Punjab

Ludhiana

CC/21/330

Surinder Pal - Complainant(s)

Versus

PUDA - Opp.Party(s)

M.S.Sethi

02 Feb 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                                                Complaint No:330 dated 08.07.2021.                                                         Date of decision: 02.02.2024.

Surinder Pal Singh S/o. Sh. Tarsem Singh, R/o.40, Phase No.01, Sarabha Nagar Extn., Pakhowal Road, Village – Daad, Laltona Kalan, Ludhiana-142002.

                                                                                       ..…Complainant

                                                Versus

1. Punjab Urban Planning and Development Authority, PUDA Complex, Bhagu Road, Phase-1, Model Town, Bathinda-151001 through Chief Administrator/Estate Officer. (

                                                                                      …..Opposite parties 

Complaint Under section 35 of the Consumer Protection Act, 2019.

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

SH. JASWINDER SINGH, MEMBER

MS. MONIKA BHAGAT, MEMBER

COUNSEL FOR THE PARTIES:

For complainant             :         Sh. M.S. Sethi, Advocate.

For OPs                          :         Sh. G.S. Anand, Advocate.

ORDER

PER JASWINDER SINGH, MEMBER

1.                Shorn of unnecessary details, the facts of the case are that in the month of July 2011, OP1 invited application for allotment of 561 freehold residential pots at PUDA Enclave, Baba Farid University site at Faridkot. As the complainant had no residential house/plot, so he applied for residential plot of 125 sq. yards and purchased brochure of Rs.100/- in which the details of plot offered for allotment of draw was given. The complainant deposited Rs.62,500/- as 10% initial deposit being earnest money for participation in the draw. The complainant stated that OP1 vide allotment letter dated 03.05.2012 informed him regarding allotment of residential plot No.650 measuring 125 sq. yards under General Category in PUDA Enclave, Baba Farid University site and advised him to deposit 15% amount i.e. Rs.93,750/- within 30 days from the date of issue of allotment letter dated 03.05.2012, which the complainant paid vide draft No.025675 dated 30.05.2012 in the name of Estate Officer PUDA Bathinda. Further as per allotment letter, the complainant paid 1^st installment of Rs.1,34,375/- dated 08.05.2013. Thereafter, the OPs vide letter dated 11.09.2013 informed the complainant that due to court case, planning has been affected and due to re-planning plot No.650 measuring 125 sq. yard had become corner plot due to which complainant is liable to pay sum of Rs.62,500/- being 10% more and OP1 rescheduled the future installments.

                   The complainant further stated that as per clause No.4(V) of the allotment letter dated 03.05.2012, in case balance payment is made in lump sum subsequently at any stage, a rebate of 5% on the balance principal amount shall be admissible and as such, the complainant along with letter dated 24.01.2024 deposit the balance 3^rd to 6^th installments in lump sum payment after deducting 5% principal amount, regard which the OPs issued receipt dated 24.01.2014. The detail of payment is reproduced as under:-

According to the complainant, in all he paid Rs.7,72,813/- including Rs.6,16,563/- and Rs.1,56,250/- being 25% with the OPs till 24.01.2014 after taking discount of 5% on the remaining due amount as per clause 4(V) of the allotment letter dated 03.05.2012. The complainant further stated that the OPs were liable to handover the possession of plot within 18 months under clause 10 from the date of issuance of allotment letter dated 03.05.2012 but they failed to provide the physical possession by 02.11.2013 and even till date, the OPs have failed to complete the development work at site as well despite the complainant had made full payment for getting possession of allotment plot. Even the OPs have not developed the area before completion of installment periods as the OPs were in litigation with actual owners of land. The OPs have also failed to get occupation and completion certificate of their project due to which the OPs failed to hand over the possession of the plot to the allottees. The complainant claimed to have visited the site number of times and found no development stated by the OPs. The complainant time and again requested the OPs to hand over the possession after development but they orally informed that due to technical hitch they are not in a position to develop the area. Seeing no development after the prescribed period ending on 02.11.2013 as per allotment letter dated 03.05.2012, the complainant requested the OPs for refund of deposited amount and also vide letter dated 12.04.2021, the compoainant requested the OPs to refund the money paid against allotment of plot in question. The OPs vide reply dated 18.06.2021 informed the complainant that after deducting 10% i.e. Rs.82,051/- out of deposited amount of Rs.7,72,813/-, PUDA is planning to refund the balance amount of Rs.6,90,762/- to the complainant and further asked the complainant to submit written objection within 10 days if he is having any objection regarding the calculation otherwise thereafter no objection will be heard and the calculated amount will be refunded to him. The complainant further stated that on 23.06.2021, he visited the OPs at Bathinda and submitted written letter with objection that he is not agree with said calculation rather he deserves full refund of Rs.7,72,813/- with interest. But no receiving to the said letter was given neither any reply to the said letter nor any refund of the deposited amount was given. The complainant further stated that the OPs are not liable to deduct 10% i.e. Rs.82,051/- as it is the OPs who have failed to start any development work at the site which they assured in the allotment letter even after expiry of stipulated period of 18 months ending on 02.11.2013. The OPs have failed to initiate any development work at the site and have also failed to provide basis amenities. According to the complainant, following works were not started:-

1. No OHSR has been constructed for water supply.
2. Neither the land was fixed for STP nor had any work been initiated to establish/construct and install the sewerage treatment plant.
3. Opposite party failed to get the electricity connection and also failed to getting substation constructed.
4. There was no plantation along side roads, development of parks was also lacking.
5. There is no space allotted for commercial zone, dispensary, club house, school and for parking as shown by the opposite party in the layout plan.
6. Opposite party also failed to initiate the construction work of roads, lanes and footpath. No provision had been made for installation of street lights.
7. There was no boundary wall got constructed, putting the safety and lives of the residents at stake. It may also lead to encroachment of the land of the site.
8. No rain water harvesting system had been installed.
9. Opposite party also failed to provide even the basic amenities, like garbage collection centre/bins and other civil amenities.
10. It also failed to fill low lying area to prevent collection of water.

The complainant further stated that this amounts to unfair trade practice on the part of OPs in utilizing the money belonging to the consumers. Further the deduction of Rs.82,051/- by the OPs is not in accordance with the provisions of section 45 of the PUDA Act, 1995 and they are liable to deduct 10% of total amount in case of any breach of any condition(s) of the allotment or of regulation or non-payment of any amount due together with the penalty etc. The act and conduct of the OPs in not handing over the physical possession of the plot after completing the development works even after expiry of stipulated period of 18 months from the date of allotment, amounts to deficiency in service and unfair trade practice. In the end, the complainant has prayed for issuing directions to declare the letter dated 18.06.2021 of the OPs regarding deduction of Rs.82,051/- as 10% out of deposited amount of Rs.7,72,813/- to be illegal, null and void or to refund the amount of Rs.82,051/- is deducting during pendency of complaint and also to refund the total amount of Rs.7,72,813/-. The complainant further prayed for issuing directions to the OPs to pay compensation of Rs.2,00,000/-along with litigation expenses of Rs.55,000/-.

2.                Upon notice, the OPs appeared and filed written statement and by taking preliminary objection assailed the complaint on the ground of maintainability, lack of jurisdiction; lack of limitation; presentation of misleading facts; the complaint being barred on the ground of estoppel etc. According to the OPs, State of Punjab enacted Punjab Regional and Town Planning and Development Act, 1995 with intention to develop the land in a planned manner in Punjab for which The Punjab Urban Planning and Development Authority (PUDA) framed a scheme for allotment of residential plots under OUVGL Scheme Faridkot, on the land transferred to it by the State Government and they made advertisements in the leading newspapers for sale of PUDA plots at PUDA Enclave, Baba Farid University Site Faridkot. The complainant applied for plot measuring 125 sq. yards vide application Form No.5307 and vide allotment letter dated 03.05.2012 memo No.2015 the complainant was allotted plot No.650. The complainant had gone through the terms and conditions of the allotment letter before proceeding in the scheme and he deposited Rs.1,56,250/- which was adjusted towards 25% of the plot amount with PUDA. The relevant terms and conditions of the allotment letter are reproduced as under:-

1.  If refund of earnest money is sought by the applicant before the draw of lot only a Token deduction of Rs.500 will be made.
2. The possession of the said plot shall be handed over to the allottee after completion of development works at site or 18 months from the date of issue of allotment letter whichever is earlier. If possession is not taken by the allottee within stipulated period, it shall be deemed to have been handed over on the expiry of said date.
3. Construction on plot shall be completed within a period of 3 years from the date of possession after getting the building plans and as per the provisions of PUDA (buildings) Rules 1996 as amended from time to time.
4. Construction shall be carried out as per sanctioned building plans and as per the provisions of PUDA (building) rules 1996 as amended from time to time.
5. The allotment shall be governed by the provision of Punjab Regional and Town Planning & Development Act, 1995, Rules and Regulations & Policies framed there under, as amended from time to time.
6. In case of surrender/refusal by the allottee at any stage after the draw /allotment, action will be taken, as per provisions of the Punjab Regional & Town Planning & Development Act, 1995 and instruction/policies issued there under.
7. In case of breach of any conditions of allotment or regulations or non-payment of any amount due together with the penalty, the plot or building as the case may be, shall be liable to be resumed and in that case an amount not exceeding 10% of the total amount of consideration money, interest and other fees payable in respect of plot shall be forfeited as per the provision of section 45(3) of the Punjab Regional & Town Planning & Development Act, 1995.
8. Subject to the provisions of the act, all the disputes and/or differences which may arise in any manner touching or concerning this allotment shall be referred to the sole Arbitrator, Chief Administrator, Punjab Urban Planning and Development Authority (PUDA) ог any person appointed/nominated by him in this behalf. The award of such Arbitrator shall be final and binding on the parties. Arbitration and conciliation Act, 1996 as amended from time to time.
9. In case refusal to accept the allotment offer, such refusal in writing through a registered post should be received within 30 days from the date of issue of LOI, 10% amount of earnest money shall be forfeited. In the event, such refusal is received after a period of 30 days from the issue of LOI, entire earnest money deposited shall be forfeited.

The OPs further averred that there is an arbitration clause in the allotment letter to settle the dispute or difference arising out of allotment of the site in question and the matter is required to be referred to the arbitration under the provisions of Arbitration and Conciliation Act, 1996. According to the OPs, the complainant has not applied for building plan and water supply connection. As per report of technical wing of department vie letter No.3713 dated 12.11.2014, the development work was complete and site was ready for delivery of possession to the allottee and even a public notice was published in newspaper dated 11.12.2014 informing all the allottees to take possession by visiting the office of OP on any working day. The OPs also got published the public notices in newspaper Ajit on 11.12.2014 but the complainant never approached OP department and as such, he is himself at fault. Moreover, the complainant has booked the plot for investment/commercial purpose in order to gain profits as the plot in question of located at Faridkot whereas the complainant is resident of Daad, Lalton Kalan, district Ludhiana. Even as per clause 14 of the allotment, the construction of the plot shall be completed within a period o 3 years from the date of possession after getting the building plans approved architect. But the complainant was never ready and willing to possess the property in real and has failed to comply with the same. As such, the complainant is not entitled to any refund.

                   On merits, the OPs reiterated the crux of averments made in the preliminary objections as well as factual submission. The OPs have denied that there is any deficiency of service and have also prayed for dismissal of the complaint.

3.                In support of his claim, the complainant tendered his affidavit Ex. CA in which he reiterated the allegations and the claim of compensation as stated in the complaint. The complainant also tendered documents Ex. C1 and Ex. C2 is the copy of brochure, Ex. C3 is the copy of allotment letter dated 03.05.2012, Ex. C4 is the copy of demand draft of Rs.93,750/- dated 30.05.2012, Ex. C5 is the copy of receipt of Rs.1,34,375/- dated 08.05.2013, Ex. C6 is the copy of letter dated 11.09.2013 regarding pending litigation, Ex. C7 is the copy of receipt of Rs.1,17,813/- dated 05.11.2013, Ex. C8 is the copy of receipt of Rs.3,44,375/- dated 24.01.2014, Ex. C9 is the copy of letter of the complainant regarding lump sum payment, Ex. C10 is the copy of letter dated 12.04.2021 of the complainant for refund of deposited amount, Ex. C11 and Ex. C12 are the copies of postal receipts, Ex. C13 is the copy of letter dated 18.06.2021 written by the OPs to the complainant, Ex. C14 is the copy of receipt of Rs.20,000/- dated 15.05.2018, Ex. C15 to Ex. C18 are the photographs of the site, Ex. C19 is the newspaper dated 03.07.2021, Ex. C20 is the copy of Aadhar card of the complainant and closed the evidence.

4..               On the other hand, the counsel for the OPs tendered affidavit of Ms. Balwinder Kaur, Estate Officer, Bathinda Development Authority having its office at PUDA Complex, Bhagu Road, Bathinda and closed the evidence.

5.                We have heard the arguments of the counsel for the parties and also gone through the complaint, affidavit and annexed documents and written reply along with affidavit produced on record by both the parties. We have also gone through the written arguments submitted by the complainant.

6.                Admittedly, the complainant was declared a successful allottee by way of draw of lots and was allotted a plot bearing No.650 measuring 125 sq. yards under General Category in PUDA Enclave, Baba Farid University site, Faridkot vide allotment letter dated 03.05.2012 Ex. C3. The complainant made all the payments, the detail of which is reproduced as under:-

The OPs were liable to deliver the possession of the plot within 18 months from the date of issuance of allotment letter i.e. up to 02.12.but the OPs failed to carry out development work along with promised facilities at ground level. After a long wait for more than 7 years, the complainant requested the OPs to refund the amount received vide application dated 12.04.2021 Ex. C10. However, the OPs vide letter dated 18.06.2021 Ex. C13 offered the complainant a refund of Rs.6,90,762/- after deducting 10% i.e. Rs.82,051/-out of the total deposited amount. Now the complainant has raised a grievance that the proposed deduction of 10% is illegal, arbitrary and he is entitled to refund of entire amount deposited by him along with interest and compensation.

8.                The counsel for the OPs contended that the complainant is not entitled for any relief of full refund of deposited amount. The allottees vide publication in newspapers on 11.12.2014 were informed to take possession after receipt of report of technical wing of the department vide letter No.3713 dated 12.11.2014 regarding completion of development work and site being ready for delivery of possession to the allottees.

9.                On the other hand, the counsel for the complainant refuted the allegations and contended that the complainant had invested a huge amount in the project of the OPs for the purchase of the plot for his residential purposes but due to the failure of the OPs in handing over the possession of the plot, complainant had to suffer immense harassment and was deprived of usage of the same. Not only this, till date the OPs are enjoying the benefits of the amount deposited by the complainant and such like other consumers.

10.              The issue of proposed deduction revolves around the clause 10 of the allotment letter Ex. C3 which is reproduced as under:-

“10.  Possession of plot shall be handed over to allottee after completion of development works at site in a period of 18 months from the date of issuance of allotment letter. In case for any reason PUDA is unable to deliver the possession of the plot in stipulated period, allottee shall have a right to withdraw from the scheme by moving an application to the Estate Officer, in that case the Authority shall refund the amount deposited by the application after deducting 10% of the amount deposited.”

Bare perusal of this clause 10 shows that it has given unbridled powers to the OPs to deduct 10% of the amount deposited, even if  there is no development at the site or for any other reasons for which the OPs could not have delivered the possession of the plot within stipulated period of 18 months. So the clause 10 is heavily loaded in favour of the OPs and directly adversely impacts the valuable rights of the complainant. Such unilateral unreasonable and harsh terms could not be deemed to be final and binding upon the complainant.  In Pioneer Urban Land & Infrastructure Ltd., Vs. Govindan Raghwan (2019) 5 SCC 725, Hon’ble Supreme Court has observed that “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 incorporation of one sided clause in an agreement constitute 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 flats by the builder….., the appellant-builder cannot seek to bind the respondent with such one sided contractual terms.”        

11.              The complainant has consistently pleaded that the OPs had failed to execute development works along with promised facilities even till the date of filing the present complaint. In para No.14 of his complaint, the complainant enlisted 10 development works which are yet to be started or completed. The OPs were required to give a categorical reply with regard to the initiation or completion of each work but the OPs were non-committal and their reply was evasive which amounts to admission on their part. The OPs are repeatedly relying upon  the letter No.3713 dated 12.11.2014 with regard to completion of development work but even that letter being the best evidence also not produced before this Commission and was withheld by the OPs for the reason best known to their officials. So this Commission is constrained to draw adverse inference against the OPs for the non-production of the said letter. During the course of arguments, the counsel for the complainant produced photographs 12 in numbers in addition to photographs Ex. C15 to Ex. C18 already produced on record. After the perusal of these photographs, this Commission is not inclined to conclude that the development work has been completed and site is ready for possession to the plot holders. The act and conduct of the OPs amounts to deficiency in service on their part.

12.              In this regard, reference can be made to Ireo Grace Realtech Pvt. Ltd. Vs Abhishek Khanna & another (2021) 3 SCC 241, the Hon’ble Supreme Court has held that “allottees who have not been given possession, cannot be made to wait indefinitely for possession, nor they can be bound to take possession in other phase of the project. Such allottees are entitled to refund of entire amount deposited by them.” Further reference can be made to Wg. Cdr. Arifur Rahman Khan and Aleya Sultana and others Vs DLF Southern Homes Pvt. Ltd. & others (2020) 16 SCC 512, whereby the Hon’ble Supreme Court of India has held that “failure of the developer to comply with the contractual obligation to provide the flat to a flat purchaser within the contractually stipulated period, amount to deficiency.” Further, it has been held by the Hon’ble Supreme Court that “in case of gross delay in handing over possession by builder beyond contractually stipulated period, flat purchaser is entitled to just and reasonable compensation for such delay and such compensation not constrained by terms of rate which is prescribed in an unfair bargain.

                   As such, after appreciating the rival contentions of the parties as well as after perusing the documents on record, this Commission is of the view that the complainant is entitled to compensation for deficiency of service and unfair trade practice on the part of the opposite party. The provisions of the Consumer Protection Act enable a consumer to claim and empowers the Commission to redress injustice done to the complainant. The amount of compensation can be determined by taking into facts and circumstances of each case and also mitigating circumstances that may arise in favour of the opposite party as well. Reference can be made to 2020(3) Apex Court Judgments 27 (S.C.) in DLF Home Developers ltd. (Earlier known as DLF Universal Ltd.) & another Vs Capital Green Flat Buyers Association Etc. In these set of facts and circumstances, it would be just and appropriate if the OPs are directed to refund the deposited amount Rs.7,72,813/- along with interest @9% per annum w.e.f. January 2014 (i.e. after expiry of tentative period of completion of 18 months of issuance of allotment letter dated 03.05.2012) till its actual payment within 30 days from the date of receipt of copy of order, failing which the complainant shall be held entitled for further interest @3% per annum on from the date of order till actual payment. The OPs shall further pay composite cost of Rs.20,000/- to the complainant.

13.              As a sequel of above discussion, the complaint is partly allowed with direction to the opposite parties to refund the deposited amount Rs.7,72,813/- along with interest @9% per annum w.e.f. January 2014 (i.e. after expiry of tentative period of completion of 18 months of issuance of allotment letter dated 03.05.2012) till its actual payment within 30 days from the date of receipt of copy of order, failing which the complainant shall be held entitled for further interest @3% per annum on from the date of order till actual payment. The OPs shall further pay a composite cost of Rs.20,000/- (Rupees Twenty Thousand only) to the complainant. Compliance of the order be made within 30 days from the date of receipt of copy of order. Copies of the order be supplied to the parties free of costs as per rules. File be indexed and consigned to record room.

14.              Due to huge pendency of cases, the complaint could not be decided within statutory period.

(Monika Bhagat)          (Jaswinder Singh)                     (Sanjeev Batra)

Member                         Member                                       President         

Announced in Open Commission.

Dated:02.02.2024.

Gobind Ram.