Chandigarh

StateCommission

CC/768/2016

Harish Bhardwaj - Complainant(s)

Versus

Omaxe Chandigarh Extension Developers Pvt. Ltd - Opp.Party(s)

Rajesh Verma, Adv.

20 Mar 2017

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Complaint case No.	:	768 of 2016
Date of Institution	:	07.11.2016
Date of Decision	:	20.03.2017

 

1. Harish Bhardwaj son of Sh.A.K Bhardwaj.
2. Sunita Bhardwaj wife of Sh.Harish Bhardwaj.

Both residents of House No.3132, Sector 20-D, Chandigarh.

……Complainants

V e r s u s

1. Omaxe Chandigarh Extension Developers Private Limited (Wholly owned subsidiary of M/s Omaxe Ltd.) 10 Local Shopping Complex, Kalkaji, New Delhi-110019, through its Managing Director/Principal Officer/Authorized Signatory.
2. Managing Director, Omaxe Chandigarh Extension Developers Private Limited (Wholly owned subsidiary of M/s Omaxe Ltd.) 10 Local Shopping Complex, Kalkaji, New Delhi-110019.
3. Omaxe Chandigarh Extension Developers Pvt. Ltd., (Wholly owned subsidiary of M/s Omaxe Ltd.), SCO No.139-140, First Floor, Sector 8-C, Chandigarh-160008, through its Authorized Person/Principal Officer.

              .... Opposite Parties No.1 to 3.

 

4. Housing Development Finance Corporation Limited, SCO No.153-154-155, Sector 8C, Madhya Marg, Chandigarh, through is Manager.

….Proforma Opposite Party

 

Argued by:       Sh.Rajesh Verma, Advocate for the   complainants.

      Sh.Munish Gupta, Advocate for opposite parties      no.1 to 3.

                        Ms.Rupali Shekhar Verma, Advocate for opposite                     party no.4.

=====================================================

 

 

 

Complaint case No.	:	827 of 2016
Date of Institution	:	18.11.2016
Date of Decision	:	20.03.2017

 

Lakhmir Singh Sandhu son of Sh.Jagir Singh Sandhu, resident of House No.2270-A, Sector 47-C, Chandigarh

……Complainant

V e r s u s

M/s Omaxe Chandigarh Extension Developers Pvt. Ltd., a Company registered under the provisions of the Companies Act, 1956, having its Regional Office at SCO No.139-140, First Floor, Sector 8-C, Madhya Marg, Chandigarh-160008 and Corporate Office at 10 L.S.C., Kalkaji, New Delhi, through its Managing Director.

….Opposite party

 

Argued by:       Sh.Amit Sharma, Advocate for the complainant.

      Sh.Munish Gupta, Advocate for the opposite    party

 

Complaints under Section 17 of the Consumer Protection Act, 1986.

 

BEFORE:         JUSTICE JASBIR SINGH (RETD.), PRESIDENT.

                        MR. DEV RAJ, MEMBER.

                        MRS. PADMA PANDEY, MEMBER

 

PER JUSTICE JASBIR SINGH (RETD.), PRESIDENT

                By this order, we propose to dispose of the aforesaid two consumer complaints. 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. In both the complaints, the complainants have leveled allegations against the opposite parties, regarding deficiency in providing service and adopting unfair trade practice, on their part, in not completing the development work and handing over possession of the plot(s) purchased by them, respectively, despite receiving substantial amount. However, on account of said deficiency in providing service, the complainants in consumer complaint bearing no.768 of 2016 have sought refund of the amount deposited alongwith interest, compensation, litigation etc. Whereas, in consumer complaint bearing no.827 of 2016, the complainant has sought possession of the plot, allotted in his favour, alongwith compensation, by way of interest for the period of delay; compensation for mental agony and physical harassment, cost of litigation etc. Since, the grievance of the complainants in both the complaints, is in relation to the same project, and only the relief claimed, as referred to above, was different, as such, at the time of arguments, on 10.03.2017, it was agreed between the contesting parties, that, in view of above, both the complaints can be disposed of, by passing a consolidated order, while considering the prayer made, respectively.

2.         Under above circumstances, to dictate order, facts are being taken from consumer complaint bearing no.768 of 2016, titled as Harish Bhardwaj and another Vs. Omaxe Chandigarh Extension Developers Private Limited and others. The complainants are husband and wife respectively. They opted to purchase a residential plot in a project launched by opposite parties no.1 to 3, under the name and style of Omaxe Chandigarh Extension, Phase-II, Mullanpur, SAS Nagar, Mohali, Punjab. They paid an amount of Rs.13.50 lacs, on 11.12.2010, as booking amount. Price of the said plot was fixed at Rs.54.80 lacs. Copy of booking application has been placed on record as Annexure C-3. Vide letter dated 25.05.2011, Annexure C-5, opposite parties no.1 to 3 demanded further amount of Rs.7,77,600/-, which was paid by the complainants, within time. They were allotted plot bearing no.877, measuring 321 square yards, in the said project, vide provisional allotment letter dated 12.12.2011 Annexure C-6. Allotment letter/Agreement Annexure C-7 was issued in favour of the complainants on 31.05.2012. Vide document Annexure-B (Part-III), they were offered installment payment plan. It is case of the complainants that as per Clause 24 (a) of the said Allotment Letter/Agreement, opposite parties no.1 to 3 committed to handover possession of the developed plot, within a period of 18 months or within extended period of six months, from the date of signing of the said Allotment Letter/Agreement. In this manner, possession of the plot was to be delivered on or before 30.05.2014. The complainants made payment of Rs.56,36,900/- in the following manner:-

 

S.no.	Cheque/Bank	Dated	Amount	Receipt ID	Receipt date
	015071 ICICI	11.12.2010	675000.00	464119	14.12.2010
	354823 PNB	11.12.2010	675000.00	464119	14.12.2010
	084249 ICICI	30.06.2011	300000.00	518101	30.06.2011
	850371 PNB	30.06.2011	477600.00	518102	30.06.2011
	030685 ICICI	08.02.2012	100000.00	681001	09.02.2012
	107391 ICICI	08.02.2012	260000.00	680999	09.02.2012
	107392 ICICI	08.02.2016	140000.00
	636853 PNB	08.02.2012	400000.00	681002	09.02.2012
	895541 HDFC	12.09.2012	613000.00	761159	13.09.2012
	914346 HDFC	09.04.2013	950000.00		10.04.2013
	182513 ICICI	09.07.2013	125000.00	949925	05.08.2013
	921739 HDFC	04.07.2013	152000.00	949928	05.08.2013
	519961 SBOP	02.08.2013	200000.00	951203	09.08.2013
	171523 ICICI	16.08.2013	123000.00	955628	23.08.2013
	643301 SBOP	01.02.2014	140000.00	1035856	07.02.2014
	219291 ICICI	01.02.2014	60000.00	1035855	07.02.2014
	004566 PNB	17.04.2014	100000.00	1054036	25.04.2014
	171527 ICICI	07.07.2014	100000.00		09.08.2014
	219295 ICICI	02.09.2014	46300.00	1105834	04.09.2014
	TOTAL		5636900.00

 

 

3.         Further, demand was raised for an amount of Rs.62,950.34ps., on 01.06.2016 vide letter Annexure C-11. The complainants asked opposite parties no.1 to 3, for statement of accounts, wherein payment of Rs.56,36,900/- was admitted. Very strangely, amount of Rs.3,19,603/- was claimed towards interest without assigning any reason. To make payment, the complainants have raised loan from opposite party no.4. Allotment of plot no.877 was shifted to plot no.147D, measuring 305.99 square yards, vide letter dated 26.07.2014, without getting consent from the complainants. Location of the shifted plot was not good. As per stipulation in the agreement, last installment of small amount was to be paid, at the time of handing over possession, however, very arbitrarily, it was demanded by opposite parties no.1 to 3, prior thereto. It is further the case of the complainants that the area where the plot, in question, was located, is not developed nor possession of the same is expected in near future. By stating as above, the instant complaint was filed seeking refund of amount paid alongwith interest thereupon; compensation for mental agony & physical harassment, litigation expenses etc. The complainants have sought interest to the tune of Rs.34,34,138/- till 31.10.2016 and thereafter also. Whereas, as stated above, in connected complaint bearing no.827 of 2016, the complainant has sought directions of possession of the plot, alongwith other relief, referred to above.
4.         Notice in this complaint was issued to the opposite parties on 09.11.2016.
5.         Opposite parties no.1 to 3, filed their joint written version, raising many preliminary objections like as per Clause 44 (c) of the Allotment Letter/Agreement, this Commission has no jurisdiction, to entertain and decide disputes between the parties, because as per above said provision, the matter needs to be referred to an arbitrator for adjudication. It was averred in the joint written reply that the complainants being investors, did not fall within the definition of “consumer” as defined under Section 2(1)(d) of the Act, as such, they purchased the plot, in question, for commercial purpose i.e. for selling the same, as and when there was escalation in the prices of real estate, to gain huge profits. Pecuniary jurisdiction of this Commission was challenged stating that if interest claimed is added in other reliefs claimed, it fell beyond Rs.1 crore. Territorial jurisdiction of this Commission was also challenged, by stating that no cause of action, whatsoever, has accrued within the territorial jurisdiction of this Commission. As per Clause 44 (c) of the Allotment Letter/Agreement, the Courts at Punjab and Delhi, shall have territorial Jurisdiction, to entertain and adjudicate the complaint, and, as such, the Jurisdiction of this Commission was barred.
6.         Factual matrix of the case was not controverted. Price of the plot mentioned in the complaint and payments made by the complainants are not disputed. It is admitted that the complainants booked the plot in question and they were provisionally allotted the same. It was also not denied that as per Clause 24 (a) of the Allotment Letter/Agreement, it was agreed that opposite parties no.1 to 3 shall complete development works within a maximum period of 18 months from the date of signing thereof (allotment letter), with extended period of six months. It was further stated that since the complainants defaulted in making payment of installments, as such, they cannot claim any relief out of the terms and conditions of the Agreement. It was averred that the payments were demanded, as per payment schedule. It was admitted that the complainants were relocated to another plot, referred to above. However, the same was done to expedite possession thereof to the complainants. It was further stated that on account of relocation to plot no.147D, vide letter dated 26.07.2014, the complaint having been filed in November 2016, is premature. The complainants have concealed facts from this Commission, as such, the complaint is liable to be dismissed on this ground alone. It was further stated that since the complainants are seeking refund of the amount deposited, as such, only the remedy available to them is the Civil Court i.e. civil suit for recovery. Prayer was made to dismiss the complaint. At the time of arguments, Counsel for opposite parties no.1 to 3 stated that possession of developed plot is likely to be given in near future. However, no specific date was given.
7.         On 30.01.2017, an application under Section 8 of the Arbitration and Conciliation Act, 1996, was also filed by opposite parties no.1 to 3 stating that this Commission has no jurisdiction to entertain the consumer complaint and let the matter be referred to an arbitration for adjudication. The said application was disposed of vide order dated 01.02.2017, with the direction that question qua arbitration will be considered, at the time of final arguments in the main case.     
8.         Opposite party no.4, in its written version pleaded that since the complainants are aggrieved of non delivery of possession of the plot purchased by them from opposite parties no.1 to 3 and also no allegations have been leveled against it, the complaint deserved to be dismissed against opposite party no.4. However, in case, this Commission comes to the conclusion that the complainants are entitled to refund of the amount deposited, opposite party no.4 shall have the first charge on the amount, to the extent due, to be paid by them (complainants).
9.         In the rejoinder filed, the complainants reiterated all the averments, contained in the complaint and controverted those, contained in written version of the opposite parties no.1 to 3.
10.         The contesting parties led evidence in support of their cases.
11.         Counsel for the contesting parties raised arguments, in tune of the facts narrated above.
12.         We have heard Counsel for the parties and have gone through the evidence and record of the cases, very carefully.
13.         Before making any reference to the merits of the case, we will like to decide the objection raised by opposite parties no.1 to 3 that for want of pecuniary jurisdiction, it is not open to this Commission to entertain and adjudicate this complaint.  As per admitted facts, the complainants have sought refund of amount paid i.e. Rs.56,36,900/- alongwith interest @15% p.a. from the respective date of deposits till 31.10.2016 i.e. Rs.34,34,138/- with future interest; compensation to the tune of Rs.5 lacs, for mental agony and physical harassment; and cost of litigation to the tune of Rs.50,000/-. It is argued by Counsel for the opposite party that if the 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. It may be stated here that if the aggregate value of the relief claimed, referred to above, is added, in no way it is exceeding Rs.1 crore. It appears that the said objection has been taken by opposite parties no.1 to 3, without calculating the amount claimed by the complainants in the relief clause, till the date of filing this complaint. In view of above, objection raised by opposite parties no.1 to 3, being devoid of merit, stands rejected.
14.         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 Allotment Letter/Agreement, containing detailed terms and conditions, that the same is executed between the parties at Chandigarh, as the same bears the stamp of Chandigarh Office of opposite parties no.1 to 3. Besides as above, various other documents placed on record like letter dated 26.07.2014 Annexure C-19 and 26.08.2013 Annexure C-21, were also issued by opposite parties no.1 to 3 at Chandigarh, as the same bore the round seal/stamp of 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 opposite parties no.1 to 3 in their written version, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected. 

15.         No doubt, in the written version, an objection was also taken by opposite parties no.1 to 3 that as per Clause 44 (c) of the Allotment Letter/Agreement, the Courts at Delhi and Punjab, shall have Jurisdiction, to entertain and adjudicate the complaint, 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 complainants, 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 complainants 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 them, to file the complaint. The submission of Counsel for opposite parties no.1 to 3, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected.

16.          The next question, that falls for consideration, is, as to whether, the complainants fell within the definition of a consumer, as defined by Section 2 (1) (d) (ii) of the Act, or not. It may be stated here that the mere objection of opposite parties no.1 to 3 that the complainants are investors, as such they had purchased the plot, by way of investment, to gain huge profits, by selling the same, as and when there was escalation in prices, does not carry any weight and is liable to be rejected. It has been mentioned by the complainants, in para no.22 of their complaint that they were to construct house on the said plot and reside therein. On the other hand, nothing contrary to this has been proved by opposite parties no.1 to 3, by placing on record, any document.
17.         Similar objection was also raised by Counsel for the opposite party, in connected  case bearing no.827 of 2016,  saying that the complainant will not fall within the definition, as he has purchased other units, in the project of the opposite party(s). It may be stated here that, in the said complaint, it is specifically mentioned by the complainant that the plot was purchased by him, for his personal use, so that he is able to get free of rented accommodation. Furthermore, as per reply filed, one property was purchased by one Renu Sandhu wife of the complainant. She is an independent person and property purchased by her, will not effect, so far as rights of the complainant are concerned. The other two units purchased by the complainants are the booths. Those have been purchased for the purpose of earning their livelihood.
18.                 Even otherwise, the mere fact that the plots purchased by the complainants, in both the complaints, was a residential property, 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, and deal in the sale and purchase of property. Furthermore, 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 as above, recently under similar circumstances, in a case titled as Aashish Oberai Vs. Emaar MGF Land Limited, Consumer Case No. 70 of 2015, decided on 14 Sep 2016, the National Commission, while rejecting similar plea raised by the builder, observed 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.  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.”

 

Thus, in the absence of any cogent evidence, in support of the objection raised by the opposite parties/builder, mere bald assertion to that effect, cannot be taken into consideration. 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 opposite parties/builder, therefore, being devoid of merit, is rejected.  

19.         The next question, that falls for consideration, is, as to whether, the complainants in consumer complaint bearing no.768 of 2016 are entitled to refund of the amount of Rs.56,36,900/-deposited by them. It is an admitted fact that  for purchase of the plot bearing no.877, in the said project, the complainants paid an amount of Rs.13.50 lacs on 11.12.2010, as booking amount. Price of the said plot was fixed at Rs.54.80 lacs. Allotment of the said plot, measuring 321 square yards, was made vide provisional allotment letter dated 12.12.2011 Annexure C-6. Allotment letter/Agreement Annexure C-7 was issued in favour of the complainants on 31.05.2012. As per Clause 24 (a) of the said Allotment Letter/Agreement, opposite parties no.1 to 3 committed to handover possession of the plot, in question, within 18 months or within extended period of six months, from the date of signing of the said Allotment Letter/Agreement i.e. on or before 30.05.2014. The complainants made payment of Rs.56,36,900/- against Rs.54.80 lacs. However, instead of offering possession of plot no.877, they were relocated to plot no.147D, measuring 305.99 square yards, vide letter dated 26.07.2014, without their consent, location of which was not suitable to them. Possession of even relocated plot was not offered to the complainants, for want of development and basic amenities. It is positive case of the complainants that the area where the plot, in question, was located, is not developed nor possession of the same is expected in near future. Promised date to deliver possession of the plot was 30.05.2014 and now it is March 2017. Even at the time of arguments, no commitment was made by opposite parties no.1 to 3, as to on which date, possession of the developed plot, can be delivered to the complainants. It was only said that the opposite parties no.1 to 3 are making best efforts, to complete the development work.  Since, the complainants have sought refund of the amount deposited alongwith interest and compensation, as such, on account of their said prayer, they cannot be made to wait for an indefinite period, for delivery of possession of the plot purchased by them. Non-delivery of possession of the plot, in question, by the stipulated date, is a material violation of the terms and conditions of the Allotment Letter/Agreement, on the part of opposite parties no.1 to 3. 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:-

“I am in agreement with the learned senior counsel for the complainants that considering the default on the part of opposite parties no.1 and 2 in performing its contractual obligation, the complainants cannot be compelled to accept the offer of possession at this belated stage and therefore, is entitled to refund the entire amount paid by him along with reasonable compensation, in the form of interest.”

20.         Not only as above, in a case titled as Brig Ajay Raina (Retd.) and another Vs. M/s Unitech Limited, Consumer Complaint No.59 of 2016, decided on 24.05.2016, wherein possession was offered after a long delay, this Commission, while relying upon the judgments rendered by the Hon`ble National Commission, ordered refund to the complainants, while holding as under:-

“Further, even if, it is assumed for the sake of arguments, that offer of possession, was made to the complainants, in July 2015 i.e. after a delay of about three years, from the stipulated date, even then, it is not obligatory upon the complainants to accept the same. It was so held by the National Commission in Emaar   MGF   Land   Limited   and   another   Vs. Dilshad Gill, III (2015) CPJ 329 (NC). Recently also, under similar circumstances, in the case of M/s. Emaar MGF Land Ltd. & Anr. Vs. Dr.Manuj Chhabra, First Appeal No.1028 of 2015, decided on 19.04.2016, the National Commission, held as under:-

“I am of the prima facie view that even if the said offer was genuine, yet, the complainants was not obliged to accept such an offer, made after a lapse of more than two years of committed date of delivery”.

                However, in the present case, the situation is worst, as possession of even relocated plot has not been even offered to the complainants, what to speak of delay in offer thereof. In view of above, it is held that since there was a material violation on the part of opposite parties no.1 to 3 in not offering and handing over possession of the developed plot by the stipulated date or even till date, the complainants were at liberty to seek refund of the amount deposited, alongwith interest and compensation, by way of filing the instant complaint.

                In view of above facts of the case, opposite parties no.1 to 3 are also under an obligation to compensate the complainants, for inflicting mental agony and causing physical harassment to them, as also escalation in prices.

21.         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.56,36,900/-, was paid by the complainants, without getting anything, in lieu thereof. The said amount has been used by opposite parties no.1 to 3 for their own benefit. There is no dispute that for making delayed payments, opposite parties no.1 to 3 were charging heavy rate of interest 18% p.a. for the first month and thereafter @24% p.a.,  as per Clause 14 of the Allotment Letter/Agreement, for the period of delay in making payment of instalments.  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.56,36,900/- alongwith interest, from the respective dates of deposits till realization.  
22.          As far as the plea taken by opposite parties no.1 to 3 to the effect that there was delay in making payment on the part of the complainants, as such, they are not entitled to any relief,  it may be stated here that, to say so, reliance has been placed by them only on the letter dated 04.09.2012 Annexure R-1, which was sent by the complainants themselves. It may be stated here that perusal of contents of the said letter reveals that vide the said letter, it was intimated by the complainants to opposite parties no.1 to 3, that since their project was not cleared by the competent authorities, as such, opposite party no.4 was not disbursing the loan amount, sanctioned in their favour. However, opposite parties no.1 to 3 even failed to give reply to that letter, wherein a very serious issued was raised by the complainants. On the other hand, except the said letter, no other cogent and convincing evidence has been brought on record, in the shape of copy of any customer ledger or statement of account, pertaining to the account of the complainants, to prove that they were regular defaulters in making payment towards price of the said shop.  Huge amount of Rs.56,36,900/- was received by opposite parties no.1 to 3 from the complainants by September 2014 but possession of the plot originally allotted to them was not handed over. Thereafter, vide letter dated 26.07.2014, the complainants were relocated to the plot referred to above, meaning thereby that the plot allotted to the complainants in the year 2010 was not existing at the site. Under these circumstances, it is held that, delay in offer of possession of the unit, in question, was not on account of delay in making payments by the complainants but it was on account of non-obtaining of necessary permissions/ sanctions by the opposite parties, in respect of the project, in question, from the Competent Authorities and also the originally plot allotted was not in existence at the site. In the present case, opposite parties no.1 to 3 are trying to shift their deficiencies, on the shoulders of the complainants, by taking bald pleas, which is not sustainable in the eyes of law. Nothing was concealed by the complainants, as far as the present complaint is concerned. As such, it is held that opposite parties no.1 to 3 in not offering possession of the plot, in question, even as on today, despite receiving substantial amount from the complainants, and that too, in the absence of any force majeure circumstances, amounted to deficiency in providing service and also adoption of unfair trade practice.

                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 opposite parties no.1 to 3 out of the objection, raised by them, in this regard.

23.         An objection was also raised by opposite parties no.1 to 3 that the consumer complaint is not maintainable, and only a Civil Court can decide the case, as the complainants were required to file a recovery suit. It may be stated here, that the complainants hired the services of opposite parties no.1 to 3 for purchasing the plot, in the manner, referred to above, possession of which was to be delivered on or before 30.05.2014, as per Clause 24 (a) of the Agreement. However, by not doing so, opposite parties no.1 to 3 breached the terms and conditions of the Agreement, which is a deficiency in providing service  and also indulgence into unfair trade practice, on their part, for which, the complainants have rightly filed the consumer complaint, under the  Act. 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 1986 Act, provides an alternative remedy. Even if, it is assumed that the complainants have a remedy to file a suit, in the Civil Court, for recovery suit, the alternative remedy provided under Section 3 of the Act, can also be availed of by them, as they fall within the definition of consumer.

                The plea taken by opposite parties no.1 to 3 is also bereft of merit, in view of latest judgment passed by the National Commission, titled as M/s. Karwa Developers & 3 Ors. Vs. Shree Vinayak Co-Operative Housing Society Ltd. & 3 Ors., First Appeal No. 980 of 2016,  decided on 3^rd  March, 2017, wherein, a similar plea of the builder was negated by it, while holding as under:-

“We also do not find any substance in the plea taken by the appellant that under clause 14(a) of the development agreement, the complainant was required to file a civil suit under the Specific Relief Act only, because they were asking for monetary relief.  The State Commission rightly stated that the relief sought in the complaint were on account of deficiencies committed by the OP Developers, vis-à-vis, the society.  Since there is a specific clause in the agreement for giving the possession of the flat within specific time frame and penalty has been provided if the developers failed to develop the same, the society was well within its rights to file consumer complaint against the OP builder.”

               

                In this view of the matter, the objection raised by Counsel for opposite parties no.1 to 3 in this regard, being devoid of merit, must fail, and the same stands rejected.

24.         Counsel for opposite parties no.1 to 3 also argued 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 arbitration for adjudication. We are not going to agree with the argument raised. This question has already been elaborately dealt with by this Commission in case titled ‘Sarbjit Singh Vs. Puma Realtors Private Limited’, IV (2016) CPJ 126. Paras 25 to 35 of the said order, inter-alia, being relevant, are extracted hereunder:-

25.        The next 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.

26.      To decide above said question, it is necessary to reproduce the provisions of  Section 3 of the Consumer Protection Act 1986 (in short the Act), which reads as under;

 

“3. Act not in derogation of any other law.—

The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force.”

27.                It is also desirable to reproduce unamended provisions of Section 8 of 1996 Act, which reads thus:- 

“8. Power to refer parties to arbitration where there is an  arbitration agreement.—

(1) A judicial authority before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration.

(2) The application referred to in sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof.

(3) Notwithstanding that an application has been made under sub-section (1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made.”

28.      Many a times, by making reference to the provisions of Section 8 of 1996 Act, in the past also, such objections were raised and the Hon'ble Supreme Court of India, when interpreting the provisions of Section 3 of 1986 Act, in the cases of 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) etc., came to a conclusion that the remedy provided under Section 3 of 1986 Act, is an independent and additional remedy and existence of an arbitration clause in the agreement, to settle disputes, will not debar the Consumer Foras, to entertain the complaints, filed by the consumers.

29.       In the year 2015, many amendments were effected in the provisions of 1996 Act. After amendment, Section 8 of 1996 Act, reads as under:-

 “8. Power to refer parties to arbitration where there is an arbitration agreement.—

(1) A judicial authority, before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party to the arbitration agreement or any person claiming through or under him, so applies not later than the date of submitting his first statement on the substance of the dispute, then, notwithstanding any judgment, decree or order of the Supreme Court or any Court, refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists.”

30.   Now it is to be seen, whether, after amendment in Section 8 of the principal Act, any additional right has accrued to the service provider(s), to say that on account of existence of arbitration agreement, for settling the disputes through an Arbitrator, the Consumer Foras have no jurisdiction to entertain a consumer complaint. As has been held by Hon'ble Supreme Court of India, in various cases, and also of the National Commission, in large number of judgments, Section 3 of the 1986 Act, provides additional remedy, notwithstanding any other remedy available to a consumer. The said remedy is also not in derogation to any other Act/Law.

31.        Now, we will have to see what difference has been made by the amendment, in the provisions of Section 8 of 1996 Act. After amendment, it reads that a Judicial Authority is supposed to refer the matter to an Arbitrator, if there exists an arbitration clause in the agreement, notwithstanding any judgment, decree, order of the Hon'ble Supreme Court of India, or any other Court, unless it finds that prima facie, no valid arbitration agreement exists. The legislation was alive to the ratio of the judgments, as referred to above, in earlier part of this order. Vide those judgments, it is specifically mandated that under Section 3 of 1986 Act, an additional remedy is available to the consumer(s), which is not in derogation to any other Act. As and when any argument was raised, the Hon'ble Supreme Court of India and the National Commission in the judgments, referred to above, have made it very clear that in the face of Section 8 of 1996 Act and existence of arbitration agreement, it is still opened to the Consumer Foras to entertain the consumer complaints. None of the judgments ever conferred any jurisdiction upon the Consumer Foras to entertain such like complaints. Only the legal issues, as existed in the Statute Book, were explained vide different judgments. If we look into amended provisions of Section 8 of the principal Act, it explains  that judicial Authority needs to refer dispute, in which arbitration agreement exist to settle the disputes notwithstanding any judgment/decree or order of any Court. That may be true where in a case,  some order has been passed by any Court, making arbitration Agreement non-applicable to a dispute/parties. However, in the present case, the above said argument is not available. The jurisdiction of Consumer Foras to entertain consumer complaints, in the face of arbitration clause in the Agreement, is in-built in 1986 Act. It was not given to these Foras, by any judgment ever. The provisions of Section 3 of 1986 Act interpreted vide judgments vis a vis Section 8 of un-amended 1996 Act, were known to the legislature, when the amended Act 2015 was passed. If there was any intention on the part of the legislature, then it would have been very conveniently provided that notwithstanding any remedy available in 1986 Act, it would be binding upon the judicial Authority to refer the matter to an Arbitrator, in case of existence of arbitration agreement, however, it was not so said.

32.        We can deal with this issue, from another angle also. If this contention raised is accepted, it will go against the basic spirit of 1986 Act. The said Act (1986) was enacted to protect poor consumers against might of the service providers/multinational companies/traders. As in the present case, the complainant has spent his life savings to get a unit, for his residential purpose. His hopes were shattered. Litigation in the Consumer Fora is cost effective. It does not involve huge expenses and further it is very quick. A complaint in the State Commission can be filed, by making payment between Rs.2000/- to Rs.4000/- (in the present case Rs.4000/-). As per the mandate of 1986 Act,  a complaint is supposed to be decided within three months, from the date of service to the opposite party. In cases involving ticklish issues (like the present one, maximum not more than six months to seven months time can be consumed), whereas, to the contrary, as per the principal Act (1996 Act),  the consumer will be forced to incur huge expenses towards his/her share of Arbitrator’s fees. Not only as above, it is admissible to an Arbitrator, to decide a dispute within one year. Thereafter, the Court wherever it is challenged may also take upto one year and then there is likelihood that the matter will go to the High Court or the Hon'ble Supreme Court of India. Such an effort will be a time consuming and costly one. Taking note of fee component and time consumed in arbitration, it can safely be said that if the matter is referred to an Arbitrator, as prayed, in the present case, it will defeat the very purpose of the provisions of 1986 Act.

33.        The 1986 Act provides for better protection of interests and rights of the consumers. For the said purpose, the Consumer Foras were created under the Act. In Section 3 of 1986 Act, it is clearly provided that the said provision is in addition to and not in derogation of any provisions of any other law, for the time being in force. The 1986 Act is special legislation qua the consumers. The poor consumers are not expected to fight the might of multinational companies/traders, as those entities have lot of resources at their command. As stated above, in the present case, the complainant has spent his entire life earnings to purchase the plot, in the said project, launched by the opposite party. However, his hopes were shattered, when despite making substantial payment of the sale consideration, he failed to get possession of the  plot, in question, in a developed project. As per ratio of the judgments in the case of 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), the consumers are always in a weak position, and in cases where two interpretations are possible, the one beneficial to the consumer needs to be accepted. The opinion expressed above, qua applicability of Section 8 (amended) of 1996 Act, has been given keeping in mind the above said principle.

34.        Not only this, recently, it was also so said by 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. 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.”

35.   In  view of the above, the plea taken by the opposite party, that 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, being devoid of merit, is rejected.”

                In view of the above, the plea taken by opposite parties no.1 to 3 in this regard, being devoid of merit, is rejected.

25.         The next question, that falls for consideration, is, as to whether, the complaint filed by the complainants, was premature or not.  It may be stated here that it is an admitted case that offer of possession of the original plot bearing no.877 could not be made till date for want of development works, and on the other hand, amount deposited was also not refunded to the complainants alongwith interest. At the same time, possession of even relocated plot was not offered to the complainants, till date. At the time of relocation of plot, vide letter dated 26.07.2014, terms and conditions with regard to date of delivery of possession was never changed. Thus, opposite parties no.1 to 3, cannot claim any benefit out of their failure, to deliver possession of the originally allotted plot to the complainants and thereafter by relocating them to some other plot, possession of which was also not offered. If the plea of opposite parties no.1 to 3 is accepted that would amount to giving liberty to unscrupulous builders like them (opposite parties no.1 to 3), to adopt such an unfair trade practice on regular basis. Under these circumstances, it is held that the complaint is not premature at all. The submission of Counsel for opposite parties no.1 to 3, in this regard, being devoid of merit, must fail, and the same stands rejected.
26.         In consumer complaint bearing no.827 of 2016, titled as Lakhmir Singh Sandhu Vs. Omaxe Chandigarh Extension Developers Pvt. Ltd., the complainant has sought possession of the plot bearing no.OCE/II/37 measuring 301.38 square yards, in the said project, for an amount of Rs.59,69,728.75ps. Allotment Letter/Agreement in his case was executed between the parties on 19.07.2012 and as per Clause 24 (a) of the Agreement, he was also entitled to delivery of possession of the plot allotted, within a period of 18 months from the date of signing of that Agreement, with extended period of six months. In this manner, possession of the said plot was to be delivered to him, on or before 18.07.2014. However, in his case also, possession of the plot has not been delivered to him by the stipulated date or till date, despite the fact that he has paid substantial amount of Rs.61,80,380.48ps, as is evident from the statement of account dated 21.04.2016 Annexure C-1 (at page 14 of the paper book), for want of basic amenities and development at the site. The said document reveals that the complainant had paid the entire demanded amount, as the balance amount to be received, is shown as “0” therein. Under above circumstances, it is held that the complainant in this complaint is entitled for possession of the plot, allotted in his favour. Apart from possession of the plot, he is also entitled to get compensation by way of interest on the deposited amount, alongwith compensation for mental agony and physical harassment as also litigation expenses, to the quantum, which this Commission is granting in other cases, under similar circumstances, in respect of the same project.
27.         No other point, was urged, by the contesting parties, in both the complaints.
28.         For the reasons recorded above, both the complaints are partly accepted, with costs, in the following manner:-

 

Consumer complaint bearing no.768 of 2016, titled as Harish Bhardwaj and another Vs. Omaxe Chandigarh Extension Developers Private Limited and others, opposite parties No.1 to 3/builder, are jointly and severally directed as under:-

 

1. To refund the amount Rs.56,36,900/-, to the complainants, alongwith interest @12%p.a.,  from the respective  dates  of  deposits onwards.
2. To pay compensation, in the sum of Rs.2.50 lacs, for causing mental agony and physical harassment, to the complainants, as also escalation in prices.
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 @15% p.a., instead of @12%, from the respective dates of deposits onwards, and interest @15% p.a., on the amounts mentioned at sr.nos.(ii) and (iii), from the date of filing of this complaint, till realization.
5. However, it is made clear that, if the complainants have availed loan facility from any banking or financial institution, for making payment of installments towards the said plot, it will have the first charge of the amount payable, to the extent, the same is due to be paid by them (complainants).
6. Complaint qua opposite party no.4 stands dismissed, with no order as to costs.

 

Consumer complaint bearing no.827 of 2016, titled as Lakhmir Singh Sandhu Vs. Omaxe Chandigarh Extension Developers Pvt. Ltd., the opposite party is directed as under:-

1. To hand over actual physical possession of the plot, in question, allotted to the complainant, within a period of 04 months, from the date of receipt of certified copy of this order, complete in all respects, after obtaining necessary occupation/partial/completion certificates, from the competent authorities, on receipt of legally due amount from him (complainant), if any.
2. To execute and get registered the sale deed, in respect of the plot, in question, in favour of the complainant, within two months, from the date of handing over possession, as indicated in Clause (i) above, on payment of registration and stamp duty charges, by him to the Registering Authorities.
3. To pay compensation, by way of interest @12% p.a., on the entire deposited amount, to the complainant, from 18.07.2014 (promised date) to 31.03.2017, within two months, from the date of receipt of a certified copy of this order, failing which, the said amount shall carry penal interest @15% p.a. instead of 12% p.a., till realization.
4. To pay compensation by way of interest @12% p.a. on the entire deposited amount, w.e.f. 01.04.2017, onwards (per month), till actual delivery of actual physical  possession of the unit, by the 10^th of the following month, failing which, the same shall also carry penal interest @15% p.a., instead of 12% p.a., from the date of default, till payment is made.
5. To pay compensation, in the sum of Rs.2.00 lacs, on account of mental agony, physical harassment, caused to the complainant, deficiency in providing service and adopting unfair trade practice, within two months from the date of receipt of a certified copy of this order, failing which, the same shall carry interest @12% p.a., from the date of filing this complaint till realization.
6. To pay cost of litigation, to the tune of Rs.33,000/-  to the complainant, within two months from the date of receipt of a certified copy of this order, failing which, the same shall also carry interest @12% p.a., from the date of filing this complaint till realization.

29.         Certified copy of this order be placed in connected case file, referred to above.
30.         Certified Copies of this order be sent to the parties, free of charge.
31.         The file be consigned to Record Room, after completion.

Pronounced.

20.03.2017

Sd/-

[JUSTICE JASBIR SINGH (RETD.)]

PRESIDENT

 

Sd/-

(DEV RAJ)

MEMBER

 

 

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(PADMA PANDEY)

        MEMBER

 Rg