Chandigarh

StateCommission

CC/839/2017

Pankaj Awasthi - Complainant(s)

Versus

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

Abhinay Sharma, Adv.

12 Jul 2018

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

Complaint case No.	:	839 of 2017
Date of Institution	:	13.12.2017
Date of Decision	:	12.07.2018

 

1. Pankaj Awasthi, aged 44 years, S/o Mr.Jagdish Awasthi, House No.713, Sunny Enclave, Kharrar, Sector-125, Desu Majra, SAS Nagar, Mohali 140301, Punjab.
2. Monia Awasthi, aged 42 years, W/o Pankaj Awasthi, House No.713, Sunny Enclave, Kharrar, Sector-125, Desu Majra, SAS Nagar, Mohali 140301, Punjab.

 

……Complainants

V e r s u s

1. M/s Emaar MGF Land Pvt. Ltd., ECE House, 28 Kasturba Gandhi Marg, New Delhi – 110001, through its Chief Managing Director.
2. M/s Emaar MGF Land Pvt. Ltd., SCO 120-122, First Floor, Sector 17-C, Chandigarh 160017, through its Authorised Officer.

                                                 .... Opposite Parties

 

BEFORE:         JUSTICE JASBIR SINGH (RETD.), PRESIDENT

                        MR. DEV RAJ, MEMBER.

                        MRS. PADMA PANDEY, MEMBER

Argued by:       

 

Ms. Nevadita Sharma, Advocate for the complainants.

Sh. Ajiteshwar Singh, Advocate for the Opposite Parties.

 

PER PADMA PANDEY, MEMBER

             

              The facts, in brief, are that the complainants applied for purchase of a unit solely for residential purposes from the Opposite Parties in the residential colony namely ‘The Views’. Thereafter, Unit Buyer’s Agreement was executed between the parties on 07.04.2011 (Annexure C-1) for allotment of unit bearing No.TVM H3-F06-604, tower No.H3, measuring 1550 sq. ft., for which, the complainants paid the entire sale consideration of Rs.43,21,143/-. Copy of provisional allotment letter is Annexure C-2. As per Clause 21.1 of the Agreement, possession of the said unit was to be delivered within a period of 36 months from the date of allotment alongwith a grace period of 90 days for applying and obtaining the occupation certificate in respect of the Group Housing Complex. However, even after expiry of 80 months from the date of allotment, possession of the residential flat has not been handed over to the complainants. It was further stated that the Opposite Parties failed to intimate to the complainants about completion of the project. The complainants visited the site and found that the completion of the apartment could not be completed in near future. It was further stated that as per Clause  23.1 of the Agreement, in the event of delay, the Opposite Parties are liable to pay compensation for delay @Rs.5/- per sq. ft. per month of the super area but till date, nothing in terms of compensation has been received by the complainants. The complainants made repeated requests to the Opposite Parties to deliver possession of the unit but all in vain – Annexure C-7. It was further stated that the aforesaid acts, on the part of the Opposite Parties, 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.

2.           The Opposite Parties, in their written version, have taken objection regarding arbitration clause in the Agreement, and also they 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 further stated that the complainants did not fall within the definition of “Consumer” as per the Consumer Protection Act, 1986, as he is already owner in possession of a residential property being House No.713, Sunny Enclave, Sector 125, Desu Majra, SAS Nagar, Mohali, as such, the complainants are investors/speculators. It was further stated that the complainants breached the terms and conditions of the Agreement, as out of the total consideration of Rs.44,28,190.81, the complainants paid only an amount of Rs.43,21,143/-. It was further stated that the requisite permissions were duly obtained by the Opposite Parties. All other allegations leveled by the complainants have been denied by the Opposite Parties.  It was further stated that neither there was any deficiency, in rendering service, on the part of the Opposite Parties, nor they indulged into unfair trade practice.

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

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

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

6.           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 1996 Act, this Commission has no jurisdiction to entertain the consumer complaint. This question has already been elaborately dealt with by this Commission in case titled Mrs.Anjani Dass Vs. DLF Universal Limited, Complaint Case No.295 of 2017, decided on 19.07.2017. Para No.12 of the said order, inter-alia, being relevant, is extracted hereunder:-

“12.  At the time of arguments, it was also argued by Counsel for the opposite parties that in view of Section 8 of the Arbitration and Conciliation Act, 1996, this Commission has no jurisdiction to entertain the consumer complaint and let the matter be referred to an arbitrator for adjudication.

                We are not going to agree with the argument raised. This Commission, in a case titled as ‘Sarbjit Singh Vs. Puma Realtors Private Limited’, IV (2016) CPJ 126 has already 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, 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 (Omaxe), 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 complainants 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, argument raised by Counsel for the opposite parties, in this regard, being devoid of merit is rejected.”

             

            Against the order passed by the larger Bench of the Hon'ble National Consumer Disputes Redressal Commission, New Delhi, M/s Emaar MGF Land Limited filed Civil Appeal No.(s) 23512-23513 of 2017 in Hon’ble Supreme Court of India, which was also dismissed.

              In view of the above, the objection raised by Counsel for the Opposite Parties, being devoid of merit, is rejected.

7.           The next question, that falls for consideration, is, as to whether, the complainants fall within the definition of a consumer, as defined by Section 2 (1) (d) (ii) of the Act, or not. The Opposite Parties in their written statement that the complainants being owner of house in Sunny Enclave, Sector 125, Desu Majra, SAS Nagar, Mohali, as such, they purchased the said unit, in question, for investment/speculation purposes.  After going through the record, we are of the view that the objection taken by the Opposite Parties does not carry any weight and is liable to be rejected. The Opposite Parties have failed to place any document on record to prove that the complainants are the owner of house of Sunny Enclave property. It has been mentioned by the complainants, in para no.4 of their complaint that the complainants applied for the purchase of a flat solely for residential purposes from the Opposite Parties. Even otherwise, the mere fact that it was a residential unit, which was allotted, in favour of the complainants, was sufficient to prove that it was to be used for the purpose of residence, by the complainants. There is nothing, on the record, that the complainants are property dealers. Thus, in the absence of any cogent evidence, in support of the objection raised by the  Opposite Parties, mere bald assertion i.e. simply saying that the  complainants purchased the property for speculation purposes, as such, they did not fall within the definition of a consumer, cannot be taken into consideration. Further, in a case titled as Kavita Ahuja Vs. Shipra Estate Ltd. and Jai Krishna Estate Developer Pvt. Ltd. 2016 (1) CPJ 31, decided 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 Parties, in their written reply, therefore, being devoid of merit, is rejected.

8.           The next question, that falls for consideration, is, as to within which period the possession was to be delivered to the complainants. As per Clause 21.1 of the Agreement, possession of the unit was to be delivered within a period of 36 months from the date of allotment. The Company shall be entitled to a grace period of 90 days, after the expiry of 3 months for applying and obtaining the occupation certificate in respect of the Group Housing Complex. So, it is clear that possession of the unit, in question, was to be delivered within a maximum period of 36 months from the date of allotment. In the present case, allotment of apartment No.TVM H3-F06-604 was made to the complainants vide provisional allotment letter dated 25.03.2011 (Annexure C-2). Therefore, if we count 36 months from 25.03.2011, the possession was to be delivered by 24.03.2014 and not more than that. However, the Opposite Parties neither delivered possession of the unit to the complainants within the stipulated time frame, as mentioned in the Agreement nor at the time when the complaint was filed, which amounted to deficiency in service and indulgence into unfair trade practice.

9.           The next question, that falls for consideration, is, as to whether, the complainants are entitled to refund of the amount of Rs.43,21,143/-, as claimed by them. The Opposite Parties admitted that the complainants paid the total amount of Rs.43,21,143/-, as is evident from statement of accounts (Annexure R-3). Even the  Opposite Parties failed to give physical possession of the unit, in question, complete in all respects, within the stipulated period, as mentioned in the Agreement or even by the time when the complaint was filed. The complainants cannot be made to wait for an indefinite period, for delivery of actual physical possession of the unit purchased by them. The  Opposite Parties, 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 Parties are also under an obligation to compensate the complainants, for inflicting mental agony and causing physical harassment to them.

10.          It is to be further seen, as to whether, interest, on the amount refunded, can be granted, in favour of the  complainants. It is no doubt true that an amount of Rs.43,21,143/-, was paid by the complainants, without getting anything, in lieu thereof. The said amount has been used by the  Opposite Parties, for their own benefit. There is no dispute that for making delayed payments, the  Opposite Parties were charging heavy rate of interest (compounded 15% p.a.) as per Clause 20.1 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 alongwith interest @10% p.a., from the respective dates of deposits till realization. 

11.          As far as the plea taken by the Opposite Parties, regarding forfeiture of earnest money is concerned, it may be stated here that the same stands rejected, because it is not their (Opposite Parties) case, that they were 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 service rendered by the Opposite Parties or for  any  personal  reason,  and  are  seeking  refund  of the amount deposited. Had this been the case of the Opposite Parties, 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 Parties, in this regard, has no legs to stand and is accordingly rejected.

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

13.          For the reasons recorded above, the complaint is partly accepted, with costs. The  Opposite Parties are jointly and severally directed as under:-

1. To refund the amount of Rs.43,21,143/-, to  the  complainants, alongwith interest @10% p.a.,  from the respective dates of deposits onwards.
2. To pay compensation, in the sum of     Rs.1,50,000/-, for causing mental agony and physical harassment, to the complainants.
3. To pay cost of litigation, to the tune of Rs.33,000/- to the  complainants.
4. The payment of awarded amounts mentioned at sr.nos.(i) to (iii), shall be made, within a period of 02 (two) months from the date of receipt of a certified copy of this order, failing which, the amount mentioned at sr.no.(i) shall carry penal interest @12% p.a., instead of @10% p.a., from the date of default, and interest @10% p.a., on the amounts mentioned at sr.nos.(ii) and (iii), from the date of filing of this complaint, till realization.

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

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

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

Pronounced.

July 12^th, 2018                                      

[JUSTICE JASBIR SINGH (RETD.)]

[PRESIDENT]

 

 

 [DEV RAJ]

MEMBER

 

 

 (PADMA PANDEY)

        MEMBER

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