DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION ERNAKULAM
Dated this the 18th day of August 2023.
Filed on: 19/08/2020
PRESENT
Shri.D.B.Binu President
Shri.V.Ramachandran Member Smt.Sreevidhia.T.N Member
C.C. No 224/2020
COMPLAINANT
Mrs.Swapna Joseph, W/o.Justin K.Thomas, Kuttikkattu House,
Kurichi P.O., Kottayam, Pin-686 549.
(Rep. by Adv. George Cherian Karipparambil, Karipparambil Associates, H.B.48, Panampilly Nagar, Kochi 682 036)
VS
OPPOSITE PARTIES
1) M/s.Asten Properties and Developers Pvt. Ltd., 3rd Floor, Compass, N.H.Byepass, Thammanam P.O., Ernakulam, Pin-682 032. Rep. by its Authorised Officer and Director Mr.Siraj Mather, S/o.K.M.Abdul Rahman Mather.
2) Mr.Siraj Mather, S/o.K.M Abdul Rahman Mather, Authorised Officer and Director, M/s.Asten Properties and Developers Pvt. Ltd., 3rd Floor, Compass, NH Byepass, Thammanam P.O., Ernakulam, Pin-682 032
(o.ps rep. by Adv.Praveen K. Joy, Adv.Abhilash N., M/s.Joy & Joy Associates, 2nd Floor, Empire Building, Near Kerala High Court, Ernakulam, Kochi-682 018)
F I N A L O R D E R
D.B. Binu, President.
- A brief statement of facts of this complaint is as stated below:
The complaint filed under Section 35 of the Consumer Protection Act, 2019 alleges negligence, deficiency in service, and unfair trade practices by the opposite parties. The complainant, who had permanent residence in a different location, desired to settle in Kanjirappally, Kerala, and was attracted to the Asten Dew Dale apartment project advertised by the opposite parties. The project promised various amenities and was developed by Asten Realtors, a reputed real estate group. The complainant entered into agreements for sale and construction with the opposite parties in July 2012, followed by a revised agreement in December 2015. The construction agreement stated that the apartment would be delivered within 30 months from the specified date.
However, the complainant discovered in March 2017 that no construction activities were taking place at the project site. Despite repeated requests, the opposite parties failed to resume construction or provide a revised schedule. The complainant sent a lawyer's notice in June 2019, demanding a refund of the amount paid with interest and compensation. The opposite parties admitted the delay but promised to complete the construction in a revised schedule, which they failed to communicate. With no construction progress and no intention from the opposite parties to complete the project, the complainant suffered mental agony and hardship.
The complaint seeks a refund of the amount paid with interest, compensation for damages amounting to Rs. 65,45,313, and additional compensation of Rs. 1,30,90,735 for loss and damages sustained due to negligence, deficiency in service, and unfair trade practices. The complainant also requests the commission to award costs of the proceedings and any other necessary orders in the interest of justice.
2) Notice
The notices sent to the opposite parties have been successfully served, but they have failed to file their versions in response. As a result, the opposite parties are set ex parte.
3) Evidence
The complainant had filed a proof affidavit and six documents that were marked as Exhibits-A-1- to A-6.
Exhibit A1: Land agreement dated 02.12.2015 between the complainant and the opposite party.
Exhibit A2: Construction agreement dated 02.12.2015 between the complainant and the opposite party.
Exhibit A3: Account statement of the complainant with Federal Bank, Kurichi branch, covering the period from 01.05.2012 to 09.02.2017, providing evidence of payment of Rs. 65,45,313/- Exhibit A4: Office copy of the lawyer notice dated 14.06.2019 sent by the complainant to the opposite parties.
Exhibit A5: Postal receipt Nos. RL 645970704IN and RL 645970823IN, both dated 14.06.2019.
Exhibit A6: Reply letter dated 19.06.2019 issued by the opposite parties.
4) The main points to be analysed in this case are as follows:
i) Whether the complaint is maintainable or not?
ii) Whether there is any deficiency in service or unfair trade practice from the side of the opposite party to the complainant?
iii) If so, whether the complainant is entitled to get any relief from the side of the opposite party?
iv) Costs of the proceedings if any?
5) The issues mentioned above are considered together and are answered as follows:
In the present case in hand, as per Section 2(7) of the Consumer Protection Act, 2019, a consumer is a person who buys any goods or hires or avails of any services for a consideration that has been paid or promised or partly paid and partly promised, or under any system of deferred payment. The complainant produced a copy of the Account statement of the complainant with Federal Bank, Kurichi branch, covering the period from 01.05.2012 to 09.02.2017, providing evidence of payment of Rs. 65,45,313/- (Exhibit A-3). Hence, the complainant is a consumer as defined under the Consumer Protection Act, 2019.
The complainant has filed a complaint against the opposite parties, alleging deficiency in services due to the delay in the delivery of the apartment.
The learned counsel for the complainant submitted that the complainant entered into an agreement for sale and an agreement for construction with the first opposite party, a construction company, and the second opposite party, an authorized officer and director. The complainant was attracted by the advertisements for the Asten Dew Dale apartment project and entered into these agreements in July 2012. However, the project underwent revisions and rescheduling. On 02.12.2015, the complainant entered into a fresh agreement for sale, purchasing a specific interest in the land. A construction agreement was also signed on the same date for the construction of Apartment No. 6C in the Dew Dale complex. The construction agreement stipulated a completion and possession deadline of 30 months from 02.12.2015. The complainant made installment payments totaling Rs. 65,45,313/- based on the promise of timely delivery by 02.06.2018.
In March 2017, the complainant discovered that no construction activities were taking place at the project site. Despite repeated requests, the opposite parties failed to resume construction. The complainant demanded liquidated damages as stipulated in the construction agreement for the delay in delivering Apartment No. 6C. The opposite parties made partial payments of Rs. 30,000/- per month until April 2019. In response to a lawyer's notice sent by the complainant on 14.06.2019, the opposite parties admitted the delay, apologized, and promised completion in a revised work schedule. However, no revised schedule was communicated, and no construction activities have taken place at the project site since March 2017.
As a result of unfair trade practices, negligence, and deficiency in service on the part of the opposite parties, the complainant filed a consumer complaint seeking a refund of Rs. 65,45,313/- with 18% interest from the respective payment dates. The opposite parties have not filed a version and are ex parte. The complainant filed a proof affidavit and exhibits A1 to A6, which include the sale agreement, construction agreement, account statement, lawyer notice, postal receipt, and the opposite parties' reply letter. These exhibits establish the consumer relationship between the complainant and the opposite parties.
The only contention raised by the opposite parties is the existence of an arbitration clause in the agreement, which they argue should dismiss the consumer complaint. However, the complainant argues that the jurisdiction of the Consumer Commission is not barred by the arbitration clause, as settled by the decisions of the Hon'ble Supreme Court of India and the Honrable National Commission.
The opposite parties’ conscious failure to file their written version in spite of having received the Commission’s notice to that effect amounts to an admission of the allegations leveled against them. Here, the case of the complainant stands unchallenged by the opposite parties. We have no reason to disbelieve the words of the complainant against the opposite parties. The Hon’ble National Commission held a similar stance in its order dated 2017 (4) CPR page 590 (NC).
The opposite party's inadequate service caused a deficiency, negligence, and failure to meet the complainant's expectations. This resulted in the complainant's mental agony, hardship, and financial loss. These actions demonstrate the opposite party's callousness, negligence, and poor service quality, making them fully responsible.
In the present case, the complainant has successfully established that they are a consumer as defined under the Consumer Protection Act, 2019, by providing evidence of payments made to the opposite parties. The complainant entered into agreements for sale and construction with the opposite parties based on the advertisements of the Asten Dew Dale apartment project. However, the opposite parties failed to fulfill their obligations and deliver the apartment within the specified time frame.
Despite the complainant's repeated requests, the opposite parties did not resume construction activities or provide a revised schedule. The complainant issued a lawyer's notice, to which the opposite parties admitted the delay but failed to provide a concrete plan for completion. It is evident that the opposite parties engaged in unfair trade practices, negligence, and deficiency in service, causing mental agony, hardship, and financial loss to the complainant.
The exhibits presented by the complainant, including the sale agreement, construction agreement, account statement, lawyer notice, postal receipt, and the opposite parties' reply letter, establish the consumer relationship and the failure of the opposite parties to fulfill their obligations. The opposite parties, despite being served notice, have failed to file their versions, thereby admitting the allegations against them.
In similar cases, the Hon'ble Supreme Court of India and the National Consumer Commission have ruled that the existence of an arbitration clause does not bar the jurisdiction of the Consumer Commission. The contention raised by the opposite parties regarding the arbitration clause does not hold ground and cannot dismiss the consumer complaint.
Considering the above observations and the evidence presented, it is clear that the complainant has suffered due to the negligence and deficiency in service on the part of the opposite parties.
In the case of National Seeds Corporation Limited v. M. Madhusudhan Reddy and Anr. (2012) 2 SCC 506, the Hon'ble Supreme Court concluded that arbitration is not the sole remedy available to a grower. Instead, it is an optional remedy. The grower has the choice to either seek arbitration or file a complaint under the Consumer Protection Act. If the grower decides to pursue arbitration, it may prevent them from subsequently filing a complaint under the Consumer Protection Act. However, if the grower initially chooses to file a complaint before the appropriate Consumer Forum, they cannot be denied relief by invoking Section 8 of the Arbitration and Conciliation Act, 1996.
This order is issued in light of the complainant's consumer rights and the legal responsibilities of the opposite parties. It has been determined that the opposite parties have failed to meet their obligations and have provided inadequate service, thereby justifying the need for appropriate remedies to be granted to the complainant.
We hope this decision to hold the opposite parties accountable for their unfair practices and deficient service aims to ensure justice and act as a deterrent against future irresponsible behavior. It calls on all stakeholders, including regulatory bodies, government agencies, developers, and consumers, to work together for a more responsible real estate sector. By enforcing regulations and promoting transparency, stakeholders can protect consumer interests and rebuild trust in the apartment project industry.
We find the issue Nos. (II) to (IV) are found in favour of the complainant for the serious deficiency in service that happened on the side of the opposite parties. Naturally, the complainant had suffered a lot of inconvenience, mental agony, hardships, financial loss, etc. due to the negligence on the part of the opposite parties.
In light of the circumstances, the following orders are issued:
- The Opposite Parties shall refund of Rs. 65,45,313/- to the complainant as per Exhibit-A- 3.
- The Opposite Parties shall pay Rs 50,00,000/- (fifty lakhs only) as compensation to the complainant for the loss and damages sustained by him due to the negligence, deficiency in service and unfair trade practice on the part of the opposite Parties.
- The Opposite Parties shall also pay the complainant Rs.50,000/- towards the cost of the proceedings.
The Opposite Parties be jointly and severally liable for the above-mentioned directions which shall be complied with by the Opposite Parties within 30 days from the date of the receipt of a copy of this order failing which the amount ordered vide (i) and (ii) above shall attract interest @9% from the date of receipt of a copy of this order till the date of realization.
Pronounced in the Open Commission on this the 18th day of August 2023.
Sd/-
D.B.Binu President
Sd/-
V.Ramachandran Member
Sd/-
Sreevidhia TN., Member
Forwarded by Order
Assistant Registrar
Appendix
Exhibit A1: Land agreement dated 02.12.2015 between the complainant and the opposite party.
Exhibit A2: Construction agreement dated 02.12.2015 between the complainant and the opposite party.
Exhibit A3: Account statement of the complainant with Federal Bank, Kurichi branch, covering the period from 01.05.2012 to 09.02.2017, providing evidence of payment of Rs. 65,45,313/- Exhibit A4: Office copy of the lawyer notice dated 14.06.2019 sent by the complainant to the opposite parties.
Exhibit A5: Postal receipt Nos. RL 645970704IN and RL 645970823IN, both dated 14.06.2019.
Exhibit A6: Reply letter dated 19.06.2019 issued by the opposite parties.
C.C. No.224/2020
Order dated 18/08/2023
