Per Shri S.R. Khanzode, Hon’ble Presiding Judicial Member
This consumer complaint pertains to alleged deficiency in service on the part of the builder-opponent No.1-Anamika Real Estate Pvt. Ltd. and dealing person-Director-opponent No.2-Mr.Nitin Mehta (hereinafter opponent Nos.1&2 together are referred to as ‘builder’) for not handing over the flats agreed to be purchased by the complainants for consideration. Opponent No.3 is a co-operative Society of the flat purchasers of Benzer Tower in which the flats agreed to be purchased by the complainants are situated.
2. Undisputed facts are that complainants together agreed to purchase two flats bearing Nos.A-1102 & 1103 respectively having area of 450 sq.ft. and 590 sq.ft. situated in a building known as ‘Benzer Tower’ at Village Magothane, Borivali (East), Mumbai. On settling the terms on 10/05/1994, they paid `51,000/- and subsequently, on 01/03/1996 paid `4 Lakhs (`2 Lakhs for each one of the flat Nos.A-1102 & A-1103) as per demand of the builder and consequent to it two separate agreements dated 27/09/2002 were got executed; in respect of flat No.A-1102 in the name of complainant No.1-Mrs.Tanuja J. Shetty and in respect of flat No.A-1103 in the name of complainant No.2-Mrs.Mamta J. Shetty. The payments were duly acknowledged by the builder and by its two letters dated 03/01/2002 addressed to complainant No.1-Mrs.Tanuja Shetty, the builder acknowledged the fact of having received full payment of `5,48,750/- against flat No.A-1102 and of `6,55,000/- against flat No.A-1103 and also acknowledged that the balance amount of `25,000/- in respect of each one of the flats was payable at the time of possession.
3. Due to a Public Interest Litigation filed in the High Court, the entire project including the building of Benzer Tower was affected. There was stay of Brihanmumbai Municipal Corporation (‘BMC’ in short) over the construction activities in the month of November 2002 and which lasted till 06/03/2007 and as such complete construction activities become standstill and the construction could not be completed and as such there is no question of occupancy certificate ever been issued.
4. The builder by its letter dated 04/01/2006 referring to the clause Nos.11&12 of the agreements terminated the agreements dated 27/09/2002 and called upon the complainants to take refund of the amounts of `5,48,750/- and `6,55,000/- with simple interest @ 9% p.a. as per Maharashtra Ownership Flats (Regulations of the Promotion of Construction, Sale, Management and Transfer) Act, 1963. Taken by surprise by such communication, the complainants by their reply dated 17/01/2006 through their lawyer communicated to the builder about arbitrariness of their action of cancellation of the contract, further pointed out that referring to the clauses in question, they would not attract at all and further communicated to the builder that they had not made any grievance about delay in handing over the possession, the builder had no right to take unilateral decision to terminate the contracts and also communicated to the builder that they have not made any demand for refund and they want to continue with the contracts.
5. It is further revealed that in the meantime, the flat purchasers from the Benzer Tower formed an Association or in other words Proposed Society of such flat purchasers. Till then only 40% work of the building was over. As earlier pointed out, further construction was already stalled due to stay over the construction and development work of the entire project. With the arrangement with the builder, those flat purchasers, perhaps, had taken over the further construction work to themselves. The Society of the flat purchasers was got registered on 15/07/2006. The documents submitted for registration did include the names of the complainants as one of the purchasers of the flats.
6. It is further revealed that the Society by its letter dated 03/03/2006 refunded amount of `2,000/- each to both the complainants by cheque No.395669 dated 24/02/2006 for `2,000/- and which was drawn on HDFC Bank in favour of ‘Smita Shetty’ while cheque No.395670 dated 24/02/2006 for `2,000/- was drawn on HDFC Bank in favour of ‘Tanuja Shetty’. The complainants on the next day itself informed the Hon. Secretary of Benzer Tower Co-operative Housing Society (Proposed) that they cannot return the amount of membership fee deposited by them with the Society. There membership cannot be terminated at the sweet will of the proposed Society. Their action is malafide and indicated that it is an action taken by it after gloving hands with the builder and they categorically communicated that they want to continue with the membership.
7. It is further revealed that the opponents claimed that flats were sold to one Mr.Kamal K. Khabia and Smt.Saroj K. Khabia on 18/12/1997 and those purchasers are even admitted as members of opponent No.3-Society.
8. All these circumstances, ultimately, had driven the complainants to file this consumer complaint inter alia claiming relief of possession of the flats and in addition to it to pay `10 Lakhs towards mental and physical harassment suffered by them and costs of `50,000/- was also claimed.
9. The builder opposed the consumer complaint as per their written version dated 18/08/2010 while opponent No.3-Society filed their written version for the same purpose on 30/06/2010.
10. We heard both the parties.
On behalf of the complainants, they relied on the documents including agreements to which a reference is made earlier while recounting the facts and these documents, particularly, the agreements and other correspondence referred above are not in dispute. The builder relied upon the affidavit of Mr.Rohan Nitin Mehta. Obviously Mr.Rohan Mehta is speaking on the basis of record and his affidavit is nothing but the verification affidavit filed by the builder. Said affidavit does not specify which of the facts mentioned therein are true to his own knowledge and which he believed to be true on the basis of information received. It affects the probative value of the so called affidavit. A useful reference on the point can be made to decision of the Apex Court in the matter of A.K. Nambiar V/s. Union of India & Anr. AIR 1970 SC 652 .
11. From the clauses Nos.11 and 12 of the agreements, supra, to which builder referred in its termination letter dated 04/01/2006, it could be seen that clause No.11 speaks for handing over possession before May 1999 and it also stipulates that such commitment to hand over possession is subject to the circumstances which may not be in control of the builder and in these events the possession may be delayed. In the instant case, as admitted, from November 2002 to March 2007, the entire project was in a standstill position since there was an operating stay for further construction and development work and therefore, there arise no question to hand over the possession as stipulated by May 1999. The complainants themselves being fully aware of the circumstances, submitted in their reply dated 17/01/2006 that they have no grievance about delayed possession, even though they had parted with entire consideration except `25,000/- in respect of each of the flats which was payable at the time of receiving possession only. Therefore, clause No.11 has nothing to do, particularly, giving right to the builder to terminate the contract. Referring to clause No.12, it could be seen that right of termination in case of delayed possession is given to the purchasers, namely, complainants and not to the builder. Therefore, relying upon those clauses to terminate the contracts when no such circumstances arose or exists, rather, action of alleged termination of contracts on the part of builder is arbitrary, capricious, having no sanction of law and thus, has no legal effect of termination of the contracts.
12. There was a complaint made in the Police of the fraud practiced by the builder. In the information submitted to the Investigation Agency by the Registrar of the Co-operative Societies shows that the names of the complainants as purchasers of flat Nos.A-1102 and A-1103 were already communicated to the concerned authorities. The Registrar also informed to the Investigation Agency that it is the builder who is playing mischief since he had transferred the flats against the initial agreements. From the written version of the builder, it tried to shield himself saying that consequent to the termination of the contracts by its letter dated 04/01/2006, he had sold those two flats to Mr.Kamal K. Khabia and Smt. Saroj K. Khabia on 18/12/1997. The Society though initially accepted the complainants as their members and even received their membership fee, subsequently rescind from its commitment, tried to refund the membership fee and informing the complainants about alleged cancellation of their membership in the proposed Society. Such action on the part of the Society is also cannot be looked favourably. Under the circumstances, we find that the deficiency in service on the part of the builder not to hand over the possession of the flats, as agreed, is well established. We further find that to remove the deficiency, possession is to be handed over to the complainants, and it is for the builder to take necessary steps to secure possession of these flats and to hand over the same to the complainants. But, by introduction of subsequent purchasers, it may not be possible now for the builder to hand over the possession. In those circumstances, by way of alternate relief, the complainants need to be suitably compensated for said deficiency in service on the part of builder in terms of Section 14(1)(d) of Consumer Protection Act, 1986 (‘the Act’ for brevity). The complainants, who are not at fault, should not suffer. The flats which they intend to occupy for their residence, now if they had to search for any new flats, they will have to pay as per the current market rate. Thus, while fixing the quantum of compensation, the prevailing market rate at Borivali (East), need to be taken into consideration. There is no evidence as such made available by both the parties, but we can take due notice of the information relating to the prevailing market rates published in the prestigious newspaper like ‘Times of India’, in its Saturday Property Supplement and in its Issue dated 21/01/2012, the market rate for Borivali (East) for the flat per sq.ft. is quoted in between the range `9,500/- to `10,800/-. In the Daily ‘Loksatta’, Marathi newspaper in their ‘Vasturang’ dated 21/01/2012 these rates are quoted as falling in a range `8,000/- to `12,000/-. Considering this information and since the complainants need to be compensated, we further find that while fixing the compensation, the criteria of prevailing market rate would be relevant. We hold accordingly and pass the following order :-
-: ORDER :-
1. Complaint is partly allowed.
2. Opponent No.1-Anamika Real Estate Pvt. Ltd. and opponent No.2-Mr.Nitin N. Mehta, jointly and severally held liable and directed to hand over vacant and peaceful possession of disputed flat Nos.1102 & 1103 of ‘A’ wing from Benzer Tower (of which opponent No.3-Society is formed) and at the time of receipt of the possession, the complainants shall pay balance of consideration of `25,000/- for each flat i.e. total `50,000/- to opponent Nos.1&2 or their nominees.
ALTERNATIVELY
Opponent No.1-Anamika Real Estate Pvt. Ltd. and opponent No.2- Mr.Nitin N. Mehta, jointly and severally held liable and directed to pay compensation of `83,20,000/- (Rupees Eighty Three Lakhs Twenty Thousand only) to the complainants. This compensation be paid within 45 days from today and failing which, it shall carry further interest @ 18% p.a. till its realization.
3. Opponents to bear their own costs and Opponent No.1-Anamika Real Estate Pvt. Ltd. and opponent No.2- Mr.Nitin N. Mehta, shall jointly and severally pay `25,000/- as costs to the complainants.
4. Copies of the order be furnished to the parties.
Pronounced
Dated 25th January 2012.
