DR. SADHNA SHANKER, MEMBER

1.       This appeal has been filed under section 19 of the Consumer Protection Act, 1986 (hereinafter referred to as the ‘Act’) in challenge to the Order dated 21.06.2018 of the State Commission in complaint no. 593 of 2017, whereby the complaint was disposed of.

2.       We have heard the learned counsel for the appellant (hereinafter referred to as the ‘developer’) and learned counsel for the respondents (hereinafter referred to as the ‘complainants’) and have perused the record including inter alia the Order dated 21.06.2018 of the State Commission and the memorandum of appeal.

3.       There is a delay of 10 days in filing the present appeal.  

No application for condonation of delay in filing the appeal has been filed. However, in the interest of justice, the delay of 10 days in filing the appeal is condoned.

4.       The facts, in brief, of the case are that on 01.11.2012, the complainants entered into an agreement with the developer to purchase a self-contained flat measuring about 1295 sq. ft. more or less on the 6^th floor situated at Block – Vibhuti, Phase – II, together with one covered car parking space on the ground floor under project ‘Deeshari Megacitgy’ situated at Holding No. 116, Dwarir Road, South Jagaddal, P.S. Sonaripur, Kolkta, Dist. – South 24 Parganas within the local limits of Ward No. 24 of Rajpur-Sonarpur Municipality for a total consideration of Rs. 34,55,125/-. The complainants have already paid a total sum of Rs. 32,11,713/-. As per agreement, the possession of the flat would be handed over by December 2015 in a habitable condition. It is alleged that despite expiry of stipulated period, the developer did not take any step to hand over the subject flat to the complainants. In the agreement, it was also agreed that the developer will pay a sum of Rs. 8,000/- only per month in case the developer failed to hand over the subject flat by December 2015. Despite this, the complainants alleged that they have been paying licence fee of Rs. 17,000/- only per month till July 2016 and the same had been enhanced to Rs. 17,500/- only per month since August, 2016 till June 2017 and at present the complainants are paying the licence fee of Rs. 17,000/- only per month to his present landlord with effect from July 2017. It is alleged that the complainants have made several correspondences with the developer regarding demand of amount of compensation of Rs. 8000/- only per month from January, 2016 onwards in terms of the agreement but all went in vain.

5.       Hence, alleging deficiency in service on the part of the developer, the complainants have filed a complaint before the State Commission with the following prayer:

1. For a declaration that Opposite Party No. 1 has committed negligence and deficiency of service and unfair trade practice.

2. For a direction upon the Opposite Parties to pay a sum of Rs. 1,12,000/- (Rupees One Lakh and Twelve Thousand only) as compensation from January, 2016 to February 2017 in terms of the said Agreement for Sale dated 01.11.2012 and to pay the said compensation at the rate of Rs. 8,000/- (Rupees Eight Thousand) per month to the complainants in terms of the aforementioned Agreement for sale dated 01.11.2012 till the actual lawful physical possession of the said Flat described in the schedule below is given to the complainants.

3. For a direction upon Opposite Parties to pay interest on Rs. 32,11,713/- on such rates as this Hon’ble Commission may deem fit and proper.

4. For a direction upon the opposite parties to pay the sum of the rent and/or licence fees on and from 1^st January, 2016 to till the date of handing over of lawful possession of the flat booked at Deeshari Megacity Project morefully described in the schedule below to the complainants.

5. For a direction upon the opposite parties to complete the Building Block Vibhuti, Phase II and the said flat morefully described in the schedule hereunder within a specified time which this Hon’ble Commission thinks fit and proper.

6. For a direction upon the opposite parties to procure Completion certificate and/or Occupancy Certificate from the appropriate authorities and to hand over the physical possession of the said flat morefully described in the schedule below to the complainants within such stipulated time as may be determined by the Hon’ble Commission.

7. For a direction upon the opposite parties to register the said flat morefully described in the schedule hereunder before the appropriate registry office within such stipulated time as may be determined by this Hon’ble Commission.

8. For a direction upon opposite parties to inform the amount of the ‘other cost’ with proper calculation in terms with the agreement dated 01.11.2012 instead of quoting arbitrary figure to the complainants.

9. For a direction upon the opposite parties to provide a sanctioned copy of the building plan for the building Block “Vibhuti” phase II in the housing project Deeshari Megacity.

10. For a direction upon the Opposite Parties to pay compensation of Rs. 20,00,000/- (Rupees Twenty Lakhs) only to the complainants for causing mental and physical agony, harassment.

11. For a direction to the opposite parties to pay a litigation cost of Rs. 30,000/- (Rupees Thirty Thousand) only.

6.       The State Commission, vide its Order dated 21.06.2018, disposed of complaint and directed the developer to obtain completion certificate / occupancy certificate from Rajpur-Sonarpur Municipality to deliver possession and to execute and register the Sale deed in respect of the property as mentioned in Schedule-I of the Agreement in favour of the complainants along with compensation in the form of interest at the rate of 10% per annum on the deposited amount of Rs.32,11,713/- from the committed date of possession i.e. from 01.01.2016 till the date of delivery of possession. The State Commission also directed the developer to pay a sum of Rs. 2,32,000/- @8000/- per month as compensation from January, 2016 to May, 2018 in terms of the agreement for Sale dated 01.11.2012 and shall pay compensation month by month from the month of June, 2018 till the delivery of actual physical possession along with Rs. 10,000/- as cost of litigation. The balance amount of Rs. 2,43,212/- payable by the complainants shall be adjusted by the developer in the compensation payable to the complainants. The State Commission in its order dated 21.06.2018 has mentioned that despite the service of notice, the developer had not appeared to contest.

7.       Aggrieved by the order dated 21.06.2018 of the State Commission, the developer has filed the instant appeal before this Commission.

8.       On 22.02.2019 before this Commission, learned counsel for the developer has made a categorical statement that the developer (appellants) is agitating only the following direction contained in the impugned order of the State Commission:

“ii. The Opposite Parties are directed to pay compensation over the amount of Rs. 32,11,713/- in the form of simple interest @10% from the committed date of possession i.e. from 01.01.2016 till the date of delivery of possession.”

9.       Before this Commission, learned counsel for the developer has argued that interest at the rate of 10% per annum granted by the State Commission is on the higher side and in support of this contention, he placed reliance on the decision rendered in the case of Wing Commander Arifur Rahman Khan and Aleya Sultana and Ors. Vs. DLF Southern Homes Pvt. Ltd., (2020) 16 SCC 512.  wherein it was held as:

“54. …. The general appreciation in land values results in an increase in the value of the investment made by the buyers. Difficulties in determining the measure of compensation cannot however dilute the liability to pay. A developer who has breached a clear representation which has been made to the buyers of the amenities which will be provided to them should be held accountable to the process of law.”

“69.1. ….the first and second respondents shall, as a measure of compensation, pay an amount calculated @ 6 per cent simple interest per annum to each of the appellants. The amount shall be computed on the total amounts paid towards the purchase of the respective flats with effect from the date of expiry of thirty-six months from the execution of the respective ABAs until the date of the offer of possession after the receipt of the occupation certificate.”

10.     Learned counsel for the complainants has argued that the rate of interest granted by the State Commission is just and proper and the State Commission has passed a well-reasoned order.

11.     It is not in dispute that the complainants had booked the flat. It is also not in dispute that the complainant and the developer had entered into an agreement on 01.11.2012 and as per the agreement, the possession of the flat was to be handed over on or before December 2015. The developer had filed occupancy certificate dated 16.03.2020. There is clear deficiency in service on the part of the developer.

12.     In a case of the Hon’ble Supreme Court DLF Home Developers Ltd. vs. Capital Greens Flat Buyers Assn., (2021) 5 SCC 537 decided on December 14, 2021, it was held as under:

“It is true that in the present case, the contractual rate of Rs.10 per square foot per month is double the rate fixed in the agreements in the above case. On the other hand, the court must be conscious of the fact that the situation in the real estate market in Delhi is very distinct from that in Bengaluru both in terms of rentals and land values. This has not been disputed. The flat buyers had to suffer on account of a substantial delay on the part of the appellants. In such a situation, they cannot be constrained to the compensation of Rs.10 per square foot provided by the agreements for flat purchase. However, having regard to all the facts and circumstances, we are of the view that the compensation on account of delay should be brought down from 7% to 6%. Moreover, the amount, if any, which has been paid in terms of the contractual rate shall be adjusted while computing the balance”

13.   In view of the above, we are of the opinion that the rate of interest at the rate of 6% per annum from the promised date of delivery till the date of occupancy certificate i.e. 16.03.2020 would be just and apt and reasonable. Therefore, the order dated 21.06.2018 of the State Commission is liable to be modified to this extent only.

14.     As such, the order dated 21.06.2018 of the State Commission is modified as under:

a. the developer shall pay compensation in the form of simple interest at the rate of 6% per annum from the promised date of possession i.e. 01.01.2016 till the date of occupancy certificate i.e. 16.03.2020 to the complainants, within a period of eight weeks from today, failing which, the interest at the rate of 9% per annum shall be paid.

15. .     The appeal is disposed of. Pending application, if any, stands disposed off.