Delhi

StateCommission

CC/1188/2016

RAJIV SHARMA - Complainant(s)

Versus

PARSVNATH DEVELOPERS LTD.& ANR. - Opp.Party(s)

MASOOD HUSSAIN

06 Mar 2020

ORDER

 

IN THE STATE COMMISSION: DELHI

(Constituted under Section 9 of the Consumer Protection Act, 1986)

 

                                                             Date of Decision: 06.03.2020.

 

 

Complaint Case No. 1188/2016

 

In the matter of:

 

 

Mr. Rajiv Sharma

S/o Late Sh. P.C. Sharma

R/o C-702 Geetanjali Apartment

Karkardooma, New Delhi-110092...Complainant

 

 

Versus

 

 

1. Parsvnath Developer Limited

 

2. Mr. Pradeep Jain (Director)

 

3. Mr. Sanjeev Jain (Director)

         

          All Residents of:

 

          Corporate Office at: 6^th Floor,

          Arunachal Building,

          19 Barakhamba Road, New Delhi-1

          Regd. Office at; Parsvnath Metro Tower

Near Shahdara Metro Station

Shahdara, Delhi-110032…Opposite Parties

 

 

CORAM

Ms. Salma Noor, Presiding Member

 

1.       Whether reporters of local newspaper be allowed to see the judgment?                             

2.       To be referred to the reporter or not?                                        

 

 

Ms. Salma Noor, Presiding Member

 

1. This is a complaint filed by the complainant under Section 17 of the Consumer Protection Act (in short ‘the Act’) alleging deficiency in service on the part of OPs.
2. The facts relevant for disposal of the complaint are that pursuant to the advertisement given by the OPs in the newspapers with regard to its upcoming project, namely, “Parsvnath Palacia” at Plot No. 5, Sector PI-I & II, Greater Noida, UP, the complainant booked one residential flat vide application dated 27.07.2013 having super area 1710 sq. ft. for a total sale consideration of Rs.57,15,675/-  excluding car parking and service charges. Subsequently, an Apartment Buyer Agreement dated 09.11.2013 was executed between the parties. It is stated that said booking was made under the plan of 25:75 meaning thereby 25% was to be paid at the time of booking and remaining 75% at the time of possession of the flat. It is stated that as per the Agreement, OPs were liable to hand over the possession within 36 months excluding grace period of six months from the date of construction of site which was started much prior to signing of the application dated 27.07.2013. It is stated that complainant has paid a sum of Rs.15,96,224/- at the time of booking which was made as per plan i.e. 25% of the total sale consideration. It is stated that complainant approached the OPs but no satisfactory reply was given about the completion of the units. Thereafter, complainant visited the proposed site and found that no work is going on the site. Subsequent to which the complainant approached the OPs for refund of an amount of Rs.15,96,224/- but OPs avoided to pay the sum on one pretext or the other. It is stated that no action was taken by the OPs either to allot the unit or to refund the amount. It is stated that as no action was taken by the OPs on the request of the complainant, the complainant issued a legal notice dated 26.07.2016 calling upon OPs to make the payment of Rs.15,96,224/- alongwith interest @18% p.a. The notice was duly received by the OPs, however, no money was refunded.
3. Alleging deficiency in service on the part of OPs, complainant has filed the present complaint seeking directions to the OPs to refund the paid amount of Rs.15,96,224/- alongwith interest @18% p.a. and compensation of Rs.2,00,000/- for harassment and  mental agony.
4. Upon being served OPs entered its appearance and filed its written statement wherein apart from denying the allegations of the complainant, the OPs, inter-alia, raised preliminary objections that the complainant is not a “consumer” and has merely made an investment with the OPs to earn profits, the complaint is bad for mis-joinder and non-joinder as complainant had entered into the Tripartite Agreement with Finance Company and OPs, the OPs have not breached or violated any provisions of the Flat Buyers Agreement and complaint has been filed without any cause of action. The complaint involved complicated questions of facts and law which need to be proved by leading oral and documentary evidence and that since the proceedings before the Consumer Courts are summary in nature, the forum has no jurisdiction to entertain the present complaint.
5. On merits, OPs have admitted the execution of the Flat Buyer Agreement and the payments made by complainant are also not denied by the OPs. It is stated that due to global recession the development work at the site slowed down. The OPs have denied that possession was to be handed over within 36 months plus six months grace period. It is stated that as per clause 10 (a) of the Agreement the construction of the flat is likely to be completed within the period of 36 months from the date of commencement of construction. It is stated that rights of the complainant is duly protected as stipulated in clause 10 (c) of the Agreement. OPs have denied deficiency in service and unfair trade practice on their part. It is denied that OPs are liable to pay interest, compensation etc as is claimed by the complainant. A prayer is made for dismissal of the complaint.
6. Rejoinder is filed by the complainant to the written statement of OPs wherein the allegations made by the OPs against complainant is denied. The complainant has reiterated averments of the complaint case.
7.  Both the parties filed evidence by way of affidavits alongwith written arguments.
8.  I have heard counsel for the parties and perused the material on record.
9.  As regards the objections that complainant is not a consumer and the booking has been made to earn profit is completely unsustainable. The onus of establishing that the complainant was dealing in real estate is on the developer, which in the present case the OPs have failed to discharge or file any documentary evidence to prove the same. Therefore, I am of the considered view that complainant is a ‘Consumer’ as defined under Section 2(1)(d) of the Act. Reliance is placed on the judgment of Hon’ble National Commission in Kavita Ahuja vs. Shipra Estates I (2016) CPJ 31.
10.  As regards the objection that complaint involves complicated question of facts and law as such the consumer cannot be entertained by the Commission. However, the same is not pressed at the time of arguments. Further, I do not find any complicated question of law and facts being involved in the present case. Accordingly, the said objection is rejected.
11.  Another objection raised by the OPs is that the complaint is bad for mis-joinder and non-joinder of necessary parties as complainant has not made the Finance Company a party to the complaint as a Tripartite Agreement was also entered between the parties. The said objection has no force, firstly, the complainant has not made any mention of taking loan and entering into any tripartite agreement, secondly, the OPs in its written statement as well as in evidence has merely stated that Finance Company has not been made a party and a Tripartite Agreement has been entered into between the parties. However, OPs have failed to place on record any documentary evidence in this regard. The onus to prove the allegations lies upon the OPs, in the first instance the OPs have neither mentioned the name of the finance company nor has filed the copy of the Tripartite Agreement in support of its contention. Further, no claim has been made by the complainant against the finance company in its complaint from whom the complainant has been alleged to have taken loan by the OPs. Accordingly, the said objection is also rejected.
12.  Learned counsel for the complainant stated that as per the possession clause 10(a) of the apartment buyer agreement, the possession was to be handed over within 36 months with a grace period of six months. However, OPs have not offered the possession so far. It is stated that when the complainant contacted the OPs about delivery of possession and enquired about the status of construction, no information was given about the progress of the work. It is further stated that when the complainant visited the site, there was nothing existing in the name of construction at the site wherein the flat was allotted to him. Therefore, complainant asked the OPs to inform about status of the construction and even issued the legal notice., however, no reply was received.
13.  Ld. Counsel for complainant has contended that OPs have failed to fulfill its commitment and did not hand over the possession within 36 months as was assured by the OPs. It is contended that there is no likelihood of the same being completed in near future.  It is contended that the complainant has no option but to seek the refund of money. It is contended that nothing has also been placed on record by the OPs to substantiate that due to recession in the market, OPs have not been in a position to complete the project. It is submitted that frivolous stand is taken by OPs in this regard. It is submitted that money deposited by complainants be refunded with 24% interest along with suitable compensation and costs of litigation.
14.  Ld. Counsel for the OPs have contended that due to phenomenon of global recession which affected the real estate section in India, development work at the site could not be completed and the same is a force majeure circumstance, which was beyond the control of the OPs. It is submitted that it is the endeavour of the OPs to hand over the possession to the complainant at the earliest.  It is contended that even if there is a delay on the part of OPs in completing the project, the right of the complainant is duly protected and as such the complaint filed is baseless.  It is contended that there is no deficiency in service on the part of the OPs.
15.  The submission, viewed from any angle, cannot be said to be a "Force Majeure Event". The Opposite Parties have not filed any material on record to prove that the reasons were beyond their control. As no material has been produced by the Opposite Parties to prove that the completion of construction and offer of possession has been delayed on account of reasons beyond their control, there is no justification for the said delay. I find it a fit case to place reliance on judgment of the Hon’ble National Commission in Emmar MGF Land Ltd. & Ors.  vs. Amit Puri [II (2015) CPJ 568 NC], wherein it was laid down that after the promised date of delivery it is the discretion of the Complainant whether he/she wants to accept the offer of possession, if any, or seek refund of the amounts paid with reasonable interest. In the instant case, the Complainant sought for refund of the principal amount with interest and compensation as construction is still not complete.
16.  I am of the considered view that the complainant cannot be made to wait indefinitely for the delivery of possession and the act of the Opposite Parties in relying on Force Majeure clause while retaining the amounts deposited by the Complainant, is not only an act of deficiency in service but also of unfair trade practice, especially in light of the view and the fact that the Developer charges interest @ 24% p.a.  for any delay in the payments made by the Flat purchasers, but at the same time, stipulates in Clause 10(c) of the Agreement that compensation would be paid at Rs.53.82 per sq. meter or Rs.5/- per sq. ft. of the super area per month for the period of delay, which approximately amounts to only 1.5% per annum. I am of the view that such terms in Clauses are extremely unfair and one-sided and fall within the definition of 'unfair trade practice' as defined under Section 2(r) of the Act.
17.  At this juncture, I find it a fit case to place reliance on the recent judgment of the Hon'ble Apex Court in Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan, II (2009) CPJ 34 (SC), wherein the Apex Court has observed as follows:

 

"6.7.    A term 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 could not seek to bind the Respondent with such one-sided contractual terms."

 

18. For all the reasons stated above, this judgment squarely applies to the facts and circumstances of this case. I also find it a fit case to place reliance on the judgment of the Hon'ble Supreme Court in Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra, II (2019) CPJ 29 (SC), in which the Hon'ble Apex Court has observed as hereunder:

 

"..........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 is 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."

 

19. In the instant case also agreement was executed between the parties on 09.11.2013 and till date no offer of possession has been made by the OPs, the complainant cannot be made to wait indefinitely for possession of the unit, as the construction is yet to be completed even after a period of more 06 years from the date of Agreement. Therefore, I am of the considered view that the Complainant is entitled for refund of the principal amount with reasonable interest.                       
20. In Fortune Infrastructure & Anr. v. Trevor D’Lima & Ors., (2018) 5 SCC 442, it is held by Hon’ble Supreme Court that a person cannot be made to wait indefinitely for possession of the flat allotted to him, and is entitled to seek refund of the amount paid by him, along with compensation.
21. It has also been held by the National Commission in catena of judgments that when possession of the allotted flat is not delivered within the specified time, the allottee is entitled to refund of amount paid, with reasonable interest thereon from the date of payment till the date of refund. Reliance is placed on the judgments of National Commission titled Subodh Pawar v. M/s Ireo Grace Realtech Pvt. Ltd. & 4 Ors. dated 24.09.2018 in CC No.1998/2016 and Amit Arora v. M/s Ireo Grace Realtech Pvt. Ltd. dated 27.03.2019 in CC No.696/2017.
22. Present is a clear case of deficiency in service and unfair trade practice on the part of OPs. Complainants are legally entitled to seek refund of the money deposited by them with OPs along with appropriate compensation. The complainants have prayed for award of interest @ 24% p.a. Ld. Counsel for OPs has opposed the award of interest by contending that same is on very higher side. However, keeping in mind the facts and circumstances of the case, I award compensation in the form of interest @ 10% p.a. from date of deposit till realization. Accordingly, OPs are directed as under:

1. The Opposite Parties are directed to refund the amount deposited by the complainant with the OPs i.e. Rs.15,96,224/- along with compensation in the form of interest @ 10% p.a. from the date of each deposit till realization.

 

2. The Opposite Parties shall also pay a sum of Rs.25,000/- towards cost of litigation to complainant.

 

23. A copy of this order as per statutory requirements be sent to the parties free of cost. Thereafter the file be consigned to record room. 

 

 

(Salma Noor)

Presiding Member