Delhi

StateCommission

CC/546/2014

MR. BALKESHWAR SHARMA - Complainant(s)

Versus

THE M.D. M/S ANSAL HOUSING & CONSTRUCTION LTD. - Opp.Party(s)

10 Feb 2020

ORDER

IN THE STATE COMMISSION : DELHI

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

Date of Arguments : 10.02.2020

Date of Decision : 24.02.2020

Complaint No.546/2014

 

In the matter of :-

 

Mr. Balkeshwar Sharma,

S/o Sh. M.S. Sharma,

R/o WZ-227/D/2,

Shaheed Chand Marg,

Canara Bank Road, Uttam Nagar,

New Delhi-110059.                                                                     ….........Complainant

 

Versus

 

The Manager,

M/s. Ansal Housing & Construction Ltd.,

15, USF, Indira Prakash Building, 21,

Barakhamba Road,

New Delhi-110001.                                                …..........Opp. Party

                                                                

CORAM

 

Sh. O. P. Gupta, Member (Judicial)

 

1.     Whether reporters of local newspaper be allowed to see the judgment?                                       Yes/No

2.      To be referred to the reporter or not?                                                                                                     Yes/No

 

Sh. O.P. Gupta, Member (Judicial)

Judgement

1. The case of the complainant is that he was approached by the employees and agents of OP who offered residential accommodation at Ansal Heights 86, Sector-86, Gurgaon which was  spacious having all modern amenities. It was represented that land was free of all encumbrances and had all clearances vis-à-vis the user thereof. All permissions and clearances for construction had been obtained.  The complainant felt that his saving and other investments would not be able to match the requisite purchase and consideration and he would have to get financial assistance from the bank.  The OP assured that finance would not be an issue and all papers necessary for obtaining loan from bank would be provided by OP.  Complainant agreed to purchase a 3 BHK Apartment No.E-306 admeasuring 1690 sq. ft. in the project of OP.  Total sale consideration was Rs.71.50 lacs.  He paid initial amount of Rs.6 lacs vide cheque dated 27.04.2012.  He further paid Rs.6 lacs vide cheque dated 16.07.2012, another amount of Rs.6 lacs vide cheque dated 16.03.2013.  He made total payment of Rs.18 lacs. He approached OP for arranging finance with bank involved in the project.  There was a sudden and complete lack of response from the OP. OP did not respond. Complainant himself started exploring possibilities of financial assistance from bank and requested OP to provide requisite documents demanded by the bank for approving the finance. It was found that no bank was ready to provide loan facility as requisite documents relating to the land user, clearances were not provided by the OP.  He came to now only HDFC  Bank and no other bank was ready to finance the project.  It came to the notice of the complainant that even the residential user of the land is not approved by the concerned authorities. He asked the OP to refund the money with interest.

 

2. In order to pre-empt the legal action which could be taken by the complainant and usurp the money, OP took illegal, arbitrary and unjustified act of cancelling the allotment vide letter dated 20.05.2014.  The complainant sent legal notice dated 13.08.2014.  Action of the OP taking is illegal and grossly arbitrary. Hence, this complaint for declaring cancellation to be null and void, directing OP to refund Rs.18 lacs with interest @18% per annum, directing OP to pay compensation for mental agony and harassment to the tune of Rs.10 lacs and also cost of litigation.

 

3. The complainant moved an application dated 10.04.2015 seeking permission to encash the cheque for Rs.6,04,950.30 issued by the OP.  The same was allowed by this Commission vide order dated 21.05.2015, without prejudice to the right and contentions of the parties.

 

4. The OP filed WS pleading that complaint has been filed with sole purpose of harassing and pressuring the OP to submit to his unreasonable and mischievous demands. It took preliminary objections that complaint is not maintainable as there is no tenable cause of action. The complainant has not suffered any mental or physical or financial loss or inconvenience due to any act or omission of the OP.  The complainant raises certain intricate questions of facts and law and the same can be determined only after leading detailed technical evidence and cross-examination. This Commission is not proper forum for adjudication of said dispute.  Same has to be referred to Civil Court. The complainant has been in breach of terms and conditions of allotment inasmuch as the complainant has failed to pay the due and payable amount. Consequently the OP cancelled the allotment and refunded the amount paid by the complainant after deduction of earnest money.  There is no deficiency in service.  This Commission has no pecuniary and territorial jurisdiction. The complaint is barred by limitation.

 

5. On merits the OP denied that it adopted any unfair trade practice. It denied that complainant is a consumer within the meaning of Consumer Protection Act. The complainant represented that he has sufficient resources to purchase the unit. He applied for purchasing the unit on terms and condition agreed between the parties including timely payment of instalment. It denied that it made any representation as alleged or otherwise. It denied that it represented to complainant that it would arrange for the finance for the complainant.  Payments by the complainant were not denied.  It denied having received mail dated 08.09.2013, 14.05.2014, 19.05.2014, 22.05.2014, 29.05.2014, 03.06.2014 and 19.06.2014.  Upon cancellation of allotment on 20.05.2014 due to breach of obligation by the complainant, it refunded the amount after deducting the earnest money.  Cancellation was affected after giving due opportunity to the complainant to make the payment of the due and payable amount.

 

6. Complainant has filed rejoinder and his own affidavit in evidence. OP filed affidavit of Remya Rajan, AR. Both parties filed written arguments.

 

7. I have gone through the material on record and heard the arguments. Counsel for complainant filed compilation of judgement dated 21.08.2019.  OP also filed copies of three judgement on 10.02.2020.

 

8. Counsel for complainant relied upon the judgement of Hon’ble Supreme Court in Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Reghavan, 2019 SCC Online SC458.  In that case the flat buyer was not interested in taking possession due to delay in completion and obtaining Occupancy Certificate. Hon’ble Supreme Court affirmed finding of National Commission that clause relied upon by the builder were wholly one sided, unfair and unreasonable and same could not be relied upon.  It was held that terms could not be 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.

 

9. Reliance has also been placed on behalf of complainant on decision of Hon’ble Supreme Court in Lucknow Development Authority Vs. M.M. Gupta (1994) 1 SCC 243.  It was held in the said case if service is defective or it is not what was represented, then it would be unfair trade practice.

 

10. Yet another reliance by the complainant is on decision of Hon’ble Supreme Court in Bangalore Development Authority Vs. Syndicate bank (2007) 6 SCC 711.  It was held in the said case that in case of delay in delivery in possession, the complainant is entitled to interest as per principle laid down in Balbir Singh case (2004) 5 SCC65.  I feel that none of these applicable in the present case.  The reason being that neither the complainant is seeking possession nor there is question of any interest or rate of interest.

 

11. Last reliance by complainant was on decision of Hon’ble Supreme Court in Fortune Infrastructure Vs.Trevor D’ Lima (2018) 5 SCC 442. The question in the said case was that what should be criteria for damages in case of non delivery of flat. It was held that damages for loss arising in respect of non delivery of flat, reckoning date being  at time of breach but court can deviate.

 

12. On the other hand, counsel for OP pointed out that in this case the question is whether OP was justified in cancelling the allotment due to non payment of instalment by the complainant.  In this regard he relied upon the decision of National Commission in DLF Ltd. Vs. Bhagwanti Narula II (2015) CPJ 319.  Clause 8 of the agreement in the said case provided that allottee  agreed that amount paid on registration to the extent of 20% of the sale price, and on allotment or in instalment, as the case may be, will collectively constitute the earnest money. The complainant argued that amount of Rs.63,469/- paid at the time of booking can be said to be earnest money and only that amount could be forfeited. The National Commission held that in its opinion 20% of the sale price could not be said to be reasonable amount which OP could have forfeited on account of default on the part of complainant unless it can show that it had suffered loss to that extent.   In the opinion of National Commission forfeiture exceeding 10% of the sale price could not be said to be a reasonable amount.

 

13. OP also relied upon the decision of National Commission in RP No.1974/14 titled as DLF Southern Towns Pvt. Lt. Vs. T.P. Balachandra Panicker decided on 07.01.2015.  The said decision is based on earlier decision of National Commission in Sahara India Commercial Corpn. Ltd. Vs. P. Gajendra Chary III (2010) CPJ 190.  That decision in turn is based by the decision of Hon’ble Supreme Court in HUDA Vs. Kewal Kishan.  In that case Hon’ble Supreme Court held that applicant would be entitled to forfeit the amount by way of instalment in a case where allottee defaults in making the payment of the remaining instalment. It went on to say that applicant would be fully justified in forfeiting the earnest money deposited by the allottee. In DLF Southern Towns Pvt. Ltd., revision of the builder was allowed and complaint was dismissed.

 

14. Counsel for OP also referred to decision of National Commission in RP No.624/07 titled as Sahara India Commercial Corpn. Ltd. Vs. C. Madhu Babu .  Reliance was also placed on decision of Hon’ble Apex Court in Parshant Kumar Shahi Vs. Ghaziabad Development Authority (2000) 45 SCC 120.

 

15. In the instant case, the OP forfeited Rs.11,95,049.70 which is 20% of the basic cost of Rs.59,75,248.50 vide letter dated 12.03.2015.  This is how it refunded Rs.6,04,950.30.

 

16. The complainant has admittedly committed default in payment of instalment. Its plea that OP did not help in arranging finance cannot be sustained because OP is under no obligation to do so. The allottee had to arrange the finance himself.

 

17. Anyhow relying upon the decision of National Commission in DLF Vs. Bhagwanti (supra)  I am of the view that forfeiture to the extent of 20% is not lawful. The OP could forfeit only 10% of the basic price. Consequently the OP is directed to refund Rs.5,97,525/- with interest @9% per annum from the date of cancellation i.e. 12.03.2015 till date of refund.  The payment should be made within 30 days from the date of order.

 

18. Copy of the order be sent to both the parties free of cost.

 

19. File be consigned to Record Room.

 

(O.P. Gupta)

Member (Judicial)

Bench-2

                              

245.