date of execution of the Agreement, the Opposite Parties failed to abide the commitments, as such, they were not only deficient, in rendering service, but also indulged into unfair trade practice.

12. The next question, that falls for consideration, is, as to whether, the complainant is entitled to refund of the amount of Rs.47,32,800/-, deposited by him. It is an admitted fact that the Opposite Parties are unable to deliver possession of the unit, in question, within the specified time frame, as mentioned in the Agreement and firm date of delivery of possession of the unit, could not be given to him (complainant). The complainant cannot be made to wait for an indefinite period, for delivery of actual physical possession of the plot purchased by him. The Opposite Parties, therefore, had no right, to retain the hard-earned money of the complainant, deposited towards price of the unit, in question. The complainant is thus, entitled to get refund of amount deposited by him. In view of above facts of the case, the Opposite Parties are also under an obligation to compensate the complainant, for inflicting mental agony and causing physical harassment to him.

13. As far as the plea taken by the Opposite Parties that if the complainant seeks refund, forfeiture clause would be applicable is concerned, it may be stated here that the same stands rejected, because it is not their (Opposite Parties) case, that they were ready with possession of the plot, to be delivered to the complainant, by the stipulated time frame, as mentioned in the Agreement but it was he (complainant) who wanted to rescind the contract, on account of some unavoidable circumstances/ financial constraints or due to deficiency in service rendered by the Opposite Parties and is seeking refund of the amount deposited. In this view of the matter, the plea taken by the Opposite Parties, in this regard, has no legs to stand and is accordingly rejected.

14. The next question, that falls for consideration, is, as to whether, the complainant is entitled to interest, on the amount of Rs.47,32,800/-, if so, at what rate. The complainant was deprived of him hard earned money, to the tune of Rs.47,32,800/-, on the basis of misleading information, given by the Opposite Parties, that they would be handed over legal physical possession of the unit, in question, within a maximum period of 21 months from the execution of the Agreement. However, the Opposite Parties failed to deliver physical possession of the unit to the complainant, within the stipulated time frame, as mentioned in the Agreement. The complainant was, thus, caused financial loss. Hard earned money, deposited by the complainant, towards price of unit, in question, was utilized by the Opposite Parties, for a number of years. Had this amount been deposited by the complainant, in some bank, or had he invested the same, in some business, he would have earned handsome returns thereon. It is therefore, held that the Opposite Parties, by neither delivering possession of the unit, by the stipulated date, nor refunding the amount to the complainant, were not only deficient, in rendering service, but also indulged into unfair trade practice. No doubt, as per Clause 3 of the Plot Buyer’s Agreement, the Opposite Parties were charging interest @24% per annum compounded quarterly from the complainant. Under these circumstances, in our considered opinion, if interest compounded quarterly @15%, on the amount deposited by the complainant, from the respective dates of deposits, is granted, that will serve the ends of justice.

15. With regard to interest on loan amounting to Rs.8,40,171/- and excess EDC, as claimed by the complainant, is concerned, the complainant in the present case sought refund and not the possession. Since we are refunding the whole deposited amount to the complainant alongwith interest and compensation, therefore, he is not entitled to the other reliefs, as claimed by him.