PER MR SUBHASH CHANDRA

1.     This complaint has been filed under section 21 (a) (i) of the Consumer Protection Act, 1986 (in short, the ‘Act’) alleging deficiency in service and unfair trade practice in respect of an office space booked by them with the opposite party viz., Emaar MGF Land Ltd & Ors., in a project promoted and developed by it and seeking refund of the amount deposited along with interest and other compensation.

2.     Briefly, the facts of the case are that the complainant had applied for allotment of office space in Digital Green Complex, Sector 61, Urban Estate, Gurgaon, Haryana (in short, the ‘project’) being developed and promoted by the opposite party and were allotted unit number DG-B-17-016 in Tower B. The purpose was to set up an office for personal work. The sale consideration was Rs.1,14,18,031/- as per a payment plan of 94% towards the unit price and 100% towards parking space within 60 days of booking and the balance at the time of possession, along with IFSD/IFMS, stamp duty and registration.  The complainant submits that Rs.1,05,48,106.50 was paid between 14.09.2010 and 03.01.2011 and Rs.2,55,861.18 was paid on 15.01.2012 amounting to a total of Rs 1,08,03,967.60.

3.     On 25.02.2011 a Buyer’s Agreement (in short, the ‘Agreement’) was executed between the parties. As per clause 16(a)(i) of the Agreement possession was assured within 18 months i.e. by August 2012 or by 25.12.2012 with 4 months of grace period. As possession was not offered by the committed date despite efforts with the opposite party, the complainant sent a legal notice on 06.12.2016 seeking possession with interest on the amount deposited. On 29.12.2016 the opposite party admitted receipt of Rs.1,08,03,967.64 as payment consideration. Complainant has claimed that the opposite party failed to provide possession of the property booked even after 5 years and 9 months despite receipt of 94% sale consideration which constitutes deficiency of service under section 2(g) and unfair trade practice under section 2(nnn) and (r) of the Act. The complainant has approached this Commission with the following prayer:

        (i)     Allow the present complaint;

(ii)     Opposite party no.1 be directed to pay Rs.63,30,607.15 for delay in possession of the impugned property;

(iii)    The opposite party no.1 is directed to compensate the complainant of Rs.10,00,000/- towards mental harassment, frustration and agony;

(iv)    The opposite party no.1 be directed to compensate the complainant of Rs.5,00,000/- towards litigation costs and other expenses; and

(v)     Any other relief that this Hon’ble Forum may deem fit in the facts and circumstances of the case and in the interest of justice.

4.     The complaint has been contested by the opposite party by way of a reply/written version. All averments of the complainant have been denied and preliminary objections have been taken on the basis of pecuniary jurisdiction since Rs.63,30,607.15 has been claimed for delay in possession, Rs.10,00,000/- for mental harassment and Rs 5,00,000/- towards litigation costs making an aggregate claim of Rs 78,30,607.15. Reliance is placed upon this Commission’s orders in Sujata Nath Vs. Popular Nursing Home & Ors. III (2011) CPJ 239 (NC) and Indrani Chatterji Vs. AMRI Hospitals Manu/CF/0687/2014. It is contended that the complaint is not maintainable in view of clause 35 of the Agreement providing for arbitration in case of dispute. The complaint is also barred by limitation under section 24A of the Act since no condonation has been sought for the complaint which is dated 17.02.2017, after 2 years of the expiry of the period of limitation. Misjoinder of unnecessary parties is also alleged relating to opposite parties 2, 3 and 4. It is contended that the opposite party has obtained Occupation Certificate from the competent authority on 20.03.2017 and conveyed intimation of possession to the complainant on 30.06.2017 and demanded the balance amount of Rs.15,77,629/-.

5.      It is contended that the complainant is not a ‘consumer’ under the Act but an investor for speculative purposes. It is claimed that as per the judgment of the Hon’ble Supreme Court in Chief Administrator, HUDA & Anr. Vs. Shakuntala Devi in CA No 7335 of 2008 that compensation can be awarded under section 14(1)(d) only if the loss or injury to the complainant is established due to negligence of the opposite party. It is also claimed that compensation has to be computed on a rational basis based on evidence produced as held by this Commission in Lakshmi Cotton Traders Ltd. Vs. CWC 3 (1996) CPJ 22 and that while compensation is just equivalent for loss, it cannot be a bonanza or a source of profit as held by the Hon’ble Apex Court in Ghaziabad Development Authority Vs. Balbir Singh JT 2004(5) SC 17. It is contended that the parties are bound by the unchallenged terms of the contract as per judgment of the Hon’ble Supreme Court in Secretary, Bhubaneswar Development Authority Vs. Susanta Kumar Mishra V (2009) SLT 242 and Bharati Knitting Company Vs. DHL Worldwide Express Courier Airfreight Ltd. II (1996) CPJ 25 (SC).

6.     Parties led their evidence. Written synopses of arguments were also filed by both the parties. We have heard the learned counsel for the parties and given thoughtful consideration to the documents and evidence on record.

7.     Learned counsel for the complainant submits that the opposite party had made an offer of possession on 05.03.2018 and possession was taken in Jan/Feb 2022. It is contended on the basis of this Commission’s order dated 10.01.2012 in Meerut Development Authority Vs. M.K. Gupta, RP 3656 of 2011 and in Satish Kumar Pandey Vs. Unitech Ltd. dated 14.07.2015 in CC 427 of 2014 that failure to deliver possession is a continuous wrong and constitutes a recurring cause of action. It is also submitted that as ordered by this Commission in Shamshul Hoda Khan Vs. Ireo Victory Valley Pvt. Ltd. & Ors., in CC 2110 of 2016 on 17.01.2019 that any balance amount due from the complainant shall be adjusted by the opposite party out of the compensation payable.

8.     On behalf of the complainant it is argued that during the pendency of the complaint, he received a copy of Form 16A dated 01.03.2018 from the Income Tax Department indicating that opposite party no. 1 had deposited an amount of Rs.4,23,948/- as tax deducted at source against payment of Rs.42,39,480/- which, upon enquiry, was found to be towards compensation for delay in grant of possession of the flat. It is averred that the compensation for delay is therefore admitted. The deposit of tax added tax liability to the complainant’s income without there actually being an increase in his income for the financial year 2017-18. Even this calculation is averred to be not correct as it was computed for the period 25.02.2011 till 20.03.2017 or 4.35 years whereas it should have been for 6.1 years from the date of Agreement to the date of offer of possession. It is also stated that the letter of offer of possession is 05.03.2018 and not 31.05.2017 as is evident from the emails on the subject. Therefore compensation by the opposite party as also all charges to be paid by the complainant need to be reckoned upto 05.03.2017. On 11.02.2019 the opposite party also intimated the complainant to take possession along with an additional amount of Rs 9.8 lakhs towards maintenance charges, e-stamp, holding charges, etc. which was not agreed to by the opposite party to be set off against compensation for delay in possession.

9.     The preliminary objection of the opposite party that the complainant is not a ‘consumer’ but an investor needs consideration in light of the Hon’ble Supreme Court’s judgment in Laxmi Engineering Works Vs. PS G Industrial Institute Civil Appeal No of 4193 of 1995 (1995) 3 SCC 583 which defines ‘commercial purpose’ and this Commission’s orders in  in Kavita Ahuja vs Shipra Estates – I (2016) CPJ 31, wherein it was held that the onus of establishing that the complainant was dealing in real estate, i.e., in the purchase and sale of plots/ flats for commercial purposes to earn profits lies upon the opposite party. This Commission in Rajnish Bhardwaj and Ors vs M/s CHD Developers Ltd., and Ors in CC no. 3775 of 2017 decided on 26.11.2019, had also observed that:

“13.      The first contention of the Learned Counsel for the Opposite Party that the Complainants are not “Consumers” and only “investors” is not supported by any documentary evidence. In a catena of judgments, this Commission has laid down that the onus of proof shifts to the Opposite Party to prove that the Complainant is “investor” and it is observed that the Opposite Party did not discharge their onus of proof regarding this aspect. Hence, we are of the considered view that the Complainants are “Consumers” as defined under Section 2 (1) (d) of the Consumer Protection Act, 1986”.

The opposite party has not established this through evidence in the present case. Only a bald assertion is made. The contention of the opposite party therefore does not sustain.

10.    The contention that this Commission lacks jurisdiction since the issue needs consideration by a civil court has also been considered. This issue was put to rest by the Hon’ble Supreme Court in M/s Emaar MGF Land Limited Vs. Aftab Singh I (2019) CPJ 5 (SC) wherein it was held that an arbitration clause in the Agreement does not bar the jurisdiction of the consumer fora to entertain a consumer complaint. This contention is therefore not justified and is not accepted.

11.   Regarding the contention of the opposite party that the complaint is barred by limitation, it is apparent that the complaint was filed on 17.02.2017. As submitted by the complainant possession was offered by the opposite party on 05.03.2018 and the registration of the sale deed was done in January/February 2022. The only surviving element in the complaint left is that of compensation for the delay. As held in Meerut Development Authority Vs. M.K Gupta (supra) by this Commission, delay in offer of possession is a continuous cause of action. In the instant case, the cause of action commenced from 25.12.2012, the date of commitment for offer of possession by the opposite party. The complainant had claimed compensation for the delay by way of interest and other costs. Though possession has been handed over, the issue of compensation still remains. Therefore, the cause of action subsists. Hence, the contention is not justifiable.    

12.   It is contended by the opposite party that as the agreement was voluntary and is not one-sided, it does not constitute any unfair trade practice. This contention needs consideration in light of the judgement of the Hon’ble Supreme Court in Pioneer Urban Land & Infrastructure Ltd Vs. Govindan Raghavan  in CA 12338 of 2018 dated 02.04.2019 wherein it has been categorically held that “… terms of a contract will not be final and binding if it is shown that the flat purchasers had no option but to sign on the dotted line, on a contract framed by the builder” (para 6.7) and that “The Appellant-Builder cannot seek to bind the Respondent with such one-sided contractual terms” (para 7). In the instant case, the Agreement was presented by the opposite party to the complainant after collecting 95% of the sale consideration which clearly left him with no option but to sign the document. The terms of the Agreement do not leave any doubt that the document is one-sided and in favour of the opposite party.

13.   Admittedly, there has been a delay in the execution of the project In a catena of judgements, the Hon’ble Supreme Court and this Commission have upheld the right of a complainant to be compensated for inordinate delay in the offer of possession of a residential apartment booked by them due to inordinate delays by builders when the complainants are bona fide consumers who have duly paid the instalments and waited for the promise of allotment to fructify. Undeniably, the opposite party had indicated a period of 18 months with a 4 month period of grace from the date of the Agreement (25.02.2011), i.e. by 25.12.2012. Possession was, however, not offered till the filing of the complaint. Although possession was offered subsequently and accepted, the intervening period of nearly 6 years is not a short period and the complainant is justified in seeking compensation for the same.

14.    In real estate projects where the opposite party/builder collects deposits against a time committed project, the management of risks is his liability. He cannot also resile from this commitment at this stage. The argument of the opposite party therefore does not merit consideration.

15.   The contentions of the complainant seeking refund with compensation in the form of interest and cost of litigation are therefore valid and liable to succeed. The opposite party has held the deposited money for over 5 years with the promise of offering a residential flat without any progress even after over 5 years citing its differences with a business partner as the ground for the cause of delay and seeking indemnity from negligence or deficiency in service on his part. Considering that the project was promoted by the opposite party with the clear commitment of a date for offering possession, it is patently erroneous for it to now claim immunity from any liability of deficiency. The complainant’s prayer for compensation for delay is completely valid since the same is admitted and established.

16.   To sum up, the possession was to be offered as on 25.12.2012 after allowing for a grace period. It was finally offered on 05.03.2018. The opposite party has admitted delay and remitted income tax deducted on the compensation for the delay although the complainant contests the period for which this is calculated. Possession has been taken by the complainant in January/February 2022 and the sale deed executed. In view of the inordinate delay in offering possession, compensation has to be paid by the opposite party from 25.12.2012 till 05.03.2018 in the form of interest on the amount deposited by the complainant as on 25.12.2012. The amount on which income tax was remitted by the opposite party will form part of this compensation as it has not yet been remitted to the complainant.   

17.    I therefore, find merit in the complaint and allow the same with the following directions:

(i)     opposite party shall pay compensation for the delay in handing over possession to the complainant from 25.12.2012, the date committed in the Agreement for the same till 05.03.2018, the date of actual offer of possession, at the rate of 9% simple interest per annum;

(ii)    this amount shall be paid within eight weeks of this order, failing which the rate of interest shall be 12% p.a.

(iii)    opposite party shall pay litigation costs of Rs 50,000/- to the complainant

18.    With these directions, the above consumer complaint stands disposed of.