Chandigarh

StateCommission

CC/52/2022

Col. Aman Katoch - Complainant(s)

Versus

Sushma Buildtech Ltd. - Opp.Party(s)

Naveen Sheokand & Kriteka Sheokand Adv.

31 Jan 2023

ORDER

 STATE CONSUMER DISPUTES REDRESSAL COMMISSION, U.T. CHANDIGARH

[Addl. Bench]

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

Consumer Complaint No.	:	CC/52/2022
Date  of  Institution	:	15/06/2022
Date   of   Decision	:	31/01/2023

 

 

 

 

 

1]    Col. Aman Katoch S/o Brg. K.C. Katoch;

2]    Gitanjali Katoch W/o Col. Aman Katoch;

 

Both Resident of PUSHP Cottage, Ram Nagar Colony, Thakur Dwara, Near Maranda, Tehsil Palampur, District Kangra (H.P).

 

…. Complainants

 

Vs.

 

 

1]     M/s Sushma Buildtech Limited, Unit No.B-107, Business Complex at Elante Mall, 1^st Floor, Industrial Area, Phase-I, Chandigarh, through its Wholetime Director Sh. Bharat Mittal.

2]     Binder Pal Mittal, Managing Director of M/s Sushma Buildtech Limited, Resident of House No. 233, Sector 7, Panchkula – 133001.

3]     State Bank of India, Plot No. 1-2, City Centre, Sector 5, Panchkula – 134109, through its Manager.

4]     TATA Capital Housing Finance Limited, 2^nd Floor, SCO 20, Sector 26, Madhya Marg, Chandigarh – 160019, through its Manager/ Auth. Signatory. [Name of Opposite Party No.4 deleted and Complaint against Opposite Party No.4 dismissed vide Order dated 20.09.2022]

 

…… Opposite Parties

 

BEFORE: PADMA PANDEY             PRESIDING MEMBER

                PREETINDER SINGH     MEMBER

 

PRESENT	:	Sh. Naveen Sheokand, Advocate for Complainants.
	:	Sh. Vishal Singal, Advocate for Opposite Parties No.1 & 2.
	:	Sh. Varun Chawla, Advocate for Opposite Party No.3.
	:	Name of Opposite Party No.4 deleted and Complaint against Opposite Party No.4 dismissed vide Order dated 20.09.2022.

 

PER PADMA PANDEY, PRESIDING MEMBER

 

 

 

 

                In brief, it is the case of the complainants that despite making payment of ₹87,18,970/- to the opposite parties, towards purchase of Unit bearing no.B-1502, measuring 1970 square feet, 15^th Floor, Tower No. B, in their project named ‘Sushma Chandigarh Grande’, at Village Bishangarh & Bishanpura, MC, Zirakpur, Tehsil Zirakpur, District SAS Nagar, Mohali, Punjab (in short the unit), yet, possession thereof has not been delivered by the promised date (16.12.2018) i.e. within a period of 36 months as envisaged in Clause 14(d) of the agreement dated 17.12.2015, Annexure C-2 or within extended period of 6 months i.e. latest by 15.06.2019, for want of construction and development activities. Various requests made by the complainants in the matter did not yield any result. Also, the persistent requests of the Complainants fell on the deaf ears of the Opposite Parties, as they illegally sought to adjust the issue of delayed possession penalty against interest of delay in instalments to the tune of ₹6,89,454/-, which according to the complainants was not payable by them since the entire payments were directly transferred under the subvention scheme from Tata Capital Housing Finance Limited to Opposite Party No.1. Alleging that the aforesaid acts amount to deficiency in service and unfair trade practice on the part of the Opposite Parties, the Complainants have preferred the instant Consumer Complaint.

 

2.         Notice of the complaint was sent to Opposite Parties seeking their version of the case. However, vide order dated 20.09.2022 the name of Opposite Party No.4 (Tata Capital Housing Finance Limited) was ordered to be deleted from the array of the parties and the Complaint qua it was dismissed.

 

3.         Opposite Parties No.1 & 2 contested the claim of the Complainants on numerous grounds, inter alia, that in the face of arbitration clause contained in the agreement, this consumer complaint is not maintainable; that this Commission did not vest with pecuniary and territorial jurisdiction; that the complainants being speculators did not fall within the definition of consumer; that the period of possession contained in the agreement clearly says that it was only proposed that possession will be delivered within a maximum period of 36 months from the date of execution of agreement plus 6 months grace period; that for any delay in offering possession, interests of the complainants were safeguarded by way of penalty clause contained in the agreement; that the complainants were defaulters in making payment towards price of the said unit; that the alleged settlement agreement has not been executed between the parties, therefore, the Complainants are bound by the Agreement dated 17.12.2015;  that the project is complete in all respects. Pleading that there was no deficiency in service or unfair trade practice on their part, a prayer has been made for dismissal of the complaint.

 

4.         Opposite Party No.3 filed its written statement. While admitting the basic facts of the case, it has raised a plea that no cause of action has arisen in favour of the Complainants against it (Opposite Party No.3) as no allegation has been made against it and Opposite Party No.3 has been dragged into unnecessary litigation. Pleading that there was no deficiency in service or unfair trade practice on its part, Opposite Party No.3 has prayed for dismissal of the complaint.

 

5.         Parties led evidence by way of affidavits and documents.

 

6.         We have heard the learned counsel for the contesting parties and gone through the record of the case, including the written arguments advanced.

 

7.         After scanning of record, including written arguments, our findings are as under:-

 

8.         Before going into the merits of the case, it is significant to mention here that during pendency of this complaint, possession of the unit in question was offered to the complainants, on  03.12.2022, which was duly received by them.

 

9.         Now we will deal with the objection taken by the opposite parties to the effect that in the face of existence of Arbitration clause in the agreement, jurisdiction of this Commission is barred; it may be stated here that this issue has already been dealt with by the larger Bench of the Hon’ble National Commission in a case titled as “Aftab Singh  Vs. Emaar MGF Land Limited & Anr.”, Consumer Case No. 701 of 2015, wherein, vide order dated 13.07.2017, it has been held that an Arbitration Clause in the Agreements between the buyer and the Builder cannot circumscribe the jurisdiction of a Consumer Fora notwithstanding the amendments made to Section 8 of the Arbitration Act. Feeling aggrieved against the said findings, the builder filed Civil Appeal bearing No.23512-23513 of 2017 before the Hon’ble Supreme Court of India, which was dismissed vide order dated 13.02.2018. Even the Review Petition (C) Nos. 2629-2630 of 2018 filed by the builder in Civil Appeal Nos.23512-23513 of 2017 against order dated 13.02.2018, was dismissed by the Hon’ble Supreme Court of India, vide order dated 10.12.2018. As such, objection taken in this regard stands rejected.

 

10.         As far as objection taken to the effect that the complainants did not fall within the definition of ‘consumer’, it may be stated here that the objection raised is not supported by any documentary evidence and as such the onus shifts to the opposite parties to establish that the complainants have purchased the unit in question to indulge in ‘purchase and sale of units’ as was held by the Hon’ble National  Commission in “Kavit Ahuja vs. Shipra Estates” I (2016) CPJ 31 but since they failed to discharge their onus, hence we hold that the complainants are consumers as defined under the Act. The mere fact that the complainants are residing at Kangra (H.P) or they have another house there or anywhere else, is not a ground to shove them out of the definition of consumer. Such an objection taken by the opposite parties, therefore, being devoid of merit is rejected.

 

11.         Now, we will like to deal with the objection raised by the opposite parties that for want of pecuniary jurisdiction, it is not open to this Commission to entertain and adjudicate this complaint; it may be stated here that this Complaint has been filed under the provisions of CPA 2019. In exercise of powers conferred by provisos to sub-section (1) of Section 34, sub-clause (i) of clause (a) of sub-section (1) of section 47 and sub-clause (i) of clause (a) of sub-section (1) of section 58 read with sub-clauses (o), (x) and (zc) of sub-section (2) of section 101 of the Consumer Protection Act, 2019, the Central Government has notified the Consumer Protection (Jurisdiction of the District Commission, the State Commission and the National Commission) Rules, 2021, to the effect that the State Commission shall have jurisdiction to entertain the complaints where the value of the goods or services paid as consideration exceeds fifty lacs but does not exceed rupees two crore.  As such, in the present case, since against total value of the unit, in question, the complainants have paid ₹87,18,970/- to the opposite parties,  in the manner explained above, which exceeds fifty lacs but does not exceed rupees two crore respectively, as such, this Commission has pecuniary Jurisdiction to entertain and decide the present Complaint. Objection taken by the opposite parties in this regard stands rejected.

 

12.         There is no dispute with regard to the fact that the complainants purchased the unit in question, in the said project of the opposite parties, for which, they had already paid an amount of ₹87,18,970/-, yet, possession thereof had not been delivered by 16.12.2018 i.e. within a period of 36 months as envisaged in Clause 14 (d) of the agreement dated 17.12.2015, Annexure C-2 or within extended period of 6 months i.e. latest by 15.06.2019. However, there is nothing on record that the Opposite Parties paid any amount of compensation to the complainants, for the delay being caused in delivery of possession of the unit in question.

 

13.         Admittedly, in the present case, possession of the unit has been offered during pendency of this complaint, on 03.12.2022 i.e. after a delay of more than 3 years of the committed date (15.06.2019).  Counsel for the opposite parties failed to apprise this Commission, as to why such a huge delay took place in offering possession of the unit to the complainants. Not even a single document has been placed on record, wherefrom this Commission could be convinced that the delay caused was on account of some force majeure circumstances, having been faced by the opposite parties.

 

14.         From the peculiar circumstances of this case, it has been proved that the opposite parties made false representations, which were materially incorrect and were made in such a way that the complainants, to whom it was made, were entitled to rely upon it and they may act in reliance on it. The complainants are thereby involved in a disadvantageous contract with the opposite parties and suffered financial loss, mental agony and physical harassment. Representations/statements made at that time were believed to be true. All the facts established that from the very inception there was intent to induce the complainants to enter into a contract by way of signing agreement and also intent to deceive them, which act amounts to grave deficiency in providing service, negligence and adoption of unfair trade practice on the part of the opposite parties.

 

15.         It may be stated here that it is well settled law that non-delivery of possession of plots/units in a developed project by the promised date is a material violation on the part of a builder. Thus, irrespective of the fact that the unit in question was complete in all respects or not, when possession was offered on 03.12.2022, the fact remains that there was an inordinate delay of more than 3 years in offering the same.

 

16.         Furthermore, the opposite parties also cannot wriggle out of their liability, by saying that delay took place on account of the reason that the complainants defaulted in making payments, in view of principle of law laid down by the Hon’ble Supreme Court of India in “Haryana Urban Development Authority Vs. Mrs. Raj Mehta”, Appeal (Civil) 5882 of 2002, decided on 24.09.2004, wherein it was held that if the builder is at fault in not delivering possession of the units/plots by the stipulated date or within a reasonable period where no agreement is executed, it cannot expect the allottee(s) to go on paying installments to it. 

 

17.         Record shows that the Opposite Parties has imposed ₹6,13,010/- as interest @ 24% on delayed installments, which prima-facie seems to be unjustified as there is a Tripartite Agreement between the parties and as per the said agreement Opposite Party No.3 has to transfer the amount demanded by them directly to Opposite Party No.1 and there is no role of Complainants in whatsoever demand and payments. It is a matter of record that being in dire need of home, since the Complainants had paid the said amount, hence to our mind, this issue is of no legal significance.     

 

18.         Now we are adverting to the vital question that falls for consideration as to what amount of compensation should be granted to the complainants for the period of delay in delivery of possession, starting from 15.06.2019. It may be stated here that failure of the Opposite Parties to provide complete/effective possession of the unit within the stipulated period amounts to deficiency in service, as the possession offered on 03.12.2022 (during the pendency of the present proceedings) i.e. after a considerable delay of more than 3 years. It is also matter of common parlance that for purchasing the plot, the purchasers take loans from their family members, relatives and friends or financial institutions. In some cases, the purchasers live on rent in the absence of timely delivery of possession. On account of delay in actual delivery of possession within the stipulated period (in the present case by 15.06.2019), the complainants suffered mental agony, hardship and financial loss at the hands of the developers/builders. In the case titled as “Lucknow Development Authority v. M K Gupta” (1994) 1 SCC 243, the Hon’ble Supreme Court discussed about the extent of the jurisdiction of the Consumer Fora to award just and reasonable compensation for the harassment and agony suffered by a consumer. Recently in Civil Appeal No.6239 of 2019 (Wg. Cdr. Arifur Rahman Khan and Aleya Sultana and Ors. v. DLF Southern Homes Pvt. Ltd. (now Known as BEGUR OMR Homes Pvt. Ltd. and Ors.) decided on 24.08.2020, while discussing the above authorities and discarding the one-sided terms of the Buyer’s Agreements, the Hon’ble Supreme Court awarded simple interest @6% per annum on the amount deposited by the complainants therein, in addition to the penalty amount, as prescribed in the agreement for delay in delivery of possession till delivery of actual and physical possession of the unit.

 

19.         In view of the observations of the Hon’ble Supreme Court in the above noted case, we are of the view that the provision of penalty @ ₹5/- per sq. ft. per month of the super built up area of the said unit as per Clause 14(d) of the Apartment Buyer’s Agreement, Annexure C-2, is not sufficient to compensate the complainants for the delay in delivery of possession and the mental agony, harassment and financial loss suffered by the complainants on account of this reason. Therefore, in addition to aforesaid penalty @ ₹5/- per sq. ft. per month of the super built up area of the said unit, after the expiry of stipulated date of delivery of possession i.e. 15.06.2019 till the date of actual, physical and legal delivery of possession, the complainants are also entitled to simple interest on the entire amount deposited by them @ 6% per annum from 15.06.2019 till delivery of possession of the unit in the manner, as discussed above. 

 

20.         For the reasons recorded above, this complaint is partly accepted with cost and the Opposite Parties are, jointly & several, directed as under:-

 

1. To pay compensation @ ₹5/- per sq. ft. per month of the super built up area of the said unit, as per clause 14(d) of the Apartment Buyer’s Agreement, Annexure C-2 and also interest @6% p.a. on the entire deposited amount, starting 15.06.2019 till 03.12.2022 (i.e. date of actual, physical and legal delivery of possession to the Complainants), within a period of 30 days from the date of receipt of a certified copy of this order, failing which the entire accumulated amount shall carry penal interest @9% p.a. from the date of default till this payment is made.

 

2. Pay compensation in the sum of ₹1,00,000/- to the complainants for causing them mental agony and physical harassment; deficiency in providing service & adoption of unfair trade practice and also cost of litigation to the tune of ₹33,000/-, within a period of 30 days from the date of receipt of a certified copy of this order, failing which, the said amounts shall carry interest @9% p.a. from the date of default till realization.

 

21.         The complaint against Opposite Party No.3 fails and is accordingly dismissed with no order as to costs. 

 

22.         In view of the present Consumer Complaint being partly allowed, the pending application(s), if any, stand disposed off in terms of the aforesaid order.

 

23.         Certified copies of this order, be sent to the parties, free of charge.

 

24.         The file be consigned to Record Room, after completion.

Pronounced

31^st January, 2023                                                             

Sd/-

                                                        (PADMA PANDEY)

PRESIDING MEMBER

 

 

Sd/-

                                                        (PREETINDER SINGH)

MEMBER

 

“Dutt”