Mrs. M. Shreesha, Member

          Aggrieved by the order dated 28.12.2016 in Consumer Complaint No. 429 of 2016, passed by the State Consumer Disputes Redressal Commission, UT Chandigarh (in short “ the State Commission”), Emaar MGF Land Ltd. preferred this First Appeal under Section 19 of the Consumer Protection Act, 1986 (in short “the Act”). By the impugned order, the State Consumer has directed the Opposite Party (hereinafter referred to as “the Developer”) to refund the amount of ₹47,64,862/- to the Complainants with interest @ 15% p.a. compounded quarterly from the respective date of deposits; to pay compensation of ₹2,00,000/- for the mental agony caused and to pay ₹50,000/- towards cost of litigation. The State Commission has directed the awarded amount to be paid within a period of two weeks from the date of receipt of a certified copy of the order, failing which, the amount shall attract penal interest @ 18% p.a. compounded quarterly from the respective dates of deposits and interest @ 15% to be compounded quarterly on the amount of compensation and costs from the date of filing of the Complaint till the date of realisation.

2.       Briefly put, the facts material to the case are that the Complainants, attracted by the advertisement issued by the Developer, paid an amount of ₹5,00,000/- and registered with the Developer for purchase of a 300 sq. yd. Plot in Augusta Park, Sector 109, Mohali. A Plot buyers Agreement was executed between the parties on 20.10.2012 for an amount of ₹49,87,050/- and the said sale consideration was required to be paid within one year. It was stated that the Complainants deposited almost the entire amount i.e. ₹47,64,862/- on 26.10.2013 and the possession was to be delivered by 22.04.2014. It was averred that the Complainants sent an email on 07.09.2014 requesting for possession of the unit and also personally visited their office, but there was no response. While so, the Developer sent a letter on 27.03.2015, informing the Complainants that they were unable to deliver the possession and asked the Complainants, if they were interested in relocation to another Plot. It was averred that the Complainant wrote another letter on  04.05.2015 requesting for early delivery of the possession, but the Developer vide reply dated 30.07.2015, flatly refused to deliver the possession and instead offered another Plot No. 369, in Sector 018, Mohali admeasuring 310.415 sq. yd. and for this relocated Plot, the Complainants never signed any amended Plot Buyer’s Agreement.

3.       Thereafter the Complainants sent a letter dated 05-07-2016 to the Developer, requesting for the refund of the amount along with interest and compensation. Subsequent to this request, the Developer issued another intimation of possession letter of the relocated Plot to the Complainants on 16.07.2016, which was not acceptable to the Complainants. Further, the Complainants vide their reply dated 27-07-2016 once again sought refund of the amount but the Developer failed to respond. It was further averred that the Developer failed to take all the requisite permissions from the authorities before developing the mega housing project; that as per notification dated 02-09-2014, issued by Government of Punjab, Department of Housing and Urban Development, all the housing projects were required to take Completion Certificate and in pursuance of the aforesaid notification, District Town Planner, GMADA, Mohali issued a letter dated 16-02-2015 to the Developer to obtain the Completion Certificate, but the Developer applied only for Partial Completion Certificate and that too of only a small part of area i.e. 310.139 acres, which was issued only on 16-10-2015 with some terms and conditions. It was also averred that the Developer was required to develop two STP and the said STP should be installed under the inspection of independent expert and report be submitted to the Ministry of Environment and Forests but the Developer failed to place on record any document to prove the same. Hence the  Complainant approached the State Commission seeking refund of the amount deposited with interest @ 15% p.a. from the respective dates of deposit till the date of realisation; compensation of ₹5,00,000/- and costs of ₹80,000/-.

4.       The Developer filed their Written Version stating that the Complainants had purchased unit No. 109-AP-387-300 in the year 2012 for commercial purpose; a provisional allotment letter dated 24.09.2012 was issued wherein the total sale consideration of the unit was agreed at ₹49,87,050/-; there was no definitive agreement that the possession would definitely to be delivered within 12 months; the word used in Clause 8 is ‘endeavour’ which means efforts would be made and therefore time was never the essence of the contract; amount of ₹47,64,865/- was received towards the aforenoted unit which was transferred to the relocated unit namely, 108-PP-269-310; an amount of ₹2,16,493/- was already paid towards compensation for the delay in delivery of possession; it was only on the Complainants request that the Developer agreed to relocate to the present unit and this option was accepted by them vide email dated 25.06.2015; it was  only after the receipt of this email that a confirmation letter was issued on 30.06.2015; that the Complainants deliberately  concealed the email dated 25.06.2015; having accepted the relocated Plot, the owners cannot now seek refund of the amount paid. Therefore there is no deficiency of service on their behalf in offering another unit to the Complainant.

5.       It was further averred that the Government of Punjab had exempted the Housing Project from the provisions of the PAPRA Act vide notification No. 18/41/2006-5HG-II/12790 dated 22.12.2006; the fact of exemption under PAPRA Act was clearly mention in Clause B of the Agreement dated 22.10.2012; partial occupation certificate was obtained  only by way of   abundant caution; the Complainants are residents of House No. 369 at Sector-7, Panchkula and are already having property and therefore they do  not fall within the ambit of definition of ‘Consumer’ in Section 2 (1) (d) of the Act and finally that as per clause 42 of the Agreement, the State Commission has no territorial jurisdiction to entertain the Complaint as  the Clause stipulates that only the courts at Mohali have territorial jurisdiction in all matters arising out of any issue concerned in this Agreement.

6.       The State Commission based on the evidence adduced allowed the Complaint with the aforenoted directions.

7.       The State Commission has given a finding that the Complainant cannot be made to wait for an indefinite  period of time, for delivery of actual physical possession of the original unit in Sector-109 Mohali. It was also observed that the Complainants cannot be made to accept relocated unit in Sector 109 and that the Developer was deficient in retaining the hard earned money of the Complainants when it was not in a position to deliver the Original Plot allotted to them.

8.       Learned counsel appearing for the Developer vehemently argued that it was only on the confirmation email dated 25.06.2015 received from the Complainants, that the Developer relocated the Plot to unit No. 108-PP-269-310. He submitted that a confirmation letter was issued by them on  30.07.2015, for which the Complainants relied on the letter dated 05.07.2016, which was never received by the Developer. He contended that the Complainants are owners of House No. 369, Sector-7, Panchkula and also have other properties in their name and therefore do not fall within the definition of ‘Consumer’ as defined under Section 2 (1) (d) of the Act. He also contended that Time was not the essence of the Contract as there was no definite promise given to the Complainants that delivery would be done within a specific period of time. It was only stated that the Developer ‘shall endeavour to deliver’ and therefore there is no delay in handing over the possession of the unit. Moreover, if the period of 12 months mentioned in clause 8 was subject to force majeure condition yet an amount of ₹2,16,493/- was  paid  to the Complainants at the rate of ₹50 per sq. yd. per month for the delayed period. He submitted that the State commission has erred in refunding the amount with interest @ 15% compounded quarterly, which is against the ratio laid down by the Hon’ble Supreme Court in GDA Vs. Balbir Singh, (2004) 5 SCC 65.

9.       First we address ourselves to the contention raised by the learned counsel appearing for the Developer that the Complainants are not ‘Consumers’ as they already own another House No. 369 at Sector-7, Panchkula. This Commission in Aashish Oberai Vs. Emaar MGF Land Limited [I (2017) CPJ 17 (NC)] has held that the onus to prove that  the Complainants are engaged in the business of real estate and in support of their contention that the house was bought for commercial purpose is on the Developer. In the instant case, except for the bare pleading that the Complainants have another residence, there is no material to substantiate this contention. Keeping in view of what has been observed by this Commission in Aashish Oberai (supra), we hold that the Complainants are ‘Consumers’ and fall within the definition of ‘Consumer’ as defined in Section 2 (1) (d) of the Act.

10.     The next issue raised by the learned counsel is with respect to territorial jurisdiction, as it is mentioned in clause 42 of the Agreement  that only courts in Mohali will have territorial jurisdiction to entertain all disputes arising out of the said Agreement. Section 17 (2) a, b & c clearly stipulates that territorial jurisdiction would lie in any place where anyone of the Opposite Party resides, carries on business or has a branch office or where the cause of action wholly on in part arises. In the instant case the subject property is in Mohali and in their own communication, dated 24.09.2012 the letter head shows that their registered office is at Chandigarh. Having regard to the clear provision contained in Section 17 (2) of the Act it cannot be said that the U.T. State Commission at Chandigarh did not have territorial jurisdiction to entertain the Complaint.

11.     The next point that falls for consideration is whether the Developer was justified in contending that Clause 8 of the Agreement only specifies that the Developer would ‘endeavour’ to deliver within 12 months and that there was no definite date of delivery of possession in the Agreement. For better understanding of the case, Clause 8 on which reliance has been placed, is detailed as hereunder:

“8. Subject to force majeure condition and reasons beyond the control of the company, the company shall make every endeavour to deliver possession of the Plot to the Allottee(s) within a period of 12 (twelve) months from the date of execution of this Buyer’s  Agreement. In the event that the possession of the Plot is likely to be delayed for reason of any force majeure event  or any other reason beyond the control of the Company including government strike or due to civil commotion or by reason of war or enemy action or earthquake or any act of God or if non delivery is as a result of any act, notice, order, rule or notification of the Government and any other public or competent Authority or for any reason beyond the control of the Company, then in any of the aforesaid events, the Company shall upon notice claiming force majeure to the Allottee(s) be entitled to such extension of time till the force majeure even persists or the reason beyond the control of the Company exits. In the event that the Company fails to deliver possession of the Plot without existence of any force majeure event or reason beyond the control of the Company within 18 (eighteen) months form the date of execution of this Agreement, the Company shall be liable to pay to the Allottee(s), a penalty of the sum of ₹50/- (Rupees Fifty only) per sq. yard. Per month for such period of delay beyond 18 months from the date of execution of this Agreement. It is made clear to the Allottee(s) that under no circumstance the possession of the Plot will be handed over to the Allottee(s) prior to the execution of the Sale Deed/ Conveyance Deed.”

12.     If  the Developer’s stand  that time was not the essence of the Contract was to be accepted, then there was no reason for them to have offered compensation of ₹2,16,493/- to the Complainants towards delay in the delivery of possession. Further the aforenoted clause also mentions that if the Company fails to deliver the possession of the Plot without existence of any force majeure event, or reason beyond the control of the Company within 18 months form the date of execution of the Agreement, the Company shall be liable to pay to the ‘Allottees’, a penalty of the sum of ₹50/- per sq. yd. per month for such period of delay beyond 18 months from the date of execution of this Agreement. Hence, the arguments, being devoid of any merit is rejected.

13.     The next contention of the learned counsel appearing for the Developer that the said unit was relocated only based on the confirmation given by the Complainant on 25.06.2015, is  again unsustainable, in the light of the email which shows that there was no such confirmation and the Complainants only requested the Developer to ‘explore option for relocation’. It is the Complainants case that the letter dated 30.07.2015 which refers to the email dated 25.06.2015 simply states that the Complainants were being given an alternative Plot in lieu of the Original Plot, without ascertaining from the Complainants whether the offer of relocation was actually acceptable to them or not. In view of this, the contention of the learned counsel that the email dated 25.06.2014 amounts to  novation of contract cannot be accepted. Learned counsel for the Developer also relied on letter dated 16.07.2016, which is the letter of intimation of possession, which was sent almost after one year of intimation of change in the Plot. It is also relevant to note that the Complainants did not sign the amended Agreement which mentions the relocated Plot numbers. Even on 27.03.2015, the Complainants had only requested Ms. Sweta Verma Sinha in Sector 17 office to ‘hold the offer of possession temporarily’. It is pertinent to note that the said official had offered Plot No. 520 AG in the same Sector 109 on the ground that there would be a delay in the delivery of possession of the original Plot.

14.     It is significant to mention that on 27.07.2016 the Complainants had emailed to the Developer that they had not received any response to their letter dated 05.07.2016, except for the email dated 16.07.2016 and were once again requesting for refund of the amount deposited.

15.     This Commission in Emmar MGF Land Ltd. & Ors.  vs. Amit Puri [II (2015) CPJ 568 NC], which was not challenged and has attained finality, has laid down the principle that if the Developer does not deliver the possession within the promised date of delivery, the discretion lies with the  Complainants whether they would like to wait and take delivery, or seek refund of the amounts with interest and compensation. In the instant case, though Learned Counsel has strongly contended that there was no promised date of delivery of possession, the fact remains that the Developer was not even in a position to deliver the Original Plot  and was offering to the Complainants an alternative Plot, which was not acceptable to them. This Commission in Aashish Oberai (supra) relying on the decision of the Hon’ble Supreme Court in Chand Rani Vs. Kamal Rani [Civil Appeal No. 3377 of 1979] has rejected the contention of the Developer that time is not the essence of the Contract in a transaction for sale of immoveable   property.  This contention also came to be considered by this Commission in Consumer Complaint No. 315 of 2015 Pradeep Narula Vs. M/s. Granite Gate Properties Pvt. Ltd. & Anr. decided on 23.8.2016 and this Commission observed as follows:

          "10................Moreover, the decision in Chand Rani (supra) was rendered in the context of a suit for specific performance of an agreement to sell the first floor of an existing house, whereas the decision in the Hind Construction (supra) was rendered in the context of a Government contract. In neither of these cases, the Hon'ble Supreme Court was called upon to decide as to whether an unjustified and explained delay on the part of the builder/service provider in construction of a residential flat booked by a person seeking to have a shelter over his head amount to a deficiency in the service rendered by him to the consumer, or not. The primary purpose of a consumer in booking a residential flat which the builder is to construct for him, is to start living in that house on or about the date committed to him by the builder for delivering possession of the flat booked by him. If the builder does not deliver upon his contractual obligation and at the same time, is unable to show that the delay in completion of the flat and offering its possession to the consumer was on account on circumstances beyond his control, this would constitute deficiency on the part of the builder/service provider in rendering services to the consumer. If I accept the contention that the builder can indefinitely postpone and delay the construction of the flat and the flat buyer has no option but to wait till the builder decides to complete the construction and offer possession to the buyer, that would be nothing but a travesty of justice and result in a situation where the flat buyer is left at the mercy of the builder, without recourse to an appropriate legal remedy. Such an interpretation, if taken, is bound to defeat the very objective behind the enactment of the Consumer Protection Act, as far as housing construction is concerned. Therefore, I am unable to accept the contention advanced by the learned counsel for the opposite party. In my view, wherever the builder commits a particular date or time frame for completion of the construction and offering possession to the buyer, he must necessarily honour the commitment made by him, though a minor delay may not constitute deficiency in the service rendered by him to the buyer. Of course, if the builder is able to how that the delay in completion of the construction and offering possession to the buyer is attributable wholly to the circumstances beyond his control, that may not be a case of deficiency in the services rendered to the consumer".

16.     Learned counsel for the Developer vehemently contended that compensation ought to be paid only as per what was stipulated in Clause 8 of the Builder Buyer Agreement. A similar contention came to be rejected by this Commission in Swarn Talwer & Ors. Vs. Unitech Limited, Consumer Complaint No. 347 of 2014 decided on 14.8.2015, and the following was the view taken by this Commission:

     “....... As regards the plea that in terms of Clause (c) of the allotment letter the opposite party is required to pay only the holding charges calculated at the rate of Rs.5/- per sq.ft. per month of the super area for the period the possession is delayed, such a contention was expressly rejected by us in Puneet Malhotra (supra) holding that such clause applies only in a case where construction of the flat is delayed but despite delay the buyer accepts the possession of the flat from the seller and consequently the accounts have to be settled between the parties. We observed in this regard that the buyer would have to pay the agreed holding charges to the seller and the seller to pay the agreed compensation on account of delaying the construction of the flat. The said clause, however, does not apply to a case where the buyer on account of delay on the part of the seller in constructing the flat is left with no option but to seek refund of the amount which he had paid to the seller. We further held that such a clause where the seller in case of default on the part of the buyer seeks to recover interest from him at the rate of 24% per annum will amount to an unfair trade practice since it gives an unfair advantage to the seller over the buyer. We also noted in this regard that enumeration of the unfair trade practices in Section 2(r) of the Act is inclusive and not exhaustive.

17.     Being aggrieved by the order passed by this Commission, the opposite party approached the Hon'ble Supreme Court by way of an Appeal. The said Civil Appeal D.No.35562/2015 was dismissed by the Hon'ble Supreme Court vide its order dated 11.12.2015 which reads as under:-

"We have heard learned counsel for the appellant and perused the record. We do not see any cogent reason to entertain the appeal. The judgement impugned does not warrant any interference.

The Civil Appeal is dismissed."

18.     We find force in the submission of the Complainants that they cannot be made to wait endlessly for delivery of possession of Original Plot and at the same time the offer made by the Developer regarding the alternative Plot is not acceptable  to them as it is in a different sector and area.

19.     For all the aforenoted reasons, we do not see any illegality or infirmity in the finding of the State Commission that the Developer was deficient in his service. Learned counsel appearing for the Complainants contended that when the contractual rate of interest charged by the Developer was 24% p.a. for any delayed payments, the rate of interest awarded by the State Commission is justified. However we are of the considered view that interest @ 15% compounded quarterly  awarded by the State commission is excessive keeping in view the lower bank rates; the judgement of this Commission in Amit Puri (supra) and also the recent judgements of the Hon’ble Supreme Court wherein simple interest @ 12% p.a. is awarded, we are of the considered view that awarding simple interest @ 12% p.a. would meet the ends of justice.

20.     Hence, the Appeal is allowed in part, directing the Developer  to refund the deposited amount of  ₹47,64,862/- with simple interest @ 12% p.a. from the respective dates of deposit till the date of realisation. Since interest @12% p.a. has already been awarded by way of damages, we set aside the compensation of ₹2,00,000/-.  However, we concur with the finding of the State Commission regarding costs of ₹50,000/-. The penal interest awarded @18% p.a. compounded quarterly on both the deposited amount and on the compensation and costs, is set aside.

21.     It is observed that this Commission vide order dated 17.05.2017 had granted stay to the Developer subject to its depositing in this Commission total amount deposited by the Complainants with them with interest @ 9% p.a. from the respective date of deposits. Needless to add, this amount shall be refunded to the Complainants and the balance amount due in terms of this order shall be remitted by the Developer to the Complainants within six weeks from the date of receipt of a copy of this order, failing which the amount shall attract interest @ 14% p.a. for the belated period.

22.     The Statutory Deposit shall stand transferred to the Consumer Welfare Fund.