BEFORE THE KARNATAKA STATE CONSUMR DISPUTES REDRESSAL COMMISSION, BENGALURU (PRINCIPAL BENCH)

DATED: 30^th DAY Of AUGUST 2022

PRESENT

HON’BLE Mr. JUSTICE HULUVADI G. RAMESH: PRESIDENT

Mr KRISHNAMURTHY B. SANGANNANAVAR: JUDICIAL MEMBER

Mrs DIVYASHREE M: LADY MEMBER

Consumer Complaint No.125/2020

Biddappa C G,

S/o Ganapathy C S,

Aged about 32 years,

R/a Kanoor Village and Post,

Virajpet Taluk, Kodagu District,

Presently R/a,

No.40/1, Nanjappa Circle,

(By Mr. M K Lokesh, Adv.) 

-Versus-

1. M/s Max Worth Realty India Ltd,

KMP House, No.12/2,

Yamuna Bai Road,

Rep. by its Director,

Sagar. H G.

2. Kesava K,

Chairman Cum Managing Director,

Max Worth Realty India Ltd,

No.12/2, KMP House,

Yamunabai Road,

Madhavanagar,

(By Mr. Subramani K.V, Adv.)

BY Mrs. M.DIVYASHREE : LADY MEMBER

******

//ORDER//

1. This is a complaint filed under Section 17 of Consumer Protection Act, 1986, to direct OPs to refund the amount of Rs.23,25,000/- paid by the complainant and interest at the rate of 18% p.a. to the said amount which comes of Rs.9,50,000/- from May 2017 upto June 2020, in total amount of Rs.32,75,000/-, to direct OPs to pay the amount of Rs.10,00,000/- towards compensation for suffering by way of inconvenience, mental agony, harassment and loss, to direct OPs to pay the amount of Rs.2,00,000/- for travelling charges and litigation expenditure, to direct OPs to pay towards delay in delivery of possession and rent paid by the complainant to his land lord of Rs.5,00,000/- and other reliefs as the Commission deems fit.

2. This complaint is received on 23.06.2020 through advocate came to be admitted and ordered notice against OP1 and OP2 of whom OP2 put his appearance through advocate and submits version.  The Commission held an enquiry by receiving affidavit evidence of complainant and got marked the documents as Ex.C1 to Ex.C26.  OP2 fails to submit affidavit evidence.  After closure of enquiry, having heard the learned counsel for complainant, the Commission has to decide on the alleged rendering deficiency of service on the part of OP, and if it is shown, what reliefs could be granted in favour of complainant?

3. It is the case of the complainant that, initially he booked a plot in Max Nandana Residency III and OPs have allotted Site No.33, measuring 30ft x 40ft, Rs.900/- per Sq.ft. on 13.06.2015 and complainant produced document Ex.C3 for having paid an advance amount of Rs.50,000/- to the OPs by way of cheque.  Thereafter OPs have informed that the above sites formed in agriculture property and those sites will not get loan from the banks. Admittedly, based on the representation and assurance made by OPs the complainant transferred the said amount to Max Keerthana II, site No.29, measuring 1459 sq.ft., Rs.930/- per sq.ft., on 18.08.2016 and additional amount of Rs.25,000/- paid by complainant to the OPs by way of cheque.  The booking form of Max Nandana Residency III and Max Keerthana II are produced herewith and marked as Ex.C1 and Ex.C2.

4. Further stated that, in the meanwhile OPs have formulated a scheme of development of the Luxury Living at Affordable Price apartment complex called “MAX MADHURA” residential apartment.  Again after sometime the OPs have requested complainant to transfer the amount to Max Madhura on 28.01.2017 giving a same reason as I will not get loan for the said site and then OPs have adjusted and transferred to Max Madhura.  Based on OPs instructions and seeing their brochures of “Dream Home” complainant booked the flat as per the OPs representations for two bed room flat as per the OPs representations for two bed room flat measuring 900 sq.ft., and the OPs have offered price for Rs.3,100/- per sq.ft., on total flat cost of Rs.34,62,500/- (includes Flat cost, car parking, BWSSB/KPTCL, Club House, Gen Set and Legal/Maintenance).  Further OPs have agreed to adjust the earlier payment made to the above said projects and assured to complete the present project within 16 months as already 75% of work was completed.  The Booking Form of Max Madhura and brochure are produced and marked as Ex.C3 and Ex.C4.

5. Heard the arguments, admittedly as per the documents marked as Ex.C14 Agreement of Sale and Ex.C15 Construction Agreement both dated on 05.04.2017 with the OPs and they had agreed to slot, construct and convey the flat No.514, two bedrooms, Hall, Kitchen and Dining, bathroom/toilet, balcony and utility etc., in super built area of 900 sq.ft., facing north, type 2, situated at “Max Madhura”, Doddabettahalli Village, Yelahanka Hobli, Bengaluru North Taluk and along with undivided share, rights, title and interest more fully described in the schedule and herein after called as Schedule Property.  The OPs assured to execute Sale Deed and hand over the possession of the schedule property as per construction agreement on or before 16 months with grace period 02 months additionally from the date of Sale Agreement. 

6. Further, it is the case of the complainant that, after complainant entered into Agreement of Sale with the OPs on 05.04.2017 and when the matter stood thus, the complainant applied loan in LIC Housing Finance Ltd., to purchase the schedule property.  The LIC HFL sanctioned loan of Rs.21,50,000/- on 28.04.2017 and LIC HFL have released the amount of Rs.17,00,000/- as per schedule payments were made according to Agreement of Sale dated 05.04.2017 and complainant paid in total amount of Rs.23,25,000/- out of total Sale Consideration amount of Rs.34,62,500/-.  As per Sale Agreement the remaining balance consideration amount is required to be paid by complainant as per schedule on completion of the project, registration of sale deed and handing over of possession schedule property.  The Ledger Statement and Receipts are produced and marked as Ex.C15 to Ex.C20.

7. The complainant further alleged that despite repeated follow ups and demand the OPs fail to complete the project within 16 months as assured by them in the agreement of sale, dated 05.04.2017.  Moreover, the complainant alleges that he is residing in the rented premises and hence he entered into agreement for sale with the OPs on intention to buy a flat, to avoid paying the rent and the same may be adjusted towards the payment of EMI to the LIC HFL.  Because of the OPs breach/default he suffered huge financial loss and also he is paying rent of Rs.12,000/- per month from February 2019 along with EMI amount of Rs.14,647/- per month.  However, the OPs have failed to deliver the completed Schedule Residential Apartment to complainant within a period as agreed by the OPs.  Even complainant continuously follows up with the OPs to complete and hand over of the Schedule Residential Apartment, but till the date the OPs have failed to deliver the said Apartment to complainant as per the terms of agreement of sale.

8. Further to be noted herein that from Ex.C22/ copy of legal notice coupled with postal receipts and postal acknowledgment marked as Ex.C23 to C25.

9. Complainant has reiterated the contents of the complaint in the evidence and placed as many as 26 documents.  The complainant has submitted that on 05.04.2017 an agreement of sale is entered between complainant and OPs.  So far they have paid Rs.23,25,000/- out of the total sale consideration amount of Rs.34,62,500/-.  In such circumstances, affidavit evidence coupled with Ex.C1 to Ex.C26 would establish the alleged deficiency in service on the part of OPs.

10.   It is clearly mentioned in the clause-5 of the Sale Agreement, to complete the project on or before 16 months with grace period of 02 months additionally from the date of Sale Agreement.  The Agreement for sale and Construction Agreement both dated 05.04.2017 are produced and marked as Ex.C14 and Ex.C15.  But facts remain that OPs failed to complete the project as promised under agreement of sale.

11.  The facts in the said case is that the Consumer had filed a complaint before this Commission seeking the OP/developer be directed to refund amount paid by apartment/flat buyer on account of inordinate delay in completing construction and for which the complainant has also lost good faith on the OPs in executing the absolute Sale Deed and handover possession in respect of flat No.514 of Max Madhura.  Further the complainant has produced the copy of letter dated 01.09.2019 sent by the OPs to the complainant for cancelation of booking at Annexure-J marked as Ex.C21.  The complainant submits that, as per the agreement entered between the OPs and complainant, the OPs have no right to cancel the booking unilaterally when the complainant refused to pay the enhance amount and fraudulently the OPs have been prolonging to complete the construction work by giving one or other reasons for which the complainant has suffered heavy loss.

12. Further, it is the case of the complainant that since the OPs had collected the funds pertaining to the project, the OPs are liable to deliver possession of allotted flat/apartment or to refund the amount collected.  On perusal of the Ledger Statement and Receipts marked as Ex.C15 to Ex.C20 produced by the complainant, it could be seen that the collection of funds pertaining to the project are in the following manner;
    1. Rs.1,25,000/- (Inv.No.1596, dated 28.01.2017, Rs.50,000/-, No.1603, dated 29.01.2017, Rs.25,000/- and Inv.No.1625, dated 03.12.2017, Rs.50,000/-)

2. Rs.2,00,000/- by way of cheque bearing no.000033, dated 06.02.2017, drawn on HDFC Bank, Bangalore, receipt no.BLR/16-17/0910, dated 08.02.2017.

3. Rs.2,00,000/- by way of cheque bearing no.000034, dated 06.03.2017, drawn on HDFC Bank, Bangalore, receipt no.BLR/16-17/2012, dated 06.03.2017.

4. Rs.10,00,000/- by way of cheque bearing no.160672, dated 17.05.2017, drawn on HDFC Bank, Bangalore, receipt no.BLR/17-18/0077, dated 24.05.2017.

5. Rs.1,00,000/- by way of cheque bearing no.751429, dated 27.06.2019, drawn on HDFC Bank, Bangalore, receipt no.BLR/17-18/0109, dated 08.07.2019.

6. Rs.7,00,000/- by way of cheque bearing no.57480, dated 24.08.2019, drawn on HDFC Bank, Bangalore, receipt no.BLR/17-18/0203, dated 04.09.2019.

Hence one thing is clear that the transaction took place between the complainant and OPs.  Funds have been collected from the complainant.

13.  Further, it is observed that the OP/developer could not force for booking cancellation formalities and compel the complainant/ apartment buyers to be bound by the one sided contractual terms contained in the apartment buyers agreement, which constitutes to an unfair trade practice as contemplated under Section 2(1)(r) of the Consumer Protection Act.  In the circumstances, Commission held that since OPs had failed to deliver possession of allotted flat/apartment to complainant/buyer, it amounts to deficiency in service, and the complainants were entitled to refund the amount along with appropriate compensation.

14. The complainant was deprived of his hard earned money, on the basis of misleading information given by the OPs, that he would be handed over the legal physical possession of the apartment/flat, in question, by the stipulated time, but they failed to do so.  The complainant, was thus, caused financial loss.  The hard earned money of the complainant was utilized by the OPs, for a sufficient longer period.  If 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.  Under these circumstances, in our considered opinion, if interest @ 12% p.a., on the amount paid by the complainant, that will serve the ends of justice. Since the actions or omissions on the part of OPs amount to unfair trade practice besides amounting to deficiency in service.  The complainant needs not to wait for any indefinite time to complete the project undertaken by OPs. In such circumstances, it would be just and proper to direct the OPs to refund the amount received from the complainants along with interest at 12% p.a. from the date of receipt till realization.  The complainant having been invested such huge amount waited till now, are to be held suffered with mental agony and entitle for some amount of compensation which is quantified at Rs.2,00,000/-. 

15. Accordingly, we proceed to allow this complaint partly and OPs are jointly and severally liable to refund Rs. 23,25,000/- along with interest @ 12% p.a. from the date of receiving the amount from the complainant till realization and do pay Rs.2,00,000/- towards compensation and Rs.25,000/- towards cost of litigation.  OPs are directed to comply with this order within 03 months from the date of this order.

16. Furnish free copy of this order to both parties.

  Lady MemberJudicial MemberPresident

*GGH*