Chandigarh

StateCommission

CC/44/2016

Shri Ashwani Kumar - Complainant(s)

Versus

Emaar MGF Land Ltd - Opp.Party(s)

NP Sharma

30 Sep 2016

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

Complaint case No.	:	44 of 2016
Date of Institution	:	05.02.2016
Date of Decision	:	30.09.2016

 

1. Shri Ashwani Kumar, aged about 58 years S/o Shri Sukhdev Raj r/o 22, Lajpat Nagar, Jalandhar, Punjab.
2. Shri Anil Kumar, aged about 46 years S/o Shri Sukhdev Raj r/o 22, Lajpat Nagar, Jalandhar, Punjab.
3. Shri Ashish Kumar, aged about 34 years S/o Shri Ashwani Kumar r/o 22, Lajpat Nagar, Jalandhar, Punjab.

 

……Complainants

V e r s u s

1. Emaar MGF Land Limited, through its Managing Director, ECE House, 28, Kasturba Gandhi Marg, New Delhi – 110 001.
2. Emaar MGF Land Limited, through its Project Head/Branch Manager, SCO Nos. 120-122, 1^st Floor, Sector 17-C, Chandigarh, UT – 160017.  

                                                    .... Opposite Parties

BEFORE:         JUSTICE JASBIR SINGH (RETD.), PRESIDENT

                        MR. DEV RAJ, MEMBER.

                        MRS. PADMA PANDEY, MEMBER

 

Argued by:      

 

Sh.  Neeraj Pal Sharma, Advocate for the complainants.

Sh.  Sanjeev Sharma, Advocate for the Opposite Parties.

 

PER PADMA PANDEY, MEMBER

 

               The facts, in brief, are that the Opposite Parties floated a land development project titled as “Mohali Hills” in the year 2005 accompanying with high quality support and lifestyle enhancement facilities at Mohali, Punjab. The complainants in order to provide a better lifestyle and facilties to their respective families and also with the intent to shift to the vicinity of Chandigarh, applied independently for three separate floors being purely residential accommodation with the Opposite Parties. It was stated that the Opposite Parties offered various types of accommodations to the public at large in the said project, amongst other including “The Terraces” situated at Pinewood Park, Sector 108, Mohali Hills during the booking period and in pursuance thereof, the complainants jointly expressed interest in the said scheme and registered with Opposite Party No.2 for three independent floors, which were subsequently allotted as unit No. 729 on Ground Floor for complainant No.1, first floor for complainant No.2 and second floor for complainant No.3 with the basic sale prices of Rs.46,00,000/-  for Ground Floor, Rs.38,00,000/- for first floor and Rs.36,00,000/- for second floor. It was stated that the Opposite Parties committed a factual mistake when issuing the allotment letters and the same was brought to their notice and, as such, fresh letter of allotments dated 13.04.2009 for respective three floors were issued in favour of the complainants.  It was further stated that the Opposite Parties unilaterally and without any consent, altered the  Time Bound Payment Schedule to Construction Linked Payment Schedule in July, 2009.           It was further stated that Opposite Party No.2 in the same very month of July, 2009 entered into three separate Independent Floor Buyers Agreements with the complainants i.e. with complainant No.1 vide Agreement dated 24.07.2009 and complainant No.2 and complainant No.3  vide Agreements dated 28.07.2009. It was further stated that the Opposite Parties were bound to deliver possession of the unit within a period of 36 months i.e. latest by 28.07.2012. It was further stated that complainant No.1 paid the total amount of Rs.18,60,155/-, complainant No.2 paid the total amount of Rs.15,48,155/- and complainant No.3 paid the total amount of Rs.14,70,155/- in respect of the unit, in question. As such, the complainants collectively paid the total amount of Rs.48,78,465/- in respect of the unit, in question. Copies of the receipts and Agreements are Annexures C-1 (colly.) to C-3 (colly.).  It was further stated that when no news regarding delivery of possession was shared by the Opposite Parties after the passage of maximum period of 36 months, which ended on 28.07.2012, complainant No.1 sent an email to the Opposite Parties on 27.08.2012 seeking details of the expected date of delivery of possession of the unit, in question, which was duly replied by them vide email dated 28.08.2012 (Annexure C-4) informed the complainants that “the construction on the same is yet to commence”, however, the Opposite Parties were tightlipped about making any commitments. On the last week of October, 2012, when complainant No.3 visited the site, he found that the entire exercise being indulged by the Opposite Parties was to cream off the payments from the allottees and later on abandoned the said project. Thereafter, the complainants continuously with their concerted efforts were seeking the status of the completion of the development work from the official of Opposite Party No.2, who said that the same would be completed soon, however, in the same breath, he also offered alternative unit to the complainants, which were out rightly refused by them. It was further stated that when the complainants failed to receive any further updates regarding the status of the project, they sent separate letters dated 11.11.2014 (Annexure C-5 colly.). The Opposite Parties vide their final communication dated 12.01.2015 informed the complainants that the construction of the residential unit had not even been started by them. Copies of the letters are Annexure C-6 (colly.). 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 complainants, 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 written version, have taken objection regarding arbitration clause in the Agreement, for referring the matter to the Arbitrator in terms of the agreed terms and conditions of the Agreement.  It was stated that this Commission has got no territorial jurisdiction to entertain and decide the complaint because as per Clause 39 of the Agreement and Clause 42.6 and further on page No.68 of the Agreement, it is mentioned that Agreement was signed and executed at Mohali. It was further stated that the complaint is not maintainable on account of lack of pecuniary jurisdiction because the complainants have clubbed three cause of actions in a single complaint and, as such, the complainants had paid less than Rs.20 lacs to the Opposite Parties.   It was further stated that the complaint is barred by limitation, as the cause of action accrued to the complainants on 05.11.2012 when admittedly they had became aware of the fact that construction at their unit have not started and they also refused alternate location, as such, the present complaint now being filed in the year 2016 is clearly time barred. It was further stated that the complainants are not consumers, as the reasoning given by them for shifting to Chandigarh is beyond any reasoning and comprehension. It was further stated that the complainants have applied for one single unit No.729 in Terraces and asked for three separate Agreements for each floor of the terraces. It was further stated that the complainants have filed three different applications and have executed three separate Agreements and one single complaint has been filed by the complainants, as the unit is same and the complainants are trying to project these as three separate units. It was further stated that the Company issued provisional allotment letters in the name of the complainants on 13.04.2009 and executed the Agreements on 24.07.2009 for TTM-GF-729 and on 28.07.2009 for TTM-FF-729 and TTM-SF-729. It was further stated that the complainants are family members and single unit No.729 in The Terraces have been purchased by them and the price of the said unit is more than Rs.1 crore. It was further stated that initially it was a time linked payment schedule, which was later on changed to time cum construction linked payment schedule, as per the demands with the actual development on site but they (complainants) never objected to the same. It was further stated that the Company has proposed to handover possession of the unit within 36 months and for any delay beyond 36 months, Company was bound to pay delayed compensation, for the delay beyond the agreed time. It was further stated that the Company received an amount of Rs.18,60,155/- against Ground Floor, Rs.15,48,155/- towards First Floor and Rs.14,70,155/- towards second floor Annexure R-1 (Colly.).  It was further stated that possession of the unit is delayed since the construction has not been initiated on the same. However, the Company offered an alternate unit to the complainants in any of the project, if they so desire, where possession could be facilitated shortly but they refused to accept the same. 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 Parties led evidence, in support of their case.

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

5.           Admittedly, provisional allotment of unit bearing Nos.729/GF in the name of Sh.Ashwani Kumar (complainant No.1),  unit No.729/FF in the name of Sh.Anil Kumar (complainant No.2) and unit No.729/SF in the residential project “The Terraces” situated at Mohali Hills in Sector 108, SAS Nagar, District Mohali, Punjab was allotted to the complainants vide provisional allotment letters (Annexure C-1/2, C-2/2 and C-3/2). It is also the admitted fact that separate Independent Floor Buyer’s Agreements were executed between the parties, as is evident from page Nos. 53, 82 and 111 of the file. It is also the admitted fact that the complainants paid the total amount of Rs.48,78,465/- i.e. Rs.18,60,155/- paid by complainant No.1 for the Ground Floor, Rs.15,48,155/- paid by complainant No.2 for the First Floor and Rs.14,70,155/- paid by complainant No.3 for the Second Floor, in respect of the unit, in question, as is evident from the statement of accounts (Annexure R-1 colly.). It is also the admitted fact that despite receipt of the huge amount, the Opposite Parties failed to hand over possession of the unit, in question, to the complainants, despite repeated requests.

6.             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 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 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.

7.           Another frivolous objection was taken by the Opposite Parties, by stating that this Commission has no territorial jurisdiction to entertain and decide the complaint or not.

              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, the perusal of record reveals that provisional allotment letters (Annexures C-1/2, C-2/2 & C-3/2), receipts (at page Nos. 42 to 44, 71 to 73 and 100 to 102), letters dated 12.01.2015 (Annexure C-6 colly.), were sent by Chandigarh office of the Opposite Parties, as the same had the address “Emaar MGF Land Limited, SCO 120-122, 1^st Floor, Sector 17-C, Chandigarh-160017”. It means that a part of cause of action arose to the complainants, within the territorial Jurisdiction of this Commission. This Commission has, therefore, got territorial Jurisdiction to entertain and decide the complaint. The objection taken by the Opposite Parties, also stands rejected.

8.           Another objection taken by the Opposite Parties, with regard to pecuniary jurisdiction, also deserves rejection. In the present case, the complainants booked only one unit i.e. unit No.729 and amount was paid by complainant No.1 to the tune of Rs.18,60,155/- for the Ground Floor, Rs.15,48,155/- paid by complainant No.2 for the First Floor and Rs.14,70,155/- paid by complainant No.3 for the Second Floor. Thus, the complainants paid the total amount of Rs.48,78,465/- (Rs.18,60,155/- + Rs.15,48,155/- + Rs.14,70,155/-). Even the complainants filed only one complaint for the said unit because the unit number is the same but only floors are different.  It may be stated here, that the complainants have sought refund of an amount of Rs.48,78,465/- paid by them, towards price of the unit, alongwith interest @24% p.a. on the entire amount from the respective dates of deposits, till realization;  compensation to the tune of Rs.9 lacs (Rs.3 lacs for each complainants), for mental agony & physical harassment; and cost of litigation, to the tune of Rs.66,000/-, aggregate value whereof [excluding the interest claimed] fell above Rs.20 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 complainants, 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.           The objection taken by Counsel for the Opposite Parties, to the effect that the complainants did not fall within the definition of a consumer, as defined by Section 2 (1) (d) (ii) of the Act, because the reasoning given by them (complainants) for shifting to Chandigarh is beyond any reasoning and comprehension, also deserves rejection. Even the complainants in their complaint have specifically stated that they (complainants), all residents of Jalandhar, Punjab in order to provide a better life style and facilities to their respective families and with the intent to shift to the vicinity of Chandigarh for a more wholesome life style, applied independently for three separate floors being purely residential accommodation with the Opposite Parties. 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 floor/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  Counsel for the Opposite Parties, mere bald assertion i.e. simply by saying that the  reasoning for shifting to Chandigarh given by the complainants is beyond any reasoning, 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  Counsel for the Opposite Parties, therefore, being devoid of merit, is rejected.  

10.          The next question, that falls for consideration, is, as to whether, the complaint filed by the complainants, was within limitation or not.  It may be stated here that since it has been frankly admitted by the Opposite Parties, in para No.15 of their joint written statement that “the possession of the unit is delayed since the construction has not been initiated on the same.” It is pertinent to note that after the receipt of the huge amount of Rs.48,78,465/- from the complainants, the Opposite Parties failed to offer/deliver possession of the unit to the complainants, despite repeated requests. Therefore, complainant No.1 and on behalf of other complainants, sent an email to the Opposite Parties on 27.08.2012 seeking details of the expected date of delivery of possession of the unit, the Opposite Parties vide their email dated 28.08.2012 (Annexure C-4) informed them that “the construction of the same is yet to commence”. Not only this, the Opposite Parties vide their final communication dated 12.01.2015 (Annexure C-6 colly.) to the complainants informed that “construction on your unit mentioned above is yet to commence.” Even the Opposite Parties neither delivered possession of the unit to the complainants nor refunded the amount to them, despite repeated requests, as such, there is continuing cause of action, in their favour, in view of principle of law laid down, in  Lata Construction & Ors. Vs. Dr. Rameshchandra Ramniklal  Shah and Anr., II 2000 (1) CPC 269=AIR 1999 SC 380 and Meerut Development Authority Vs. Mukesh Kumar Gupta, IV (2012) CPJ 12 (SC). Under these circumstances, it is held that the complaint is not at all barred by time. The submission of Counsel for  the Opposite Parties, in this regard, being devoid of merit, must fail, and the same stands 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 complainants. In this regard Clause 20.1 of the  Independent Floor Buyer’s Agreement reads thus :-

“20.1 Subject to Force Majeure conditions and reasons beyond the control of the Company and subject to the Allottee not being in default of any of the provisions of this Agreement and having complied with all provisions, formalities, documentation etc. and the terms and conditions of this Agreement, the Company proposes to hand over the possession of the independent floors within a period of 36 months from the date of signing of this Agreement. The Allottee agrees and understands that the Company shall be entitled to a grace period of ninety (90) days, after the expiry of 36 months for applying and obtaining the occupation certificate in respect of the Terraces.”

In view of the afore-extracted clause, it is clear that possession of the unit was to be delivered to the complainants within a period of 36 months from the date of signing of the Agreement. The grace period of 90 days mentioned in the aforesaid clause is after the expiry of thirty-six (36) months for applying and obtaining the occupation certificate. As such, possession was to be delivered within a maximum period of 36 months from the date of signing of the Agreement. In the instant case, the Agreements were executed between the parties in July, 2009 and, as such, possession was to be delivered latest by July, 2012 and not more than that.  However, the Opposite Parties failed to offer/deliver possession to the complainants, within the stipulated period, as mentioned in the Agreement. Moreover, the Opposite Parties already received a huge amount of Rs.48,78,465/-, towards the said unit. By making a misleading statement, that possession of the unit, was to be delivered within a period of 36 months, from the date of signing 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 complainants are entitled to refund of the amount of Rs.48,78,465/-, deposited by them. It is an admitted fact that the Opposite Parties are unable to deliver  possession of the unit, in question, as admitted by them, and firm date of delivery of possession of the unit, could not be given to them (complainants). It is well settled law that the purchaser/allottee(s) cannot be forced for relocation to any other unit, unless and until they wish to do so. The complainants cannot be made to wait for an indefinite period, for delivery of actual physical possession of the unit purchased by them. The  Opposite Parties, therefore, had no right, to retain the hard-earned money of the complainants, deposited towards price of the unit, in question. The complainants are thus, entitled to get refund of amount deposited by them. 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.

13.          It is to be further seen, as to whether, interest, on the amount refunded, can be granted, in favour of the  complainants. It is not in dispute that an amount of Rs.48,78,465/-, was paid by the complainants, without getting anything, in lieu thereof. The said amount has been used by the Opposite Parties, for their own benefit. There is no dispute that for making delayed payments, the  Opposite Parties were charging heavy rate of interest (compounded quarterly @24% p.a.) as per Clause 19.1 of the Agreements, for the period of delay in making payment of installments.  It is well settled law that whenever money has been received by a party and when its refund is ordered, the right to get interest follows, as a matter of course. The obligation to refund money received and retained without right implies and carries with it, the said right. It was also so said by the Hon’ble Supreme Court of India, in UOI vs. Tata Chemicals Ltd (Supreme Court), (2014) 6 SCC 335 decided on March 20th, 2014 (2014) 6 SCC 335). In view of above, the complainants are certainly entitled to get refund of the amount deposited by them, to the tune of Rs.48,78,465/- alongwith interest @15% compounded quarterly, from the respective dates of deposits till realization.

14.           As far as the plea taken by the Opposite Parties, regarding forfeiture of earnest money 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 unit, to be delivered to the complainants, by the stipulated date but it was they (complainants) who wanted to rescind the contract, on account of some unavoidable circumstances/ financial constraints or for any personal reason, and are seeking refund of the amount deposited. Had this been the case of the Opposite Parties, only in those circumstances, it would have been held that since the complainants themselves are rescinding the contract, as such, they are entitled to the amount deposited, after deduction of the earnest money, as per the terms and conditions of the Agreement. In this view of the matter, the plea taken by the Opposite Parties, has no legs to stand and is accordingly rejected.

15.          No other point, was urged, by the Counsel for the parties.

16.          For the reasons recorded above, the complaint is partly accepted, with costs. The Opposite Parties are jointly and severally directed, as under:-

1. To  refund   the  amount Rs.48,78,465/-, to  the complainants, in the proportion of their deposits with the Opposite Parties (3 in numbers) alongwith interest compounded quarterly @ 15%, from the respective  dates of deposits onwards, within 45 days, from   the  date of receipt of a certified copy of  this   order.
2. To pay compensation, in the sum of Rs.50,000/- each i.e. Rs.1,50,000/- to the complainants for causing mental agony and harassment, within 45 days, from the date of receipt of a certified copy of this order.
3. To pay cost of litigation, to the tune of Rs.30,000/- to the complainants (3 in numbers).
4. In case, the payment of amounts, mentioned in Clauses (i) and (ii), is not made, within the stipulated period, then the Opposite Parties shall be liable to pay the amount mentioned in Clause (i) with interest compounded     quarterly @18%, instead of interest compounded quarterly @ 15%, from the respective dates of deposits, till realization, and interest compounded quarterly @15%, on the  amount of compensation, mentioned in Clause (ii), from the date of filing the complaint, till realization, besides payment of litigation costs.

 

17.          Certified Copies of this order be sent to the parties, free of charge.

18.          The file be consigned to Record Room, after completion.

Pronounced.

September 30, 2016.

[JUSTICE JASBIR SINGH (RETD.)]

[PRESIDENT]

 

 

 [DEV RAJ]

MEMBER

 

 

 (PADMA PANDEY)

        MEMBER

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