Chandigarh

StateCommission

CC/398/2016

Mr. Rakesh Aggarwal - Complainant(s)

Versus

M/s Emaar MGF Land Limited - Opp.Party(s)

D.S. Soundh Adv.

28 Feb 2017

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

Complaint case No.	:	398 of 2016
Date of Institution	:	26.07.2016
Date of Decision	:	28.02.2017

 

1. Rakesh Aggarwal s/o Sh. Ved Parkash Aggarwal c/o House No.884, Sector 21, Panchkula.
2. Ms. Mani Mukhija w/o Sh. Rakesh Aggarwal, c/o House No.884, Sector 21, Panchkula, through their GPA holder Sh.Ved Parkash Aggarwal s/o Sh.G.R.Aggarwal, c/o House No.884, Sector 21, Panchkula.

……Complainants

V e r s u s

M/s Emaar MGF Land Limited, SCO No.120-122, First Floor, Sector 17-C, Chandigarh – 160017, through its Managing Director.  

                                                    .... Opposite Party

Argued by:      

 

Sh.  D.S.Soundh, Advocate for the complainants.

Sh.  Sanjeev Sharma, Advocate for the Opposite Party.

 

Complaint case No.	:	399 of 2016
Date of Institution	:	26.07.2016
Date of Decision	:	28.02.2017

 

1. Mr. Mukesh Aggarwal s/o Sh. Ved Parkash Aggarwal c/o House No.884, Sector 21, Panchkula.

 

2. Ms. Pooja w/o Sh. Mukesh Aggarwal, c/o House No.884, Sector 21, Panchkula.

……Complainants

V e r s u s

M/s Emaar MGF Land Limited, SCO No.120-122, First Floor, Sector 17-C, Chandigarh – 160017, through its Managing Director. 

                                                     .... Opposite Party                 

BEFORE:         JUSTICE JASBIR SINGH (RETD.), PRESIDENT

                        MR. DEV RAJ, MEMBER.

                        MRS. PADMA PANDEY, MEMBER

 

Argued by:      

 

Sh.  D.S.Soundh, Advocate for the complainants.

Sh.  Sanjeev Sharma, Advocate for the Opposite Party.

 

PER PADMA PANDEY, MEMBER

 

              By this order, we propose to dispose of, following cases:-

1.	CC/398/2016	Rakesh Aggarwal & Anr.	Vs.	M/s Emaar MGF Land Ltd.
2.	CC/399/2016	Mukesh Aggarwal & Anr.	Vs.	M/s Emaar MGF Land Ltd.

2.           Arguments were heard in common, in the above cases, as the issues involved therein, except minor variations, here and there, of law and facts, are the same.

3.           At the time of arguments, on 18.01.2017, it was agreed between Counsel for the parties, that facts involved in both the complaints, by and large, are the same, and therefore, these complaints can be disposed of, by passing a consolidated order.

4.           Under above circumstances, to dictate order, facts are being taken from Consumer complaint bearing No. 398 of 2016, titled as “Rakesh Aggarwal  & Anr. Vs. M/s Emaar MGF Land Limited”.

5.           The facts, in brief, are that the Opposite Party floated a scheme for allotment of residential plots under the name and style of “Mohali Hills – inspired living” and it started promoting the scheme much before even the actual drawings were made and even before the actual grant of licence to develop the land was granted. Initially, the original buyer booked one plot of 250 sq. yds. in the project of the Opposite Party by depositing an amount of Rs.5 lacs and provisional allotment letter regarding plot No.16 in Sector 104, Mohali was allotted in favour of the original buyer for the total basic price of Rs.42,50,000/- plus PLC and other charges (Annexures C-1 & C-2). It was stated that before execution of the Agreement, the plot was transferred in the name of the complainants vide letter dated 20.09.2010 (Annexure C-3) and, therefore, the complainants stepped into the shoes of the original buyer. The complainants continued to make further payment of installments, as required from time to time vide receipts (Annexure C-4). Copy of the Buyer’s Agreement dated 21.11.2011 is Annexure C-5. As per Clause 8 of the Agreement, the Opposite Party had promised to hand over possession within a period of 18 months. It was further stated that the plot was not ready for possession by the promised time, therefore, the complainants were entitled to refuse the possession and seek refund of the amount with interest or take possession alongwith penalty and compensation. It was further stated that the Opposite Party committed to pay Rs.50/- per sq. yd. per month for delay in delivering possession but it failed to honour its commitment. It was further stated that the Opposite Party collected huge amount of money from the general public without having any intention to deliver physical possession of the promised plot. It was further stated that the complainants paid the amount to the Builder by obtaining a home loan (Annexure C-6). It was further stated that the plot is not fully developed, as there was no sewerage, water or electricity available at the plot and also the title is defective. It was further stated that the Opposite Party did not have any requisite approvals for its project. It was further stated that the aforesaid acts, on the part of the Opposite Party, 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.

6.           The Opposite Party, in its written version, has taken objection regarding arbitration clause in the Agreement, and also it had separately, moved an application u/s 8 of Arbitration and Conciliation Act, 1996 taking a specific objection in this regard for referring the matter to the Arbitrator in terms of the agreed terms and conditions of the Agreement.  It was stated that the prayer for possession of the plot is not maintainable as the same amounts to specific performance of the contract which is beyond the power of the Consumer Courts and such power can only be exercised by the Civil  Courts. It was further stated that the plot of the complainants are falling under the wrongly constructed road by GMADA and letters for rectifying the said error, wherein a second road has been wrongly constructed by GMADA has been filed by the Opposite Party Company with the department and the same is under consideration and the said mistake would be rectified by GMADA in two or three months. It was further stated that the Opposite Party committed to provide the possession of the plot by May, 2017.  It was further stated that this Commission has no pecuniary jurisdiction as well as territorial jurisdiction to try and entertain the complaint. It was further stated that the complainants purchased another unit No.17 in the name of their brother Sh.Mukesh Aggarwal in same sector as well as a flat No.H-206 at Sector 66, Gurgaon. The complainants are already owning a house at Panchkula, wherein, they are residing with their father and besides this, the complainants are having another residential unit at 301, Ivoy Court IV, Essel Tower M.G.Road, Gurgaon, Haryana. It was further stated that the complainants did not fall within the definition of “consumer” as per Section 2(1)(d) of the Consumer Protection Act, as they purchased these properties only for commercial gains/speculation by selling them at higher rates. It was further stated that both the parties are bound by the terms and conditions of the Agreement and it is clearly stipulated in the Agreement that in case of failure of the allottee to perform all obligations as set out in the Agreement, the allottee has authorized the Company to forfeit the earnest money as stipulated in Clause 2(f) of the Agreement alongwith any interest paid, due or payable, any amount of non refundable nature. It was further stated that earlier the plot was allotted to Sh.Ashish Mittal and the complainants are subsequent purchasers. The said plot was transferred in the name of the complainants on 20.09.2010. It was admitted regarding issuance of provisional allotment letter and execution of the Agreement. It was admitted that the Company received an amount of Rs.50,21,500/- against the unit. It was further stated that the complainants were habitual defaulters and they did not pay the installments on time, despite issuance of various letters/reminders. It was further stated that as per Clause 8 of the Agreement, the Company shall “endeavour” to deliver possession not later than 18 months from the date of execution of the Agreement. It was well within the knowledge of the complainants that time was not essence of the contract and for any delay, a stipulated penalty had been provided within the Agreement to safeguard the right of the allottees. It is well settled principle of law that in cases of sale of immovable property and construction, time is never regarded as the essence of the contract. It was further stated that the compensation is payable by the Company @Rs.50/- per sq. yard per month and would be taken up for consideration and credited in the account of the complainants at the time of possession. It was further stated that the Opposite Party has got all the necessary permissions and approvals and even partial completion certificate from the competent authorities.  It was further stated that neither there was any deficiency, in rendering service, on the part of the Opposite Party, nor it indulged into unfair trade practice.

7.           The complainants filed rejoinder to the written statement of the Opposite Party, wherein they reiterated all the averments, contained in the complaint, and refuted those, contained in the written version of the Opposite Party. 

8.           The Parties led evidence, in support of their case.

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

10.          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 Party, 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 Party, stands rejected.

11.          The next question that falls for consideration, is, as to whether, this Commission has 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, it is evident from the record, that Plot Buyer’s Agreement was executed between the allottee(s) and the Opposite Party at Chandigarh. Not only this, even the receipts/acknowledgment-cum-receipt(s) and letters (Annexures C-1 to C-4),  were also sent by the Opposite Party from its Chandigarh Office, as the same bore the address of the Company as “SCO 120-122, First Floor, Sector 17-C, Chandigarh”. Since, as per the documents, referred to above, a part of cause of action arose to the complainants, at Chandigarh, this Commission has got territorial Jurisdiction to entertain and decide the complaint.  The objection taken by the Opposite Party, in its written version, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected. 

12.          Another objection taken by the Opposite Party, with regard to pecuniary jurisdiction, also deserves rejection. It may be stated here that the complainants in the prayer clauses of the complaint sought possession of the unit alongwith interest or refund the entire deposited amount of Rs.50,21,500/- alongwith interest @15% p.a.;  Rs.5 lacs as token compensation to compensate the complainants for the premium amount paid and the opportunity cost, which would occur to them if they have to buy the similar size plot from some other source ; Rs. 3 lacs as compensation for physical and mental harassment ; Rs.1 lac as deterrent charges ; Rs.1 lac as punitive damages and Rs.55,000/- as legal costs. At the time of arguments, the Counsel for the complainants, on getting instructions from the complainants, confined their prayer only to get refund, compensation and interest etc., as they (complainants) are not interested in getting possession, as it is already delayed. In the present case, the Opposite Party admitted that the complainants deposited the total amount of Rs.50,21,500/- in respect of the unit, in question. So, if we counted the deposited amount of Rs.50,21,500/- alongwith compensation and litigation expenses, aggregate value whereof [excluding the interest claimed] fell above Rs.50 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. This issue has already been elaborately dealt with by this Commission in Surjit Singh Thadwal Vs. M/s Emaar MGF Land Pvt. Ltd. & Anr., Consumer Complaint No.484 of 2016, decided on 15.12.2016. Relevant portion of the aforesaid judgment reads thus :-

“13.  Now we will deal with another contention of the opposite parties that for want of pecuniary jurisdiction, it is not open to this Commission to entertain and adjudicate this complaint.  As per admitted facts, the complainant has sought refund of amount paid i.e. Rs.48,95,264/- alongwith interest @12% p.a. from the respective date of deposits; compensation to the tune of Rs.5 lacs, for mental agony and physical harassment and cost of litigation to the tune of Rs.55,000/-. It is argued by Counsel for the opposite parties that if his entire claimed amount is added, alongwith interest claimed, it will cross Rs.1 crore and  in that event it will not be open to this Commission to entertain and adjudicate this complaint, for want of pecuniary jurisdiction. To say so, reliance has been placed upon ratio of judgment of a Larger Bench of the National Commission, in the case of Ambrish Kumar Shukla (supra). In the said case, it was specifically observed that when determining pecuniary jurisdiction of the Consumer Foras, it is the value of the goods and services, which has to be noted and not the value of deficiencies claimed. Further, that interest component also has to be taken into account, for the purpose of determining pecuniary jurisdiction.

14.         In the first blush, if we look into the ratio of the judgment, referred to above, it appears that this Commission will not have pecuniary jurisdiction to entertain this complaint.  However, on deep analysis, we are going to differ with the argument raised by Counsel for the opposite parties.  Judgment in the case of Ambrish Kumar Shukla (supra) was rendered by Three Judges Bench of the National Commission, without noting its earlier view of the subject. This issue, whether, when determining pecuniary jurisdiction of the State Commission/ Consumer Foras, interest is to be added with other relief claimed or not, came up for consideration, before the Three Judges Bench of the National Commission in Shahbad Cooperative Sugar Mills Ltd. Vs. National Insurance Co. Ltd. And Ors., II 2003 CPJ 81 (NC). In the said case, noting similar arguments, it was observed as under:-

“3. Complaint (at pp 17-36) was filed with the following prayer :

“It is, therefore, respectfully prayed that the complaint be allowed and the opposite parties be directed to pay the claim to the tune of Rs. 18,33,000/- plus interest @ 18% from the date of claim till its realization. Also the suitable damages caused to the complainant be ordered to be paid to the complainant.”

4. Bare reading of the prayer made would show that the interest claimed by appellant pertains to the period upto the date of filing complaint, pendente lite and future. Rate and the period for which interest has to be allowed, is within the discretion of State Commission and the stage for exercise of such a discretion would be the time when the complaint is finally disposed of. Thus, the State Commission had acted erroneously in adding to the amount of Rs. 18,33,000/- the interest at the rate of 18% per annum thereon till date of filing of complaint for the purpose of determination of pecuniary jurisdiction before reaching the said stage. Order under appeal, therefore, deserves to be set aside. However, in view of change in pecuniary jurisdiction w.e.f. 15.3.2003, the complaint is now to be dealt with by the District Forum instead of State Commission.”

 

15.         It was specifically stated that interest claimed by appellant/complainant pertained to the period upto the date of filing complaint, pendente lite and future, need not be added in the relief claimed, to determine pecuniary jurisdiction of the State Commission/Consumer Foras. It was rightly said that the rate and period for which the interest has to be allowed, is within the discretion of the particular Consumer Fora, and the stage for exercise of such discretion would be the time, when final order is passed. We are of the considered opinion that the view taken is perfectly justified. There may be cases, where the complainant may not be entitled to claim any interest upon the amount paid, like the one, where he is rescinding his contract and  further at what rate interest is to be granted will be determined by the competent Consumer Fora, by looking into the facts of each case. All cases cannot be put into a straitjacket formula, to add interest claimed, to determine pecuniary jurisdiction of the Consumer Foras. The interest, which is a discretionary relief, cannot be added to the value of the goods or services, as the case may be, for the purpose of determining the pecuniary jurisdiction of the Consumer Foras. As per provisions of the Consumer Protection Act, 1986 (Act) value of the goods purchased or services plus (+) compensation claimed needs to be added only, for determining pecuniary jurisdiction of the Consumer Foras.

                As per ratio of the judgment of the Supreme Court in the case of New India Assurance Co. Ltd. Vs. Hilli Multipurpose Cold Storage Pvt. Ltd., Civil Appeal No.10941-10942 of 2013, decided on 04.12.2015, we would like to follow the view expressed by Three Judges Bench (former Bench) of the National Commission in Shahbad Cooperative Sugar Mills Ltd. case (supra), in preference to the ratio of judgment passed by a Bench of co-equal strength (subsequent Bench) of the National Commission in the case of Ambrish Kumar Shukla case (supra).

                In New India Assurance Co. Ltd. case (supra), it was specifically observed by the Supreme Court that when a former Bench of co-equal strength has given a finding qua one legal issue, it is not open to the subsequent Bench of co-equal strength to opine qua that very legal issue and give a contrary finding. At the maximum, the subsequent Bench of co-equal strength can refer the matter to the President/Chief Justice of India to constitute a bigger Bench, to look into the matter and reconsider the legal proposition. It was further specifically held that, in case, there are two contrary views by the former and later co-equal strength Benches, the former will prevail. It was so said by looking into the ratio of judgment rendered by the Five Judges Bench of the Supreme Court of India, in Central Board of Dawoodi Bohra Community & Anr. Vs. State of Maharashtra & Anr. (2005) 2 SCC 673, wherein, when dealing with similar proposition,  it was observed as under:-

 

“12. Having carefully considered the submissions made by the learned senior counsel for the parties and having examined the law laid down by the Constitution Benches in the abovesaid decisions, we would like to sum up the legal position in the following terms :-

(1) The law laid down by this Court in a decision delivered by a Bench of larger strength is binding on any subsequent Bench of lesser or co-equal strength.

(2) A Bench of lesser quorum cannot disagree or dissent from the view of the law taken by a Bench of larger quorum. In case of doubt all that the Bench of lesser quorum can do is to invite the attention of the Chief Justice and request for the matter being placed for hearing before a Bench of larger quorum than the Bench whose decision has come up for consideration. It will be open only for a Bench of coequal strength to express an opinion  doubting the correctness of the view taken by the earlier Bench of coequal strength, whereupon the matter may be placed for hearing before a Bench consisting of a quorum larger than the one which pronounced the decision laying down the law the correctness of which is doubted.

(3) The above rules are subject to two exceptions : (i) The abovesaid rules do not bind the discretion of the Chief Justice in whom vests the power of framing the roster and who can direct any particular matter to be placed for hearing before any particular Bench of any strength; and

(ii) In spite of the rules laid down hereinabove, if the matter has already come up for hearing before a Bench of larger quorum and that Bench itself feels that the view of the law taken by a Bench of lesser quorum, which view is in doubt, needs correction or reconsideration then by way of exception (and not as a rule) and for reasons given by it, it may proceed to hear the case and examine the correctness of the previous decision in question dispensing with the need of a specific reference or the order of Chief Justice constituting the Bench and such listing. Such was the situation in Raghubir Singh and Hansoli Devi.”

16.         In Ambrish Kumar Shukla case (supra), ratio of judgment-Shahbad Cooperative Sugar Mills Ltd. (supra) was not even discussed and considered. In view of above proposition of law laid down by the Five Judges Bench in Central Board of Dawoodi Bohra Community & Anr.`s and also Three Judges Bench of the Supreme Court, in New India Assurance Co. Ltd. Vs. Hilli Multipurpose Cold Storage Pvt. Ltd. case (supra), it is not open to the Bench of co-equal strength to give contrary findings, to the view already expressed by a Former Bench of same strength. In Shahbad Cooperative Sugar Mills Ltd. case (supra), decided on 02.04.2003, it was specifically observed by Three Judges Bench of the National Commission that when determining pecuniary jurisdiction of the Consumer Foras, interest component claimed by the complainant/party, is not to be added. We are of the considered view that in view of proposition of law, as explained above, the view taken in Shahbad Cooperative Sugar Mills Ltd. case (supra), to determine pecuniary jurisdiction without taking interest claimed, will prevail. As such, in the present case, we are not looking into the interest claimed by the complainant, when determining pecuniary jurisdiction of this Commission.  If the interest part is excluded, the amount claimed in the relief clause fell below Rs.1 crore and above Rs.20 lacs. Hence, this Commission has pecuniary jurisdiction to entertain and decide the present complaint. In view of above, the objection raised by the opposite parties, in this regard, being devoid of merit, must fail and the same stands rejected.”

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 Party, that this Commission lacks pecuniary Jurisdiction, being devoid of merit, must fail and the same stands rejected.

13.          The objection taken by the Opposite Party, to the effect that the complainants are already having a house in Panchkula, wherein, they are residing with their father and besides this, they are having another residential unit at 301, Ivory Court IV, Essel Tower M.G.Road, Gurgaon, Haryana and, as such, they are speculators/investors, did not fall within the definition of a consumer, as defined by Section 2 (1) (d) (ii) of the Act, also deserves rejection. The complainants in para No.10 of the complaint clearly stated that they had invested in the plot of land with the hope that their family would have a home of their own in their native place. 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 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  the  Opposite Party that the  complainants being investors/speculators, 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.  Therefore, it would not be correct to say that in every case where a person owns more than one house, the acquisition of the house is for a commercial purpose.”

 

 

               

                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  the Opposite Party, in its written reply, therefore, being devoid of merit, is rejected.  

14.          Another objection raised by Counsel for the Opposite Party was that since the prayer for possession of the plot is not maintainable, as the same amounts to specific performance of the contract, which is beyond the power of the Consumer Courts and such power can only be exercised by the Civil Court. It may be stated here, that this is a simple case of non-delivery of possession of the unit, in question, despite making substantial amount towards the same i.e. denial of service by the Opposite Party. It has also been clearly held by the Hon’ble   Supreme Court of India, in Lucknow   Development   Authority   vs   M.  K. Gupta, 1994 SCC (1) 243, that   if   a   builder   fails   to   deliver   possession of   the   property   by   the   stipulated   period,   the    delay  so  caused   is   denial   of   service.   Apart from this, it may be stated here that the complainants hired the services of the Opposite Party, for purchasing the plot, in question, in the manner, referred to above. According to Clause 8 of the Agreement, subject to force majeure conditions and reasons, beyond the control of the Opposite Party, it was to deliver physical possession of the plot, within a maximum period of 18 months, from the date of execution of the same (Agreement). Section 2 (1) (o) of the Act, defines service as under:-

“service” means service of any description which is made available to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing insurance, transport, processing, supply of electrical or other energy, board or lodging or both,  housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service”

                  From the afore-extracted Section 2(1)(o) of the Act, it is evident that housing/construction, also comes within the definition of a service. In Narne Construction P. Ltd., etc. etc. Vs.  Union Of India and  Ors. Etc., II (2012) CPJ 4 (SC),  it was held that when a person applies for the allotment of a building or site or for a flat constructed by the Development Authority and enters into an agreement with the Developer, or the Contractor, the nature of transaction is covered by the expression ‘service’ of any description. Housing construction or building activity carried on by a private or statutory body constitutes ‘service’ within the ambit of Section 2(1)(o) of the Act. Similar principle of law, was laid down, in Haryana Agricultural Marketing Board Vs. Bishambar Dayal Goyal & Ors. (AIR 2014 S.C. 1766). Under these circumstances, the complaint involves the consumer dispute, and the same is maintainable. Not only this, Section 3 of the Act provides an alternative remedy. Even if, it is assumed that the complainants have a remedy to file a suit, for specific performance, in the Civil Court, the alternative remedy provided under Section 3 of the Act, can be availed of by them, as they fall within the definition of consumer, as stated above. Not only this, in the present case, at the time of arguments, the Counsel for the complainants made a statement that the complainants confined their prayer only to get refund, compensation, interest etc. and they are not interested in getting possession, as it is already delayed. So, the objection of the Opposite Party, in this regard, being devoid of merit, must fail, and the same stands rejected.

15.          Another objection raised by Counsel for the Opposite Party that since it was mentioned in the Agreement that the Company “endeavour” to deliver possession of the unit within a period of 18 months from the date of Agreement, as such, time was not the essence of contract, is also devoid of merit. It may be stated here that it was clearly mentioned in Clause 8 of the Agreement that subject to force majeure conditions and reasons beyond the control of the Company, the Company endeavour to hand over possession of the unit within a maximum period of 18 months from the date of execution of the Agreement. At this stage, the plea of the Opposite Party is that the plot of the complainants are falling under the wrongly constructed road by GMADA and, as such, the Opposite Party wrote a letter to rectify the said error and the same is under consideration, has also no value at all because if the GMADA committed any error, what was the fault of the complainants and why should the complainants suffer ? In the instant case, the Opposite Party did not raise any force majeure circumstances, if any, encountered by it. In the absence of any force majeure circumstances having been faced by the Opposite Party or any other valid and legal reason beyond its control, the stand taken by it, in this regard, for condonation of delay in delivery of possession of the unit, to the complainants, cannot be taken into consideration. Thus, under these circumstances, since as per Clause 8 of the Agreement, the Opposite Party was bound to deliver possession of the unit, within a maximum period of 18 months from the date of execution of the Agreement, as such, time was,  unequivocally made the essence of contract.

                Even otherwise, the Opposite Party cannot evade its liability, merely by saying that since the word tentative/ proposed was mentioned in the Agreement, for delivery of possession of the unit and, as such, time is not to be considered as essence of the contract. Non-mentioning of exact date of delivery of possession of the unit(s) in the Buyer’s Agreement, is an unfair trade practice, on the part of the Builder. The builder is bound to mention the exact/specific date of delivery of possession of the unit(s) to the allottees/purchasers thereof.  It was so said by the Hon`ble National Commission, in Rajeev Nohwar & Anr. V/S Sahajanand Hi Tech Construction Pvt Ltd, 2016 (2) CPR 769. Relevant portion of the said case reads thus:-

“Merely making possession by a particular date will also not meet the requirement of law and the promotor is under a legal mandate to stipulate a specific date for delivery of possession of the flat in the agreement which he executes with the flat buyer”.

In view of above, the plea of the Opposite Party in this regard also stands rejected.

16.           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. As per Clause 8 of the Agreement, it is clear that possession of the unit was to be delivered within a maximum period of 18 months from the date of execution of the Agreement and not more than that. In the present case, Plot Buyer’s Agreement was executed between the parties on 21.11.2011 and the said period of 18 months has expired on 20.05.2013 but the Opposite Party failed to offer/deliver possession of the unit, complete in all respects, within the stipulated period, as mentioned in the Agreement or by the time when the complaint was filed.  Moreover, the Opposite Party already received a huge amount of Rs.50,21,500/-, towards the said unit. By making a misleading statement, that possession of the unit, was to be delivered within a period of 18 months, from the date of execution of the Agreement, the Opposite Party failed to abide by the commitments, as such, it was not only deficient, in rendering service, but also indulged into unfair trade practice.

17.          The next question, that falls for consideration, is, as to whether, the complainants are entitled to a refund of the amount of Rs.50,21,500/-, as claimed by them. It is an admitted fact that the complainants deposited an amount of Rs.50,21,500/-, as is evident from statement of account (Annexure R-3) and after receipt of the aforesaid huge amount, the Opposite Party failed to deliver  possession of the unit, in question. It is pertinent to note that the Opposite Party in para No.7 of its written statement committed to provide possession of the plot by May, 2017. It is well settled law that the purchaser/allottee cannot be forced for relocation to any other unit, unless and until the allottee(s) wishes to do so. The complainants cannot be made to wait for an indefinite period, for delivery of actual physical possession of the unit. The Opposite Party, 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 Party is also under an obligation to compensate the complainants, for inflicting mental agony and causing physical harassment to them.

18.          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.50,21,500/-, was paid by the complainants, without getting anything, in lieu thereof. The said amount has been used by the  Opposite Party, for its own benefit. There is no dispute that for making delayed payments, the  Opposite Party was charging heavy rate of interest (compounded quarterly @24% p.a.) as per Clause 3 of the Agreement, 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.50,21,500/- alongwith interest compounded quarterly @15%, from the date of transfer of the plot in the name of the complainants i.e. vide letter dated 20.09.2010 (Annexure C-3) till realization. 

19.          As far as the plea taken by the Counsel for the Opposite Party, at the time of arguments, regarding forfeiture of earnest money is concerned, it may be stated here that the same stands rejected, because it is not its (Opposite Party) case, that it was 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, due to deficiency in the services of the Opposite Party or for any personal reason, and is seeking refund of the amount deposited. Had this been the case of the Opposite Party, that it was willing to offer possession complete in all respects by the stipulated time, 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 Party, in this regard, has no legs to stand and is accordingly rejected.

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

21.          For the reasons recorded above, the complaint is partly accepted, with costs. The Opposite Party is directed, as under:-

1. To  refund   the  amount of Rs.50,21,500/-, to  the complainants, alongwith interest @ 15% compounded quarterly, from the date of transfer of the plot vide letter dated  20.09.2010 (Annexure C-3), 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.2,00,000/- for causing mental agony and harassment, to the complainants, 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.50,000/- to the complainants.
4. In case, the payment of amounts, mentioned in Clauses (i) and (ii), is not made, within the stipulated period, then the Opposite Party shall be liable to pay the amount mentioned in Clause (i) with interest @18% compounded quarterly, instead of @15% compounded quarterly, from the respective dates of transfer of the plot, till realization, and interest @15% compounded quarterly, on the  amount of compensation, mentioned in Clause (ii), from the date of filing the complaint, till realization, besides payment of litigation costs.

Complaint Case No.399 of 2016 titled ‘Mukesh Aggarwal & Anr. Vs. M/s Emaar MGF Land Limited’

 

22.          In the present complaint, the original buyer booked plot of 250 sq. yards and the original allottee was issued provisional allotment letter dated 01.09.2010 for plot No.17 in Sector 104, Mohali. The said plot was purchased by the complainants and, therefore, the transfer was made in favour of the complainants on 01.10.2010 (Annexure C-3). Plot Buyer’s Agreement was executed between the parties on 21.11.2011 (Annexure C-5) and as per Clause 8 of the Agreement, possession was to be delivered to the complainants within a maximum period of 18 months from the date of execution of Agreement i.e. latest by 20.05.2013. However, the Opposite Party failed to deliver/offer possession of the unit to the complainants.

23.          The Opposite Party admitted that the complainants purchased the plot in its project from the original allottee. It was also admitted regarding issuance of provisional allotment letter ; execution of the Agreement and receipt of the amount of Rs.50,21,500/- in respect of the unit, in question. The Opposite Party committed to hand over possession of the plot by May, 2017.  The other objections taken by the Opposite Party in its written statement is similar, as mentioned in connected case No.399 of 2016, so there is no need to reiterate it again.

24.          In view of the aforesaid admission of the Opposite Party regarding handing over of possession by May, 2017 is clearly proved that the Opposite Party neither in a position to deliver possession of the unit complete in all respects to the complainants, within the stipulated period, as mentioned in the Agreement, nor by the time when the complaint was filed, which amounted to deficiency in service and unfair trade practice.

25.          For the reasons recorded above, the complaint is partly accepted, with costs. The Opposite Party is directed, as under:-

i)     To  refund   the  amount of Rs.50,21,500/-, to    the complainants, alongwith interest @ 15%    compounded quarterly, from the date of transfer of the plot vide letter dated     01.10.2010 (Annexure C-3),   onwards, within     45 days, from   the  date of     receipt of a   certified copy of  this   order.

ii)    To pay compensation, in the sum of   Rs.2,00,000/- for causing mental agony and harassment, to the complainants, within 45        days, from the date of receipt of a certified        copy of this order.

iii)   To pay cost of litigation, to the tune of     Rs.50,000/- to the complainants.

iv)   In case, the payment of amounts, mentioned   in Clauses (i) and (ii), is not made, within the    stipulated period, then the Opposite Party       shall be liable to pay the amount mentioned     in Clause (i) with interest @18% compounded        quarterly, instead of @15% compounded   quarterly, from the date of transfer of the   plot, till realization, and interest @15%      compounded quarterly, on the  amount of        compensation, mentioned in Clause (ii), from the date of filing the complaint, till       realization, besides payment of litigation        costs.

26.          The Opposite Party filed application under Section 8 of the Arbitration and Conciliation Act, 1996 in the connected case i.e. CC/399/2016 also stands dismissed, as per the issue of arbitration already decided in main Consumer Complaint No.398 of 2016.           

27.          However, it is made clear that, if the  complainant(s), in all the aforesaid two cases, have availed loan facility from any banking or financial institution, for making payment of installments towards the said unit, it will have the first charge of the amount payable, to the extent, the same is due to be paid by the complainant(s).

28.          Certified copy of this order be placed in Consumer Complaint Nos.399 of 2016.

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

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

Pronounced.

February 28, 2017.                                        Sd/-      

[JUSTICE JASBIR SINGH (RETD.)]

[PRESIDENT]

 

Sd/-

 [DEV RAJ]

MEMBER

 

Sd/-

 (PADMA PANDEY)

        MEMBER

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