Chandigarh

StateCommission

CC/37/2017

Jarnail Singh - Complainant(s)

Versus

Emerging Valley Private Ltd. - Opp.Party(s)

Surinder Sharma, Adv.

23 May 2017

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Complaint case No.	:	37 of 2017
Date of Institution	:	12.01.2017
Date of Decision	:	23.05.2017

 

Jarnail Singh son of Darshan Singh, resident of 143, Bhai Gurditta Nagar, Ghas Mandi, Basti Sheikh, Jalandhar

……Complainant

V e r s u s

Emerging Valley Private Limited, Corporate Office Shop-cum Officer 46-47, First Floor, Sector 9-D, Madhya Marg, Chandigarh-160009, through its Director/Managing Director.

              .... Opposite Party

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

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

                MR. DEV RAJ, MEMBER.

                MRS. PADMA PANDEY, MEMBER

 

Argued by:Sh.Surinder Sharma, Advocate for the complainant.

                 Sh.Arun William, Advocate for the opposite party.

 

PER JUSTICE JASBIR SINGH (RETD.), PRESIDENT

                 The complainant booked a residential flat (3BHK-SQ), in a project launched by the opposite party, under the name and style ‘Emerging Height 4’, situated within Emerging Valley project, at Landran-Banur Road, Mohali, Punjab. Booking amount to the tune of Rs.9,20,000/- paid to the opposite party was confirmed on 09.04.2012. Total price of the unit was fixed at Rs.37.80 lacs plus club charges of Rs.50,000/- and Rs.25,000/- towards interest free maintenance charges. Qua delivery of possession of the built-up unit, it was agreed vide allotment letter dated 19.08.2013 Annexure C-2, as under:-

“In case the company fail to give possession of the property to you by the maximum time-limit of three and half years after allotment, then the company shall be liable to pay you interest at the rate 12% p.a. on the installments paid by you till the date of delivery of actual possession, statutory/legal impediments and majeure reasons expecting”.”

It was stipulated that an attempt will be made to give possession of the unit, within maximum time limit of 3 ½ years from the date of allotment, failing which, for the delayed period, till the delivery of actual possession, the opposite party shall be put under an obligation to pay interest @12% p.a. simple, on the installments paid. By 27.10.2014, the complainant had paid the following amount:-

 

S.no.	Amount	Receipt No.	Dated	Remarks
	25000.00		09.03.2012	Application fee
	920000.00	102	09.04.2012	First installment
	567000.00	169	06.11.2012	Second installment
	567000.00	558	22.04.2013	Third installment
	567000.00	1017	23.09.2013	Fourth installment
	567000.00	510	12.03.2014	Fifth installment
	378000.00	1789	27.10.2014	Structure completion installment
Total	35,91,000.00

 

In all, the complainant had deposited an amount of Rs.35.91 lacs i.e. 95% of the total sale consideration. Copy of receipts has been placed on record as Annexure C-3 colly. The complainant continued to wait for delivery of possession of the unit. However, possession of the unit was not offered. In the year 2016, he personally visited the site and was surprised to see that construction qua the project, in question, had not yet started. It was stated that the said act of getting money and not starting construction of the unit, would amount to adoption of unfair trade practice. On 06.08.2014, he sent a letter to the opposite party mentioning above fact and made a request that possession of the unit be delivered forthwith, however, it was not so done. He served legal notice dated 05.01.2016 Annexure C-4, seeking grant of possession of the unit and also compensation by way of interest for the period of delay, as promised, but to no avail.

                It is specific case of the complainant that when the project was launched/sold, in the year 2012, even certificate of Change of Land Use, was not available with the opposite party.

                By stating as above, complaint, under Section 17 of the Consumer Protection Act, 1986 (in short the Act), was filed by the complainant with a prayer that directions be issued to the opposite party to refund the amount paid with interest @12% p.a.; compensation to the tune of Rs.1.50 lacs, for mental agony and physical harassment, besides payment of litigation expenses, to the tune of Rs.25,000/-.

2.         Upon notice, written reply was filed by the opposite party on 01.03.2017 alongwith which documents Annexures R-1 to R-3 were placed on record. It was averred that the complainant has filed this complaint, by concealing material facts. Possession of the unit had been offered to the complainant on 17.10.2016 Annexure R-2, alongwith which, demand of amount due was also made, however, he failed to make payment of the same, which resulted into non delivery of possession to him. It was further stated that possession of the unit already stood delivered to many other allottees, in the same locality. It was also stated that letter of allotment dated 19.08.2013 was provisional, whereas, final allotment letter was issued on 10.03.2014. In the previous allotment letter, it was specifically stated that the allotment made, does not constitute any definitive or final allotment, until Buyer’s Agreement is not signed between the parties. It was averred that final allotment of the unit was made on 10.03.2014, as such, possession of the unit can be delivered upto 09.09.2017 (end period). The complaint having been filed before the end period, is liable to be dismissed. It was further stated that the project of the opposite party was approved by the Competent Authorities. Attempt will be made to complete the project, in a time bound manner.
3.         On merits, in para no.1, it was specifically admitted that in the project namely ‘Emerging Height 4’, situated within Emerging Valley project, at Landran Banur Road, Mohali, Punjab, construction could not be started and on account of that, in consultation with the complainant, alternative residential flat was offered in the project named ‘Prabh Homes’, located in Emerging Valley, Landran Banur Road, Mohali. The complainant has failed to disclose the above said fact, as such, the complaint needs to be dismissed on this ground alone. The booking of unit; payments made in respect of the same, as mentioned in the complaint; issuance of allotment letter dated 19.08.2013; were not controverted. It was admitted that the complainant had visited the site number of times, as alleged. It was denied that any request was made, in writing, to complete construction, as stated. It was stressed that in terms of final allotment letter dated 10.03.2014, possession of the unit was offered on 17.10.2016, before the end date. It was further stated that the complainant is seeking refund, as he failed to earn profits out of the unit, because of slow down in the real estate market. In other words, an attempt was made to say that he is an investor. It was prayed that let the complaint be dismissed.
4.         Thereafter, during pendency of this complaint, the opposite party moved an application, to place on record some more documents Annexure R-4 to R-11, which was allowed on 06.04.2017, subject to payment of costs. Those documents are taken on record. Perusal of those documents indicate that when the project, in dispute, was launched, not even a single approval granted by the Competent Authorities, was available with the opposite party. Subject to many conditions, CLU was granted on 04.07.2013 and thereafter, in continuation to the said letter, another letter was issued on 23.09.2013 Annexure R-5. As per conditions imposed, before starting the development in the project, it was necessary for the opposite party to get licence, as per terms and conditions of The Punjab Apartment and Property Regulation Act, 1995 (PAPRA). NOC from Punjab Pollution Control Board (PPCB) was to be obtained before start of development. Other permissions like environmental in terms of Notification dated 14.09.2006; NOC from the Forest Department etc., were also to be got issued. Document Annexure R-6 indicates that to make arrangements for treatment and disposal of sewerage, communication was sent by the GMADA, only on 20.11.2015. As per information supplied through document Annexure R-7, it was indicated that some land falling in the project was mutated, in the name of the opposite party, in the year 2015. Perusal of photographs placed on record Annexure R-11, also makes it very clear that within the project only, wherein an alternative unit was offered, the development/construction appears to be incomplete. The facts brought on record by the opposite party itself, make out a case in favour of the complainant. It is admitted in the written statement itself and also at the time of arguments by Counsel for the opposite party that in the project, when the unit was initially sold to the complainant in the year 2012, construction had not started at all.

                Without discussing anything further, on the basis of this admission itself, it can safely be said that the opposite party was guilty of providing deficient service to the complainant and refund of the amount deposited, can be ordered accordingly.

                Be that as it may, it is on record that there is nothing to show that any permission was available with the opposite party when project was sold in the year 2012. To launch the project, without getting necessary permissions/approvals, would amount to unfair trade practice. Similar view was expressed by the National Commission in a case titled as Emerging India Real Assets Pvt. Ltd. and another vs. Kamer Chand and another, Revision-Petition No.765 of 2016, decided on 30.03.2016. In that case, it was held as under:-

“We are unable to persuade ourselves to agree with the ld. counsel.  While affirming the order passed by the District Forum and commenting and deprecating the conduct of the Opposite Parties in the complaint, in launching the project and selling the farmhouses, even without obtaining sanction/approval from the competent authority, the State Commission has observed as follows:-

If a marketing agency sells out a project, for which, no approvals/sanctions have been granted by the Govt. Authorities, the said agency has to face the music and consequences of duping the gullible buyers, of their hard-earned money. In the public notice, it has specifically been mentioned by the GMADA that respondent no.2 and appellant no.1 are the sister concern. It is also apparent on record that before appellant no.1 started marketing the project, not even an application has been filed by respondent no.2, to get approval/sanction from the competent authorities, to launch the project. The information supplied vide letter dated 26.08.2014, referred to above, clearly states that not even a single application qua granting sanction to the project, has been received and dealt with, by the Competent Authority. In connivance with each other, the appellants and respondent no.2 committed a criminal offence of cheating. As per established law, builder cannot sell its property, unless and until proper approvals/sanctions have been obtained by it, from the Competent Authorities. It appears from the reading of documents on record that instead of selling a unit in a project, respondent no.2 in a very arbitrary manner, sold its share in a joint land measuring approx. 3807 acres, bearing hadbast No.326, Khewat No.92, Khatauni no.254-352, at Village Mirzapur, District Mohali, Punjab. There is nothing on record that said land was ever partitioned.

                6.    We are in complete agreement with the view                        taken by the State Commission. ”

                 The principle of law, laid down in the aforesaid case, is fully applicable to the present case. In view of above, it can safely be said that by adopting unfair trade practice, the project was sold/launched.

5.         Contention of Counsel for the opposite party that initially the unit was provisionally allotted and final allotment was issued only on 10.03.2014, appears to be incorrect. It is a blank document, not signed by the complainant or representative of the opposite party. It appears that the said document was created only to defeat the genuine claim of the complainant.

                At the time of arguments, it was said by Counsel for the opposite party that the original document is available, however it could not be traced out from warehouse of the opposite party. Such a plea cannot be accepted. Offer of possession made vide letter dated 17.10.2016 also appears to be fake. There is not an iota of evidence on record to prove that offer of alternative unit was ever accepted by the complainant. It appears that the said letter was created and issued to the complainant, when he sent legal notice seeking refund of amount paid. As has been discussed in earlier part of this order, there was no compliance to the provisions of PAPRA. The opposite party was not even owner of the land, qua which it made an application for grant of certificate of CLU. Mutation in respect of the land, in dispute, was sanctioned much later. None of the copies of orders granting approvals, in respect of launch of the said project, have been placed on record. In this view of the matter, it is held that the opposite party was deficient in providing service and also, is guilty of adoption of unfair trade practice. As such, the complainant is held entitled for the amount paid with interest. At the same time, the opposite party is also held liable to compensate the complainant for inflicting mental agony and physical harassment to him.  

6.         The next question that falls for consideration is as to whether, the complainant is an investor and did not fall within the definition of a consumer, under Section 2 (1) (d) (ii) of the Act, as alleged by the opposite party. It may be stated here that there is nothing on record, that the complainant is a property dealer, and deals in the sale and purchase of property, on regular basis, and as such, the unit, in question, was purchased by him, by way of investment, with a view to resell the same, as and when, there was escalation in the prices thereof. Since, the opposite party has leveled allegations against the complainant, as such, the onus lays upon it, to prove it, which it failed to do so. Thus, in the absence of any cogent evidence, in support of the objections raised by the  opposite party, mere bald assertion i.e. simply saying that the complainant being investor, 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. Not only this, recently in a case titled as  Aashish Oberai Vs. Emaar MGF Land Limited, Consumer Case No. 70 of 2015, decided on 14 Sep 2016, under similar circumstances, the National Commission negated the plea taken by the builder, while holding as under:-

“In the case of the purchase of the houses which a builder undertakes to construct for the buyer, the purchase can be said to be for a commercial purpose where it is shown, by producing evidence, that the buyer is engaged in the business of a buying and selling of houses and or plots as a trading activity, with a view to make profits by sale of such houses or plots.  A person cannot be said to have purchased a house for a commercial purpose only by proving that he owns or had purchased more than one houses or plots.  In a given case, separate houses may be purchased by a person for the individual use of his family members.  A person owning a house in a city A may also purchase a house in city B for the purpose of staying in that house during short visits to that city.  A person may buy two or three houses if the requirement of his family cannot be met in one house. 

 

 

                The principle of law, laid down, in the aforesaid cases, is fully applicable to the present case. The  complainant, thus, falls within the definition of a ‘consumer’, as defined under Section 2(1)(d) of the Act. Such an objection, taken by the opposite party, in its written reply, therefore, being devoid of merit, is rejected. 

7.          No other point, was urged, by Counsel for the parties.
8.         For the reasons recorded above, the complaint is accepted, with costs. The opposite party is directed as under:-

1. To refund the amount Rs.35.91 lacs, to the complainant, alongwith interest @12% p.a.,  from the respective  dates  of  deposits onwards.
2. To pay compensation, in the sum of Rs.1.50 lacs, for causing mental agony and physical harassment, to the complainant, as also escalation in prices.
3. To pay cost of litigation, to the tune of Rs.25,000/- to the  complainant.
4. The payment of awarded amounts mentioned at sr.nos.(i) to (iii), shall be made, within a period of 45 days from the date of receipt of a certified copy of this order, failing which, the amount mentioned at sr.no.(i) shall carry penal interest @15% p.a., instead of @12%, from the respective dates of deposits onwards, and interest @15 % p.a., on the amounts mentioned at sr.nos.(ii) and (iii), from the date of filing of this complaint, till realization.

9.         However, it is made clear that, if the complainant has availed loan facility from any banking or financial institution, for making payment of installments towards the said unit, it shall have the first charge of the amount payable, to the extent, the same is due to be paid by him (complainant).
10.         Certified copies of this order be sent to the parties, free of charge.
11.         The file be consigned to Record Room, after completion.

Pronounced.

23.05.2017

Sd/-

[JUSTICE JASBIR SINGH (RETD.)]

PRESIDENT

 

Sd/-

 (DEV RAJ)

MEMBER

 

Sd/-

 (PADMA PANDEY)

        MEMBER

 

 

Rg.