1. The present Consumer Complaints have been filed under Section 21(a) (i) of the Consumer Protection Act, 1986 (for short “the Act”) by the Complainants against the Opposite Party, M/s Emaar MGF Land Ltd. (hereinafter to be referred to as “Opposite Party”) seeking a direction to them to hand over the possession of the Apartments booked by the Complainants and to pay delay compensation or in alternative to refund the deposited amount with interest @ 24%. from the date of each payment till the amount is actually refunded. 

2. Since the facts involved in both the Complaints are similar except for minor variations in the Unit Numbers and their Sale Consideration, these Complaints are being disposed of by this Common Order. However, for the sake of convenience, the facts have been taken from the Consumer Complaint No. 3699 of 2017.

3. Brief facts as narrated in the Complaint, are that the Opposite Party which is engaged in the business of real estate, had launched a Group Housing Scheme known as “PALM HILLS” (for short “the Project”) in Sector 77, Urban Estate Haryana. Allured by the representations and assurances given by them that necessary approvals for the Project have been obtained and the possession would be handed over within a period of 33 months from the date of booking, the Allottees/Buyers of the said Project applied for booking of their respective houses/Apartments by paying the Application amount. Thereafter, they were allotted their respective Units in the said Project vide Allotment Letters and accordingly, the identical Builder-Buyer Agreements (hereinafter to be referred to as “the Agreement”) were executed between the parties. According to the Complainants, the terms and conditions of the Agreement were one-sided, unfair, unjust and arbitrary. The Complainants are not the original Allottees. On the promise of the Opposite Party that the date of possession as committed in the Agreement executed with the Original Allottee will remain unchanged, the Complainants herein purchased the Apartment No. PH-3-37-0401 admeasuring 1450 sq. fts. from the Original Allottees on 08.08.2012 by paying the agreed amount to the Original Allottee. The Opposite Party were informed about the transfer which was acknowledged by them after payment of transfer charges and they also transferred the respective Apartment in the name of the Complainants. An Acknowledgement Letter was also issued by the Opposite Party authenticating the transfer and amount which was received by them from the original allottee was credited in the Complainant’s Account. It is averred by the Complainants that the Agreement was executed on 30.12.2010 and as per Clause 11(a) of the Agreement, the possession of the Apartment was supposed to be handed over within 33 months from the date of start of construction. The construction at the site was started on 25.05.2011 and as such the possession of the Apartment purchased by the Complainant was to be handed over on 25.02.2014. Clause 11(a) of the Agreement is reproduced as under:- 

“Subject to terms of this clause and subject to the Allottee(s) having complied with all the terms and conditions of this Buyer’s Agreement, and not being in default under any of the provisions of this Buyer’s Agreement and compliance with all provisions, formalities, documentation, etc as prescribed by the Company, the Company proposes to hand over the possession of the Unit within 33 months from the date of start of construction, subject to timely compliance of the provisions of the Buyer’s Agreement by the Allottee. The Allottee(s) agrees and understands that the Company shall be entitled to a grace period of three months, for applying and obtaining the completion certificate/occupation certificate in respect of the Unit and/or the Project.” 

 

4. According to the Complainants, they regularly visited the site but were shocked to see that the construction was never in progress and even no one was present at the site to reply to any query. The site seemed to be an abandoned piece of land with only a skeleton structure of semi constructed building. It is averred that the total Sale Consideration of the Apartment was ₹66,99,471/- out of which they had paid a sum of ₹64,10,571/-  to the Opposite Party. However, despite having received the said huge amount i.e. 95% of the total Sale Consideration, the Opposite Party has miserably failed to deliver the possession of the Apartment in terms of the Agreement. It is further stated that the Opposite Party had charged 5th and 7th installments towards parking charges, however, in the sanctioned plan only 18 Car Parking Slots have been made available for 180 Apartments. The matter was taken up with the Opposite Party and they arbitrarily shifted the car parking space to 500 mtrs. Away from the Apartments. It is also stated that as per Clause 13(a) of the agreement, the Opposite Party is liable to pay a delayed compensation @₹7.5 per sq. ft. per month which comes only to approximately @1.4% p.a. and as such the Opposite Party has found a cheap source of funding the other commercial Projects. Due to amendment in Service Tax Law, the Complainants are bound to pay the hike in service tax only because of delay on the part of the Opposite Party in completing the construction and handing over the possession. Feeling aggrieved, the Complainants filed the present Complaint with the following prayers:-

“(i) Direct the O.P. to handover the possession of the apartment of the Complainant complete in all respects to the complainants immediately as per the Buyer’s Agreement and execute all the necessary and required documents in respect of the said apartment in favor of the complainants and further direct the O.P. to pay a compensation in form of interest @12% P.A from the committed date of possession till the actual possession of the apartment is delivered to the complainant. 

 

OR 

 

in alternative refund the entire amount paid to the O.P along with interest @24% from the date of each payment till the amount is refunded back to the complainants

 

ii.  Direct the O.P to allot proper parking spaces to the complainant as per the terms of the buyers agreement to the complainants.

 

iii. Grant immunity to the complainants from payment of any charges incurred due to any escalation in cost including enhanced service tax.

 

iv. Direct the O.P. to pay a sum of ₹ 5,00,000/- (Rupees five lakhs only) to the complainants towards the mental agony and harassment and the cost of litigation.”

 

5. Upon notice, the Opposite Party has filed its Written Version denying the contents of the Complaint and further stating that the Complainants already have a permanent place of residence in Delhi and had booked the Apartment in question for investment/commercial purpose to reap financial benefit and the Complainants are the Investors; Complainants had purchased the Apartment from the original allottee Mrs. Pooja Lumba and as such they do not have any locus-standi to file the complaint; possession of the Apartment has already been offered to the Complainant vide letter dated 09.10.2017 upon grant of Occupation Certificate dated 03.10.2017, however despite receipt of said offer of possession, the Complainants have not made any compliance thereof; the Apartment in question is mortgaged with LIC Housing Finance Ltd (for short, “the LIC”) and the Complainants are required to submit a NOC from the LIC, however the Complainants have not furnished the NOC till date; the Complaint is bad for misjoinder of party as LIC Housing Finance Ltd. is not impleaded in the array of parties; the Complainants agreed to the terms and conditions of the Agreement at the time of transfer of allotment and they also agreed that they shall not be entitled to claim any compensation for delay; allegations of inducement, coercion and fraud cannot be decided in summary proceedings and require extensive evidence to be led by both the parties, therefore the dispute raised in the present Complaint is beyond the purview of this Hon’ble Commission;  the Complainants had agreed to the penalty in nature of liquidated damages @₹ 7.50/- per sq. ft. per month for any delay in handing over the possession and the Complainants have not challenged the terms of the Agreement, thus the Complainants are bound by the terms of the Agreement; construction at the site started in May, 2011 and basic construction including internal tile flooring was completed in April, 2014; allottees have defaulted in making timely payments which resulted in slow development of the Project; Clause 11 (a) of the Agreement cannot be read in isolation and has to be read along with Clauses 12, 14, 17 & 27 which contemplates that delay in possession for any Force Majeure event will be excluded from the period of 33 months; it is impermissible to vary from the terms of the Agreement as has been held by the Hon’ble Supreme Court in the case of The Managing Director, Orix Auto Finance (India) Ltd Vs. Shri Jagmander Singh & Anr. (2006) 2 SCC 598; further reliance has been placed on Bharathi Knitting Co. Vs. DHL World-Wide Courier (1996) 4 SCC 65 and GDA Vs. Balbir Singh 2004 (5) SCC 65 whereby the Hon’ble Supreme Court has held that the Agreement is final and binding between the parties; compensation, if any, is to be granted to Consumers only for any loss or injury suffered by the Consumer as is held by the Hon’ble Supreme Court in Chief Administrator, HUDA & Anr. Vs. Shakuntala Devil - Civil appeal No. 7335 of 2008, compensation should be just and equivalent as held by the Hon’ble Supreme Court in Ghaziabad Development Authority versus Balbir Singh JT 2004(5) SC 17; this Commission cannot entertain the complaint for want of pecuniary jurisdiction as the possession has already been offered to the Complainants on 09.10.2017 and by no stretch of imagination compensation, if any, can exceed ₹ 1 crore; complaint is barred by limitation; the Complainants has not disclosed any cause of action; the disputes is to be settled by a sole Arbitrator appointed under the manner as envisaged in Clause 33 of the Agreement and therefore, in view of the submissions as made above, the Opposite Party No. 1 have prayed that the Complaint be dismissed with exemplary costs. 

6. We have heard the learned Counsel for the Parties and also perused the material available on record.

7. The Complaints have been resisted by the Opposite Party on several grounds but, those grounds are stated to have already been considered and rejected by this Commission in the case of Jivitesh Nayal & Anr. Vs. M/s. Emaar MGF Land Ltd. – Consumer Complaint NO. 34 of 2015 & connected matters decided on 02.11.2017. In the said decision, dealing with the similar grounds as taken in the present complaints, the Co-ordinate Bench of this Commission has held as under:-

"3. The complaint has been resisted by the opposite party which has taken a preliminary objection that since the agreed consideration was less than Rupees One crore, this Commission lacks pecuniary jurisdiction to entertain the complaint.　On merits, the allotment made to the complainant as well as the execution of the Builder Buyer Agreements with them, has been admitted. The payments made by the complainants have also not been disputed. It is claimed that in view of Clause 15 of the Builder Buyer Agreement, in the event of delay, the complainants are entitled only to compensation calculated at Rs.10/- per sq. ft. per month. The construction, according to the opposite party, is in full swing. It is alleged that all possible efforts are being made to complete the construction and deliver possession to the complainants.　

 

In terms of Section 21 of the Consumer Protection Act, this Commission possesses the requisite pecuniary jurisdiction to entertain a consumer complaint, where the value of the goods or services as the case may be, and the compensation, if any, claimed in the complaint, exceeds Rupees One Crore. As held by a Three-Members Bench of this Commission in CC No.97 of 2016 Ambrish Kumar Shukla & Ors. Vs. Ferrous Infrastructure Pvt. Ltd.,　decided on 07.10.2016, the value of services in such cases, means the sale consideration agreed to be paid by the flat buyer to the builder. The following view was taken by this Commission in CC/198/2015 Dushyant Kumar Gupta Vs. Today Homes & Infrastructure Pvt. Ltd. & connected matters, decided on 31.1.2017, and containing almost identical prayers, is relevant, as far as the issue of pecuniary jurisdiction is concerned:-

 

“The main question which arises for consideration in these complaints is as to whether this Commission possesses the requisite pecuniary jurisdiction to entertain these complaints. As provided in section 21 of the Consumer Protection Act this Commission has jurisdiction to entertain the complaints where the value of the goods or services and compensation if any claimed exceeds Rs.1 crore. Though most of the complainants have claimed refund @ Rs.10,000/- per sq.ft. of the area of the flat, no credible evidence has been led by them to prove that the market value of a flat similar to the flat allotted to them and in the same or a comparable locality was Rs.10,000/- or more on the date these complaints were instituted. No price list of any developer in respect of residential flats in the same or a comparable locality with identical or comparable specifications has been produced by them, in the absence of a credible evidence, it would be difficult to accept the bald statements of the complainants as regards the market value of a similar flat in the same or a comparable locality, on the dates these complaints were instituted. Therefore, invocation of the pecuniary jurisdiction of this Commission on the basis of the aforesaid alleged market value of the similar flats is highly misplaced and cannot be entertained.

 

5.　  This Commission has in the past granted compensation in the form of interest paid Rs.18% per annum in the cases where refund has been allowed and compensation in the form of interest @ 12% per annum in the cases where possession of the house/plot has been directed. Therefore, a claim for refund by adding the agreed sale consideration to compensation in the form of simple interest @ 18% per annum from the date of each payment till the date of filing of the complaint cannot be said to be highly exaggerated or fanciful and made only with a view to invoke the jurisdiction of this Commission, even if this Commission eventually grants a lesser compensation to the complainant. Similarly, where the complainant seeking only the possession of the house but there is no prayer for refund of the payment made by him to the builder, the value arrived it by adding the agreed sale consideration to the compensation in the form of interest @ 12% p.a. from the committed date of possession till the date of filing of the complaint would be maintainable before this Commission if the said claim comes to more than Rs.1 crore.

 

6. In a complaint where the complainant makes alternative prayers, one for possession of the house allotted/plot to him and the other for refund of the amount paid by him to the developer along with compensation, this Commission would have pecuniary jurisdiction to entertain the complaint where either the relief of possession or the relief of refund, alongwith the compensation as calculated in terms of para-5 hereinabove falls within the pecuniary jurisdiction of this Commission. Since in such a case, the State Commission will not have the requisite pecuniary jurisdiction to grant one of the alternative reliefs claimed in the complaint, the complainant cannot be asked to approach the said Commission.

 

8. The contention of the learned senior counsel for the opposite party was that the service tax and VAT cannot be added to the sale price in order to determine the value of the service in terms of Section 21 of the Consumer Protection Act. 　I however, find no merit in this contention since, as per the agreement between the parties, the flat buyers were required to pay the aforesaid taxes to the opposite party, and not pay them directly to the concerned Government.　 It would be immaterial that the opposite party, in turn would have to deposit the said taxes with the concerned Government, the material fact being that without payment of the agreed purchase price and these taxes, the opposite party would be under no obligation to deliver possession of the flat to the buyers.　 Therefore, the aforesaid taxes, in my opinion, cannot be excluded while determining the value of the service, in terms of Section 21 of the consumer Protection Act."

 

5. If considered in terms of the decision in Dushyant Kumar Gupta (supra), this Commission does possess the requisite pecuniary jurisdiction to entertain the complaints since the agreed sale consideration and the compensation in the form of interest comes to more than Rupees one crore in all these matters.　

6. It was contended by the learned senior counsel for the opposite party that compensation for the purpose of pecuniary jurisdiction would mean only the contractual compensation agreed between the parties.　However, I find no merit in the contention. A bare perusal of Section 21(a) of the Consumer Protection Act would show that for the purpose of pecuniary jurisdiction, compensation, if any, claimed by the complainant is to be added to the value of the goods or services, as the case may be.　Of course, a highly exaggerated, fanciful or inflated claim cannot be considered to be a genuine claim and therefore, cannot be determinative of the pecuniary jurisdiction.　However, considering that not only this Commission, but the Hon’ble Supreme Court has awarded compensation in the form of interest at the rate upto 18% per annum, compensation in the form of interest calculated @ 18% per annum would not be taken as a highly inflated or exaggerated claim so as to warrant outright rejection of the complaint, even though the Court/Forum may award a lesser compensation.　 Therefore, I find no merit in the contention that this Commission lacks pecuniary jurisdiction to entertain these complaints.

 

7. On merits, the following contentions were advanced by Shri A.S. Chadhiok, learned senior counsel for the opposite party:-

 

(a) In view of the Clause 13(a) read with Clause 15 of the BBA, compensation @ Rs.10/- per sq. ft. per month is in the nature of a stipulation by way of penalty and therefore, the upper limit of the compensation which can be awarded to the complainants, in the event of breach of contract by the opposite party.

 

(b) No evidence of actual damages, if any, caused to the complainants has been led and therefore, they are not entitled to any compensation or damages.

 

(c) No loss or injury to the complainants has been established, and therefore, they are not entitled to any compensation

 

(d) No negligence on the part of the opposite party is proved or even alleged.

 

(e) The complainants are seeking specific performance of the contract between the parties, and therefore are bound by its terms.

 

8. Clause 13(a) and 15 of the BBA read as under:-

9.

"13. POSSESSION –

 

(a) Time of handing over the possession

 

Subject to terms of this clause and subject to the allottee(s) having complied with all the terms and conditions of the agreement, and not being in default under any of the provisions of this Agreement and compliance with all provisions, formalities, documentation etc., as prescribed by the company, the company proposes to hand over the possession of the Independent Floor within 27 months from the date of execution of this Agreement.　The allottee (s) agres and understands that the company shall be entitled to a grace period of three months for applying and obtaining the occupation certificate in respect of the Independent Floor and / or the project

 

15. COMPENSATION –

 

(a) In case within a grace period of six months as stated in clause 13(a), the company is not able to hand over the possession to the Allottee(s), the Allottee(s) shall be entitled to payment of compensation for delay at the rate of Rs.10/-(Rupees ten only) per sq. ft. per month of the super Area till the date of notice of possession under the provisions of Clause 14(a), provided the allottee(s) has complied with all the terms and conditions of this Agreement.　 The Allottee(s) shall have no other claim against the company in respect of the said independent floor and parking space under this Agreement during such extended period.

 

(b) The Allottee(s) agrees that the compensation as payable under clause 15 (a) hereinabove shall be payable only after making payment of all charges and clearing off all dues as reserved in this Agreement and after allottee(s) fulfils all the condition as set out in clause 14(b).

 

(c) The allottee(s) agrees and understands that the compensation as mentioned hereinabove, that may become payable to the allottee(s) will be paid only if the allottee(s) has not defaulted and or breached the terms of the Buyer’s Agreement or defaulted in payments as per the Schedule of Payment annexed hereto this Agreement or in other words has complied with all the terms and conditions of the Agreement.

 

(d) Notwithstanding anything contained hereinabove or elsewhere in this Agreement, in the event if there is delay in handing over possession due to the delay or non-receipt of the occupation certificate, completion certificate and / or any other permission / sanction from the competent authorities, then in such an event no such compensation or any other compensation shall be payable to the allottee(s)."

 

8. In terms of Section 14(1)(e) of the Consumer Protection Act, if this Commission is satisfied that any of the allegations contained in the complaint about the services of the opposite party are proved it is required to issue an order to the opposite party directing it to remove the deficiencies in the services in question.　 In terms of Section 14 (1)(d) of the Act this Commission is also required to pass an order directing the opposite party to pay compensation to the complainants for any loss or injury suffered by them due to the negligence of the opposite party.　 If the builder, whose services are engaged by a buyer for construction of a residential house for him fails to complete the construction and deliver its possession on or before the date committed by him for the purpose, such an act on the part of the builder would be an act of negligence, causing loss or injury to the flat buyer.　 The term ‘negligence’ has not been defined in the Consumer Protection Act but as per its dictionary meaning, it is the failure to give enough care or attention especially when such an act has serious results for another person (Oxford Advanced Learner’s Dictionary, New 8th Edition).　 As per Black’s Law Dictionary IX Edition, negligence includes the failure to exercise the standard of care that a reasonably prudent person would have exercised in a similar situation.　In the absence of force-majeure circumstances, a prudent builder in place of the opposite party would have been in a position to construct the flats and offer their possession to the complainants on or before the date committed for this purpose or at best within the grace period available under the BBA.　By not delivering on the commitment made by it with respect to the delivery of the possession of the flats booked by the complainants, the opposite party certainly committed an act of negligence and since the said act of negligence has resulted in loss or injury to the complainants who have been deprived of the user of the flats booked by them, compensation in terms of Seciton14 (1)(d) of the Consumer Protection Act can be awarded to the complainants, against the opposite party.

 

Since the Act empowers this Commission to direct removal of the deficiencies in the service in question, the opposite party, in exercise of the aforesaid power of this Commission, can also be directed and in fact ought to be directed to complete the construction and deliver possession of the flats to the complainants at the earliest possible. Therefore, both the directions sought by the complainants viz. direction for completion of the construction and delivery of possession of the flats and the direction for payment of compensation for the period the possession is delayed are within the competence of this Commission under Section 14 of the Consumer Protection Act.　 Therefore, it is not correct to say that the complainants are seeking specific performance of the agreement they had executed with the opposite party. The specific performance of a contract can be sought before a Civil Court in terms of the provisions contained in the Specific Relief Act 1963. Neither this Commission is a Civil Court nor have the complainants invoked the provisions of the Specific Relief Act, 1963.

 

9. Also, I find no merit in the contention that the compensation stipulated in Clause 15(a) of the BBA is in the nature of a penalty attracting applicability of Section 74 of the India Contract Act.　 The aforesaid compensation is a unilateral and patently unfair term imposed by the builders upon the flat buyers.　 Having already paid the booking amount to the builder, they have no option but to sign on the dotted lines, since the failure to execute the agreement unilaterally drafted by the builder and imposed upon the flat builders is likely to result in the booking amount being forfeited by the builder.　 Therefore, executing an agreement containing such a term is nothing, but a consent given under coercion and cannot be said to be the result of the exercise of a free consent on the part of the flat buyer. Moreover, a term to pay such a paltry compensation to the flat buyer in the event of default on the part of the builder, while making him pay exorbitant interest in the event of default or delay on his part is an absolutely unfair term. In fact, the incorporation of a term for　 payment of a paltry compensation to the buyer in the event of the failure of the builder to deliver possession within the time period committed by him, had become so wide spread and rampant that the Legislature had to step in by enactment of the Real Estate (Regulation & Development) Act, 2016 to statutorily require the builder to pay compensation in the form of interest at prescribed rate in the event of the possession being delayed or the buyer deciding to quit on account of the delay on the part of the builder in delivering upon the promise made by him. Therefore, irrespective of Clause 15(a) of the BBA, the complainants in my view are entitled to a just and fair compensation for the period the possession of the flats is delayed by the opposite party.

 

10. I am also unable to accept the contention that the complainants have failed to prove any loss or injury to them on account of the failure of the opposite party to deliver the possession of the flats on or before the time period stipulated in the BBA.　 Had the opposite party delivered possession of the flats within the time stipulated for this purpose, the complainants would have been enjoying the use and possession of the flats booked by them. They have been deprived of the user of the flats on account of the default committed by the opposite party. It can hardly be disputed that the deprivation of the user of a self- owned house amounts to a serious injury to the flat buyer who has booked the flat for the purpose of having a shelter over his head and therefore, has either to live in a rented accommodation or an accommodation which is not suitable or convenient to him. Also, we need to appreciate the satisfaction and enjoyment one would have if he lives in a house of choice owned by him as against living in a rented accommodation or in an accommodation which is not owned by him or is not otherwise suitable or convenient to him.

 

11. If a paltry compensation of say Rs.10/- per sq. ft. per month is awarded against a builder, it may lead to dangerous consequences since the builder may be tempted not to complete the construction and divert the money collected from the flat buyers for other purposes, in the hope that in the event of the buyer approaching a Court or a Consumer Forum, he can get away by paying a paltry compensation of Rs.10/- per sq. ft. per month to him. Paying such a meagre compensation would always be a win win situation for a builder who is likely to pay many times more if he goes to market for arranging finances which he gets by diverting the money collected from the flat buyers to other purposes.　 This Commission, therefore, ought to refrain from taking a view which would lead to such serious consequences, against the innocent flat buyers.　I also find some merit in the contention of the complainants that in a situation where the builder despite taking money from the flat buyers does not utilize the whole of the said money only for the construction of the flat sold to him, the amount which the builder has collected from the flat buyers should be treated as a cash deposit with the builder who should pay adequate interest to the flat buyer for utilizing his money.

 

12. For the reasons stated hereinabove, I hold that:

 

(i) The opposite party has been negligent in the matter of rendering services to the complainants;

 

(ii) The flat buyers have suffered loss and injury due to negligence of the opposite party

 

(iii) The term for payment of compensation under Clause 15(a) of the BBA does not bind the complainants, who are entitled to just and fair compensation against the opposite party for the deficiency on the part of the opposite party in the services rendered to them.

 

(iv) The complainants are not seeking specific performance of the BBA in terms of the Specific Relief Act, 1963 but are seeking compensation in terms of Section 14(1)(d) of the Consumer Protection Act and

 

(v) This Commission in exercise of the powers conferred upon it by Section 14(1)(e) of the Consumer Protection Act can direct the opposite party remove the deficiencies in the services by completing the construction and delivering possession of the flats within a reasonable time."

 

08. Such type of Clauses present in the Builder Buyer Agreements had also been recently examined by the Hon’ble Supreme Court in Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan, II (2009) CPJ 34 (SC), and it was held as under:-

“6.7. A terms of a contract will not be final and binding if it is shown that the flat purchasers had no option but to sign on the dotted line, on a contract framed by the builder. The contractual terms of the Agreement dated 08.05.2012 are ex-facie one sided, unfair and unreasonable. The incorporation of such one-sided clauses in an agreement constitutes an unfair trade practice as per Section 2(r) of the Consumer Protection Act, 1986 since it adopts unfair methods or practices for the purpose of selling the flats by the Builder.

7. In view of the above discussion, we have no hesitation in holding that the terms of the Apartment Buyer’s Agreement dated 08.05.2012 were wholly one-sided and unfair to the Respondent-Flat Purchaser. The Appellant-Builder cannot seek to bind the Respondent with such one-sided contractual terms.”

09. Now, adverting to the stand taken by the Opposite Party that the Complainant is not a “Consumer” and is only an “investor”, in our considered view, it does not hold water in the light of the judgment of this Commission in Kavita Ahuja vs. Shipra Estates I - (2016) CPJ 31, in which the principle laid down is that the onus of establishing that the Complainant was dealing in real estate i.e. in the purchase and sale of plots/flats in his normal course of business to earn profits, shifts to the Opposite Party, which in the instant case they had failed to discharge by filing any documentary evidence to establish their case. Therefore, we decide this issue in favour of the Complainant.

10. With regard to the defence taken by the Opposite Party that the Complainants being re-allottees of the Apartment in the Project, have no locus standi to file the present complaint, a reference can be made to the decision of the Hon’ble Supreme Court in “Laureate Buildwell Pvt. Ltd. vs. Charanjeet Singh”- 2021 SCC OnLine SC 479, in which it has been held that subsequent purchaser who takes over the obligation of the Original purchaser to pay the balance amount, would not per se exclude them from the description of a Consumer, by observing as under:-

“23. The Builder does not deny that upon issuance of the endorsement letter, the purchaser not only stepped into the shoes of the original allottee but also became entitled to receive possession of the flat. There is no denial that the purchaser fulfils the description of the complainant/consumer and is entitled to move any forum under the Consumer Protection Act for any deficiency in service. The question then is whether a subsequent purchaser is not entitled to similar treatment as the original allottee, and can be denied relief which otherwise the original allottee would have been entitled to, had she or he continued with the arrangement. An individual such as the original allottee, enters into an agreement to purchase the flat in an on-going project where delivery is promised. The terms of the agreement as well as the assurance by the builder are that the flat would be made available within a time-frame. It is commonplace that in a large number of such transactions, allottees are not able to finance the flat but seek advances and funds from banks or financial institutions, to which they mortgage the property. The mortgage pay-outs start initially after an agreed period, commencing in a span of about 15 to 24 months after the agreement. This would mean that in most cases, allottees start repaying the bank or financial institutions with instalments (mostly equated monthly instalments) towards the principal and the interest spread over a period of time, even before the flats are ready. If these facts are taken into consideration, prolongation of the project would involve serious economic repercussions upon such original allottees who are on the one hand compelled to pay instalments and, in addition, quite often-if she or he is in want of a house-also pay monthly rents. Such burdens become almost intolerable. It is at this point that an indefinite wait is impossible and allottees prefer to find purchasers who might step into their shoes. That such purchasers take over the obligations of the original allottee - either to pay the balance instalments or to wait for sometime, would not per se exclude them from the description of a consumer. All that then happens is that the consumer forum or commission - or even courts have to examine the relative equities having regard to the time frame in each case.”

 

11. Another plea taken by the Opposite Party for the delay in completion of the Project is that the Complainants had defaulted in making the due instalments. However, we do not find any merit in the said contention.  If there was any delay in making the payment by the Complainants, the Opposite Party was at liberty to either charged the interest on the delayed payment or to terminate the booking of the Apartment which option has not been exercised by the Opposite Party and as such the said contention is rejected. 

12. With regard to the preliminary objection taken by the Opposite Party that due to existence of Arbitration Clause in the Agreement, this Commission has no jurisdiction to entertain the Complaint, the Hon'ble Supreme Court in M/S Emaar MGF Land Limited vs Aftab Singh - I (2019) CPJ 5 (SC), has laid down the law that the Arbitration Clause in the Agreement does not bar the jurisdiction of the Consumer Fora to entertain the Complaint. 

13. The brief facts of the case are that the Complainants had purchased the Apartment No.PH3-37-0401 from its Original Allottee in the Project, namely, Palm Hills” on 08.08.2012. The said Apartment was transferred in the name of the Complainants by the Opposite Party by charging the necessary Transfer Fee and further the amount received from the Original Allottee by the Opposite Party was transferred in the account of the Complainants and as such, the Complainants have entered into the shoe of the Original Allottee. The Builder Buyer Agreement was executed between the parties on 31.12.2010. As per Clause 11 (a) of the Agreement, the Project was to be completed and possession of the Apartment was to be handed over, complete in all respect by the Opposite Party to the Complainants within a period of 33 months from the date of start of construction. It has been admitted by the Opposite Party in its written version that the construction at the site had started on 25.05.2011 and as such,  the Opposite Party was under an obligation to hand over the possession of the Apartment to the Complaint on or before 25.02.2014.   It has been further admitted in the Written Version by the Opposite Party that offer of possession was made to the Complainants 09.10.2017 upon grant of Occupation Certificate dated 03.10.2017. As such, even as per admission of the Opposite Party itself, there was delay of more than three years in offering possession of the Apartment to the Complainants.  However, according to the Complainants as per construction update on the website of the Opposite Party, the Project is still incomplete and Apartment is not ready, in all respect to be delivered to the Complainants 

14. In the case of Emmar MGF Land Ltd. & Ors.  vs. Amit Puri - [II (2015) CPJ 568 (NC)], this Commission has held that after the promised date of delivery, it is the discretion of the Complainant whether to accept the offer of possession, if any, or to seek refund of the amounts paid by him with some reasonable compensation and it is well within his right to seek for refund of the principal amount with interest and compensation. 

15. Further, in the case of Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra - II (2019) CPJ 29 SC, the Hon’ble Apex Court has observed as under :-

“.....It would be manifestly unreasonable to construe the contract between the parties as requiring the buyer to wait indefinitely for possession. By 2016, nearly seven years had elapsed from the date of the agreement. Even according to the developer, the completion certificate was received on 29 March 2016. This was nearly seven years after the extended date for the handing over of possession prescribed by the agreement. A buyer can be expected to wait for possession for a reasonable period. A period of seven years in beyond what is reasonable. Hence, it would have been manifestly unfair to non-suit the buyer merely on the basis of the first prayer in the reliefs sought before the SCDRC. There was in any event a prayer for refund.

 

In the circumstances, we are of the view that the orders passed by the SCDRC and by the NCDRC for refund of moneys were justified.”

 

16. In the instant cases also, the Complainants cannot be made to wait indefinitely for possession of their Apartments and the Complainants are entitled for refund of the principal amount with interest in both the Consumer Complaints. Accordingly, keeping in view the ratio laid down by the Hon’ble Supreme Court in DLF Homes Panchkula Pvt. Ltd Vs. D.S. Dhanda - II (2019) CPJ 117 (SC), that compensation under multiple heads cannot be awarded, we are of the considered view that simple interest in the form of compensation @ 9% p.a. would meet the ends of justice together with costs of ₹50,000/-. In both the cases, the Complainants are not the Original Allottes and they are the subsequent buyers. With regard to compensation payable to a subsequent buyer, the Hon’ble Supreme Court in the case of D.S. Dhanda’s case (Supra),  has held as under:-

“ In case, the original allottee has transferred the flat, the transferee shall be entitled to interest at the rate of 9 per cent per annum from the date of expiry of three years from the agreement or from the date of transfer, whichever is later.” 

 

17. In view of the aforesaid discussion, both the Consumer Complaints are partly allowed and the Opposite Party is directed to refund the deposited amount to the Complainants with compensation in the form of simple interest @ 9% p.a. from the date of expiry of three years from the Agreement or from the date of transfer, whichever is later, within a period of six weeks from the date of receipt of a copy of this order failing which the amount shall carry interest @ 12% p.a. for the said period.  The Opposite Party shall also be liable to pay ₹50,000/- to the Complainants in both the Consumer Complaints towards litigation charges.