
Radhey Shyam Bhardwaj filed a consumer case on 20 Nov 2017 against M/s Emaar MGF Land Limited in the StateCommission Consumer Court. The case no is CC/351/2017 and the judgment uploaded on 28 Nov 2017.
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
U.T., CHANDIGARH
Complaint case No. | : | 351 of 2017 |
Date of Institution | : | 21.04.2017 |
Date of Decision | : | 20 Nov. 17 |
Radhey Shyam Bhardwaj son of Sh.Satya Prakash Bhardwaj, Resident of House No.264, Ward No.11, State Bank House (above SBI), Circular Road, Rewari District Rewari.
.……Complainant
.... Opposite Parties
Complaint under Section 17 of the Consumer Protection Act, 1986.
BEFORE: MR. DEV RAJ, PRESIDING MEMBER.
MRS. PADMA PANDEY, MEMBER.
Argued by: Sh.Narender Kaajla, Advocate for the complainant.
Sh.Sanjeev Sharma, Advocate for the Opposite Parties.
PER PADMA PANDEY, MEMBER
The present complaint has been filed by the complainant, seeking compensation by way of interest on the deposited amount of Rs.58,35,058/-, for delay in handing over possession of unit no.TVM G3-F01-103 (in short the unit), purchased by him, in the project of the opposite parties, named “The Views”, SAS Nagar, Mohali, Punjab. It was alleged by the complainant that as per Agreement dated 29.09.2011, the opposite parties were liable to hand over actual physical possession of the unit, in question, within a period of 36 months from the date of allotment i.e. from 24.08.2011, but when the same was offered in the month of October 2016 i.e. after a long delay, it was found incomplete. Ultimately, possession of the unit, in question, was handed over to the complainant on 24.02.2017. It was stated that not only as above, various illegal charges were levied by the opposite parties, in respect of the unit, in question, such as external development charges, taxes etc. It was further stated that, on account of small delay in making payment towards price of the said unit, the opposite parties had charged huge amount of interest @15% per annum compounded quarterly. It was further stated that the act of the opposite parties, in the first instance, making promise to hand over possession of the unit, in question, complete in all respects, latest by 28.09.2014 (infact 23.08.2014) but by not doing so, amounted to deficiency in providing service and also adoption of unfair trade practice. By stating as above, the instant complaint has been filed by the complainant, seeking directions to the opposite parties to pay interest on the deposited amount, for the period of delay aforesaid; execution and registration of sale deed; not to charge any amount towards the illegal charges, referred to above; compensation for mental agony & physical harassment and also litigation expenses.
It was further stated that, earlier, the complainant had filed consumer complaint bearing no.886 of 2016 before this Commission, which was withdrawn, vide order dated 07.12.2016, with liberty to file a fresh one after giving better particulars. Hence this complaint.
We are not going to agree with the objection raised. In a case titled as ‘Sarbjit Singh Vs. Puma Realtors Private Limited’, IV (2016) CPJ 126, this Commission has elaborately dealt with this question, while relying upon ratio of judgments of the Hon’ble Supreme Court, titled as Fair Air Engg. Pvt. Ltd. & another Vs. N. K. Modi (1996) 6 SCC 385, C.C.I Chambers Coop. Housing Society Ltd. Vs Development Credit Bank Ltd. (2003) 7 SCC 233, Rosedale Developers Private Limited Vs. Aghore Bhattacharya and others, (Civil Appeal No.20923 of 2013), Secretary, Thirumurugan Cooperative Agricultural Credit Society v. M. Lalitha (2004) 1 SCC 305 and United India Insurance Co. Ltd. Vs. M/s Pushpalaya Printers, I (2004) CPJ 22 (SC), and LIC of India and another Vs. Hira Lal, IV (2011) CPJ 4 (SC), and held that even in the face of existence of arbitration clause in an Agreement form, 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. Furthermore, under similar circumstances, the National Commission, 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, held as under:-
“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.”
Furthermore, the National Commission in a case titled Omaxe Limited Vs. Dinesh Lal Tarachandani, First Appeal No.1433 of 2016, decided on 24.11.2016, while dismissing the appeal filed by the builder, held as under:-
“We are unable to persuade ourselves to agree with the Learned Counsel. In our opinion, the decision of the State Commission being based on the authoritative pronouncements by the Hon’ble Supreme Court and also on the decision dated 02.05.2016, rendered by this Bench in the case of Lt. Col. Anil Raj & Ors. Vs. M/s Unitech Limited & Ors. in CC No. 346/2013, in which we have held that notwithstanding the amendments in the Arbitration Act, the reasoning and ratio of the decision of the Hon’ble Supreme Court, in the case of Secretary, Thirumurugan Cooperative Agricultural Credit Society Vs. M. Lalitha (Dead) Through LRs. & Ors. (Supra) still holds good, no fault can be found with the view taken by the State Commission.
Consequently, the Appeal fails and is dismissed accordingly.”
Recently, the larger Bench of the National Commission in a case titled as Aftab Singh Vs. Emaar MGF Land Limited & Anr., Consumer Case No. 701 of 2015, vide order dated 13.07.2017, has held that an Arbitration Clause in the Agreements, between the complainant and the Builder cannot circumscribe the jurisdiction of a Consumer Fora, notwithstanding the amendments made to Section 8 of the Arbitration Act. In view of the above, objection raised by the opposite parties in this regard, being devoid of merit is rejected.
No doubt, in the written version, an objection was also taken by the opposite parties that as per Clause 43.6 of the Agreement, the Punjab and Haryana High Court at Chandigarh, shall have Jurisdiction, to entertain and adjudicate the dispute(s) in respect of the unit, in question, and, as such, the Jurisdiction of this Commission was barred. It may be stated here that all the provisions of the Code of Civil Procedure are not applicable, except those, mentioned in Section 13 (4) of the Act, to the proceedings, in a Consumer Complaint, filed under the Act. For determining the territorial jurisdiction, to entertain and decide the complaint, this Commission is bound by the provisions of Section 17 of the Act. In Associated Road Carriers Ltd., Vs. Kamlender Kashyap & Ors., I (2008) CPJ 404 (NC), the principle of law, laid down, by the National Commission, was to the effect, that a clause of Jurisdiction, by way of an agreement, between the Parties, could not be made applicable, to the Consumer Complaints, filed before the Consumer Foras. It was further held, in the said case, that there is a difference between Sections 11/17 of the Act, and the provisions of Sections 15 to 20 of the Civil Procedure Code, regarding the place of jurisdiction. In the instant case, as held above, a part of cause of action arose to the complainant, within the territorial Jurisdiction of this Commission, at Chandigarh. In Ethiopian Airlines Vs Ganesh Narain Saboo, IV (2011) CPJ 43 (SC)= VII (2011) SLT 371, the principle of law, laid down, was that the restriction of Jurisdiction to a particular Court, need not be given any importance in the circumstances of the case. In Cosmos Infra Engineering India Ltd. Vs Sameer Saksena & another I (2013) CPJ 31 (NC) and Radiant Infosystem Pvt. Ltd. & Others Vs D.Adhilakshmi & Anr I (2013) CPJ 169 (NC) the agreements were executed, between the parties, incorporating therein, a condition, excluding the Jurisdiction of any other Court/Forum, in case of dispute, arising under the same, and limiting the Jurisdiction to the Courts/Forums at Delhi and Hyderabad. The National Commission, in the aforesaid cases, held that such a condition, incorporated in the agreements, executed between the parties, excluding the Jurisdiction of a particular Court/Forum, and limiting the Jurisdiction to a particular Court/Forum, could not be given any importance, and the complaint could be filed, at a place, where a part of cause of action arose, according to Sections 11/17 of the Act. The principle of law, laid down, in the aforesaid cases, is fully applicable to facts of the instant case. It may also be stated here, that even if it is assumed for the sake of arguments, that the complainant had agreed to the terms and conditions of the agreement, limiting the Jurisdiction to the Courts, referred to above, the same could not exclude the Jurisdiction of this Commission, at Chandigarh, where a part of cause of action accrued to the complainant, to file the complaint. The submission of Counsel for the opposite parties, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected.
“ It is evident from a bare perusal of Sections 21, 17 and 11 of the Consumer Protection Act that it’s the value of the goods or services and the compensation, if any, claimed which determines the pecuniary jurisdiction of the Consumer Forum. The Act does not envisage determination of the pecuniary jurisdiction based upon the cost of removing the deficiencies in the goods purchased or the services to be rendered to the consumer. Therefore, the cost of removing the defects or deficiencies in the goods or the services would have no bearing on the determination of the pecuniary jurisdiction. If the aggregate of the value of the goods purchased or the services hired or availed of by a consumer, when added to the compensation, if any, claimed in the complaint by him, exceeds Rs. 1.00 crore, it is this Commission alone which would have the pecuniary jurisdiction to entertain the complaint. For instance if a person purchases a machine for more than Rs.1.00 crore, a manufacturing defect is found in the machine and the cost of removing the said defect is Rs.10.00 lacs, it is the aggregate of the sale consideration paid by the consumer for the machine and compensation, if any, claimed in the complaint which would determine the pecuniary jurisdiction of the Consumer Forum. Similarly, if for instance, a house is sold for more than Rs.1.00 crore, certain defects are found in the house, and the cost of removing those defects is Rs.5.00 lacs, the complaint would have to be filed before this Commission, the value of the services itself being more than Rs.1.00 crore. ”
In view of above, in the present case, the total value of the unit, in question, plus compensation by way of interest on the deposited amount, for the period of delay and also for mental agony and physical harassment claimed by the complainant, in the present case, if added, will definitely fall above Rs.20 lacs and below Rs.1 crore. In no way, the aggregate of value of the unit, in question and reliefs claimed, exceed Rs.1 crore. Thus, this Commission has got pecuniary Jurisdiction, to entertain and decide the complaint. Such an objection taken by the opposite parties, that this Commission lacks pecuniary Jurisdiction, being devoid of merit, must fail and the same stands rejected.
“ 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. In fact, this was also the view taken by this Commission in Rajesh Malhotra & Ors. Vs. Acron Developers Pvt. Ltd. & Ors. First Appeal No. 1287 of 2014 decided on 05.11.2015.”
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 parties, in their written reply, therefore, being devoid of merit, is rejected.
“What relief can be granted to a consumer, in case of delay, in offering possession, came up for consideration before the Hon’ble National Commission, in a case titled as Parsvnath Exotica Ghaziabad Resident's Association Vs. Parsvnath Buildwell Pvt. Ltd. & Anr., consumer complaint no.45/2015, decided by the Hon’ble National Commission, on 06.05.2016, wherein, it was argued by the project proponent that at the maximum, as provided in the Agreement, the consumer will be entitled to claim penalty for delayed compensation @Rs.5/- per square feet, per month. Noting that in case of delay in making payment, the project proponent was charging heavy penal interest, instead of penal amount, the interest on the deposited amount, for the period of delay was granted, by holding as under:-
“Though, the Agreement between the developer and the flat buyers provides for payment of compensation in case of delay @ Rs.5/- per square feet of the super area per month, such clauses have been found to be unfair trade practice and have been consistently rejected by this Commission in several decision, including Consumer Complaint No. 427 of 2014 Satish Kumar Pandey & Ors. Vs. Unitech Ltd. and connected matters decided on 08.6.2015. Therefore, the aforesaid clauses cannot be taken into consideration, while determining the compensation payable to the members of the complainant association for the aforesaid delay in completion of construction.”
Not only this, in another case, titled as Capt. Gurtaj Singh Sahni & anr. Vs Manager, Unitech Limited & anr., consumer complaint bearing no.603/2014, decided on 02.05.2016, the Hon'ble National Commission, directed the opposite party/builder to pay interest on the deposited amount, for the period of delay, till delivery of possession of the unit. Relevant contents of the said order reads thus:-
“8. If the compensation for the delay in construction is restricted to what is stipulated in the Buyers Agreement, there will be no pressure upon the builder to complete the construction since he will be more than happy to keep on paying paltry compensation of about 3% per annum of the capital investment, instead of arranging funds at much higher cost, to complete the construction.
9. xxxxxxxxxxxxx
10. For the reasons stated hereinabove, the complaints are disposed of with the following directions:
(1) xxxxxxxxxxxxxx
(2) The opposite party shall pay compensation in the form of simple interest @ 12% per annum from the expected date of possession till the date on which the possession is actually offered to the complainants after completing the construction in all respects and obtaining the requisite completion certificate.”
Thus, keeping in view the principle of law laid down by the Hon'ble National Commission, in the cases, referred to above, if interest @12% on the deposited amount for the period of delay, till delivery of possession of the unit, is awarded, that would meet the ends of justice.”
Keeping in view the facts and circumstances of the case and the fact that the complainant is in possession of the unit, in question, on 24.02.2017, interest @10% on the deposited amount for the period of delay i.e. w.e.f. 23.08.2014 to 24.02.2017 (date when possession handed over), if granted in favour of the complainant, would meet the ends of justice.
At the same time, the plea taken by the opposite parties, to the effect that the complainant is not entitled for any compensation, for the period of delay in handing over possession of the unit, in question, as he was defaulter in making payment of installments is also devoid of merit. It may be stated here that it is an admitted fact that the opposite parties failed to offer possession of the unit, in question, by the stipulated date, as they could not complete the construction. Thus, if it is so, the complainant was well within his right, to withhold the amount (in the present case, for very few days, as is evident from the record), in view of principle of law laid down in Prasad Homes Private Limited Vs. E.Mahender Reddy and Ors., 1 (2009) CPJ 136 (NC), wherein it was held that when development work was not carried out at the site, the payment of further installments was rightly stopped by the purchaser. Even otherwise, the opposite parties have levied heavy rate of interest on the delayed payment, as is evident from statement of account Annexure C–10, at page 46 of the file. They have not left the complainant and have penalized him heavily for that. As such, once they, instead of exercising their right of cancelling the allotment, proceeded further by waiving the delay, by charging of delayed payment interest, now it is not open to them, to raise such an objection.
Secondly, such a plea has no legs to stand, also in view of decision rendered by the National Commission, in a case titled as Puneet Malhotra Vs Parsvnath Developers Ltd., II (2015) CPJ 18 (NC), wherein under similar circumstances it was observed and held as under:-
“If some of the allottees had not made timely payment, it was for the opposite party to arrange the requisite finance either by taking loan or from its own resources or by liquidating Inventory at a lower price”.
No help, therefore, can be drawn by the opposite parties out of the objection, raised by them, in this regard.
Pronounced
20 Nov. 17
Sd/-
(DEV RAJ)
PRESIDING MEMBER
Sd/-
(PADMA PANDEY)
MEMBER
Rg.
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