DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAHIBZADA AJIT SINGH NAGAR (MOHALI)

Consumer Complaint No.498 of 2017

                                                Date of institution:  14.07.2017                                             Date of decision   :  29.11.2018

Sunil Bhutani son of Shri Krishan Lal Bhutani, resident of House No.69, Batal Colony, Zirakpur.

…….Complainant

Versus

M/s. Bajwa Developers Limited, through its Managing Director, Shri Jarnail Singh Bajwa, Office at Sunny Enclave, Desu Majra, Tehsil Kharar, District Mohali.

                                                            ……..Opposite Party

Complaint under Section 12 of

the Consumer Protection Act.

Quorum:    Shri G.K. Dhir, President,

                Mrs. Natasha Chopra, Member.

Present:     Shri Abhishek Bhateja, counsel for complainant.

                Shri R.P. Sharma, counsel for OPs.

Order by :-  Shri G.K. Dhir, President.

Order

               OP floated a scheme for developing housing project in Sector 74-A, Mohali by the name and style of Sunny Apartments and on allurements given by representative of OP, he booked one BHK BR No.1257 at Sunny Apartment, F-21, in Sector 74-A, Mohali. That flat was having covered area of 450 sq. ft. and the price consideration thereof was Rs.12,00,150/-. Complainant deposited booking amount of Rs.1.00 lakh vide cheque and thereafter he made payment of another amount of Rs.2.00 lakh on 26.04.2011 through another cheque. Total amount of Rs.3.00 lakhs in this way has been deposited and endorsements of acceptance of these amounts even made on the buyers agreement dated 04.05.2011 by OP. Remaining amount was to be paid to OP by 04.11.2012 in 5 installments of Rs.1,80,000/- each. Assurance was given for delivery of possession by 04.11.2012. Complainant after signing buyers agreement, time and again made calls to the office of OP for asking if approvals of the project have been obtained, but information in that respect never supplied to complainant. Number of calls given to office of OP even did not entail any result. OP kept on procrastinating the matter, but it extended the date for delivery of possession to 31.01.2012 first and then on number of occasions and lastly on 31.01.2015. Rest of the installments not paid because no construction or development carried on the spot and moreover OP never raised demand of balance payment. Complainant claims to be ready and willing to make payment provided possession of the flat handed over to him. Assurance was given for building the project in 18 months i.e. by 04.11.2012, but no progress of the project achieved till date. Rather infrastructure development even has not taken place and as such complainant had to issue legal notice through registered post before filing this complaint. Violation of provisions of PAPRA Act, 1995 committed by OPs and as such by relying on provisions of Sections 3, 4 and 6 of PAPRA Act, this complaint filed for seeking refund of the paid amount of Rs.3.00 lakhs with interest @ 18% per annum. Compensation for mental harassment and agony of Rs.5.00 lakhs and litigation expenses of Rs.25,000/- more claimed.

2.             In reply filed by OP, it is pleaded inter alia  as if complaint has been filed just for seeking refund on the basis of agreement of sale dated 04.05.2011, despite the fact that complaint is barred by limitation in view of Section 27 of Indian Limitation Act as well as Section 24-A of the Consumer Protection Act. Agreement was arrived at on 04.05.2011 and last payment made on 26.04.2011, but this complaint filed on 14.07.2017 i.e. after lapse of more than 4 years. Flat meant for economically weaker sections of the society was got booked by complainant by concealing his identity of being affluent member of the society. OP was kept in dark and as such its consent obtained by fraudulent means for entering into agreement of sale dated 04.05.2011. Construction and possession of the flat was limited to payment plan and as complainant failed to deposit even single installment after initial advance, but kept on getting the dates extended for balance payment and as such it is claimed that as per terms of the agreement, earnest amount liable to be forfeited as per Clause-3 of the agreement. Besides complainant himself committed breach of terms and conditions contained in Clause-7 of the agreement providing that purchaser will be bound to abide by EWS norms prescribed by Punjab Govt. It is claimed that there is no deficiency in service on part of OPs nor they adopted any unfair trade practice. It is claimed that complainant himself failed to provide documents proving his eligibility for allotment of EWS category flat and as such a novel idea adopted by complainant for filing this complaint for recovery of amount for harassing OP. Other averments of the complaint denied by claiming that OPs by putting extra efforts, got approvals from GMADA. It is claimed that work on the project stood halted due to persons like complainant and many others, who after booking flats failed to provide documents and payment of installments.

3.             Complainant to prove his case tendered in evidence his affidavit Ex.CW-1/1 alongwith documents Ex.C-1 to Ex.
C-14 and then closed evidence.  On the other hand counsel for OPs tendered in evidence affidavit Ex.OP-1/1 of Shri Baldev Singh Bajwa, Managing Director and thereafter closed evidence.

4.             Written arguments not submitted by any of the parties. Oral arguments heard and records gone through.

5.             It is not disputed that agreement of sale Ex.C-1 was arrived at between the parties, as per which one BHK BR No.1257 having area of 450 sq. ft. was to be sold by OP to complainant for total sale consideration of Rs.12,00,000/- (rounded off figure). On the agreement itself, endorsements under signatures and stamp of Bajwa Developers are incorporated regarding receipt of total amount of Rs.3.00 lakhs and as such dispute does not remain regarding paid amount of Rs.3.00 lakh by complainant to OP. However, construction activity has not been carried on the spot is a fact borne from produced photographs Ex.C-2 to Ex.C-11 and as such certainly submission advanced by counsel for complainant has force that OP despite assurance of handing over of possession of the flat are not in a position to hand over the same till date. Copy of letter Ex.C-13 is there on the record to establish as if actually OP has obtained permission for development of 25 acres area as per Govt. policy for construction of EWS Group Housing Scheme in Sector 74-A, SAS Nagar. So it is not a case in which requisite approvals by OP from concerned authorities have not been obtained. Even if such approvals have been obtained, but despite that construction work is not completed despite the fact that complainant made last payment on 26.04.2011 and as such certainly fault lay with OP in not completing the project. However, complainant also not sticked to payment plan as mentioned in clause-2 of agreement Ex.C-1, despite the fact that dates for execution of sale deed stood extended from time to time repeatedly. Non sticking to payment schedule plan by complainant as such bound to cause some hindrance in development of the project on account of deficiency of funds available with OPs.

6.             After going through agreement Ex.C-1, it is made out that payment of Rs.3.00 lakhs as earnest amount was to be made on 04.05.2011, but of Rs.1,80,000/- each of first to five installments was to be made on 24.10.2011; 04.01.2012; 04.05.2012; 04.09.2012 and 04.11.2012.  However, complainant paid amount of Rs.2.00 lakhs on 26.04.2011 and before that he made payment of Rs.1.00 lakh on 20.04.2011 and as such it is obvious that virtually complainant paid earnest money amount only. Condition regarding deposit of five installments has not been complied with by complainant. Extension of time was repeatedly granted for registration of sale deed not by OP alone, but with consent of complainant also and as such complainant acquiesced in extension of time, but despite that he himself did not stick to payment plan schedule. Complainant sought refund of the deposited amount for the first time by issue of notice Ex.C-12 dated 09.06.2017. So virtually refund of the deposited amount sought for the first time on 09.06.2017 and not before that. Being so, entitlement of complainant for seeking interest @ 12% per annum allowed with effect from the date of issue of notice Ex.C-12 and not before that because complainant never earlier pressed upon OPs to refund the amount. Rather complainant committed default in making payment of installments. Only 25% of the sale consideration amount deposited by complainant and as such submission advanced by counsel for OPs has force that in view of fault committed by complainant in not adhering to the payment plan, project in question could not be carried forward.

7.             As per law laid down in Randhir Singh and Anr. Vs. Omaxe Chandigarh Extension Developers Pvt. Ltd. 2015(1) CPJ 514 (NC), if the purchaser remained defaulter in not adhering to the installment payment plan, then he is not entitled for any interest, even though the builder had not developed the site, due to which he is not in a position to deliver possession. It is so because he who seeks equity must do equity. In case the equity seeker himself is deficient, then he is not entitled for any interest, is the crux of ratio of above said case. Ratio of this case is fully applicable to the facts of the present case.

8.             Counsel for complainant vehemently placed reliance on composite decision dated 08.02.2018 of Hon’ble Punjab State Consumer Disputes Redressal Commission, Chandigarh delivered in CC No.716, 789, 835 etc. of 2017 titled as Mangal Singh Kondal & others Vs. Bajwa Developer & Another for arguing that refund of the deposited amounts should be with interest @ 12% per annum from the dates of deposit till realisation. That submission of counsel for complainant has no force for purposes of this case, more so when complainant has deposited an amount of Rs.3,00,000/- out of total sale consideration of Rs.12,00,000/- Complainant has deposited as such 25% of the sale consideration amount and as such it is a case in which complainant not sticked to the payment schedule laid down in agreement relied upon by the parties.  In view of this non sticking to the payment schedule plan virtually by complainant, he is entitled for refund of the paid amount with interest @ 12% per annum from the date of first demand put forth by way of issue of notice dated 09.06.2017. Hon’ble State Commission in the above cited case relied upon Rule 17 framed under Punjab Apartment and Property Regulation Act, 1995 for allowing interest @ 12% per annum with effect from the dates of deposits, but in the present case before us, rule applicable is contained in Section 12 of above said Act. Rule 17 has application in cases governed by Section 6 (1) of Punjab Apartment and Property Regulation Act, 1995. That Section 6 (1) of Punjab Apartment and Property Regulation Act, 1995 provides that a promoter intending to construct a building apartment before acceptance of any money as advance payment or deposit, will not accept more than 25% of the sale price and thereafter will enter into written agreement for sale with each of the persons, who are to take possession of apartments/plots. However, Section 12 of Punjab Apartment and Property Regulation Act, 1995 provides that if the promoter fails to give possession in accordance with terms of agreement for reasons beyond his control and of his agents by specified date or further agreed date, then the promoter shall be liable on demand, but without prejudice to any other remedy to which he may be liable, to refund the amounts already received by him in respect of that plot or apartment with simple interest at the rate as may be determined by competent authority, from the date the promoter received the sums till the date the amounts and interest thereon is refunded. Present is a case in which OPs failed to get requisite sanctions/approvals from the authorities as per case of complainant himself. If that be the position, then case in hand is governed by Section 12 of Punjab Apartment and Property Regulation Act, 1995 and not by Section 6 (1) of Punjab Apartment and Property Regulation Act, 1995. Rule 17 of Punjab Apartment and Property Regulation Act, 1995 is applicable, when the case governed by Section 6 of Punjab Apartment and Property Regulation Act, 1995. In view of this, by invoking Section 12 of Punjab Apartment and Property Regulation Act, 1995, this Forum has discretion to allow interest at such rate as is reasonable and appropriate in the facts and circumstances of this case. Moreover, complainant himself failed to comply with requirements of allotment of Economically Weaker Section category flat, despite specific stipulation contained in Clause-7 of agreement Ex.C-1 and as such complainant not entitled to any interest, till the date he sought refund of the same for the first time. That refund for the first time sought by issue of notice dated 09.06.2017 and as such allowing of interest @ 12% per annum from the date of issue of notice will be reasonable, proper, equitable and just.

9.             It is also contended by counsel for complainant that OPs accepted amounts in question from complainant for allotment of EWS category flat by assuring as if the flat is in general category. That submission of counsel for complainant again has not much force because after going through Clause-7 of agreement in question, it is made out that duty was cast upon complainant, being purchaser, to comply with the terms and conditions for allotment of flat in EWS category. If OPs have not issued notice to the complainant for calling upon him to comply with requirements for allotment of EWS category flat, then at the same time complainant also remained at fault in not ascertaining as to whether the allotted flat is in general category or is in the category of EWS. So fault also lay with complainant in view of non compliance with the obligation put on him under Clause-7 of the agreement.

10.            OPs claim through written reply as well as affidavit Ex.OP-1/1 of Baldev Singh, Director of OPs that agreement in question be treated as void and as such virtually the agreement in question sought to be rescinded by OPs. In view of that virtually OPs are seeking declaration of agreement as voidable. Besides after taking us through Clause-7 of agreement Ex.C-1, it is sought to be contended that as purchaser (complainant) failed to fulfill the terms and conditions of agreement or bye laws providing for allotment of EWS category flat and as such agreement in question is void. Certainly after going through Ex.C-1, it is made out that flat in question allotted to complainant was subject to fulfillment of terms and conditions requisite for allotment of flat to EWS category. Even if complainant failed to submit the requisite declaration for showing his entitlement to the EWS category flat in question, despite that the agreement at the most can be declared as voidable at the option of OPs, if they want to treat it as void.

11.            It is vehemently contended by counsel for OPs that in fact flat sought by complainant is of EWS category and as such for getting benefit of EWS Housing Scheme, certificate of annual income of complainant, being less than Rs.3.00 lakhs, from all sources required as per Clause-1 (viii) of scheme evolved by Department of Housing & Urban Development, Govt. of Punjab. Even if complainant may not have fulfilled the requirement to avail benefit of EWS housing scheme, despite that OPs themselves remained at fault in not getting the formalities complied with in that respect by issue of notice or otherwise and as such in case OPs to get the agreement declared void, on account of non fulfillment of conditions by complainant requisite for getting benefit of EWS housing scheme, even then they cannot retain the received amount because in doing so they virtually are seeking unjust enrichment. OPs themselves are also at fault in not starting the construction.

12.            Even if assuming for arguments sake that consent of OPs in entering into agreement Ex.C-1 was obtained by complainant by misrepresentation of his being belonging to economically weaker section category, despite that entitlement of complainant for refund of deposited amount is there in view of Section 64 and 65 of Indian Contract Act, 1872. After going through these sections, it is made out that in case agreement becomes void or is liable to be treated as void at the option of one of the parties, then the party who treats it as void or voidable, must restore such benefits, it has got, to the person from whom these were received. So OPs not entitled to retain amount of Rs.3,00,000/- at all, even if Clause-3 regarding forfeiture of earnest amount may be there in this agreement.

13.           Complainant certainly is consumer of OPs within meaning of Section 2 (1) (d) of CPA because he availed services of OPs for purchase of flat on payment of part of sale consideration with promise of paying balance amount on execution of sale deed or on getting of possession of flat in question. It is the case of complainant that OPs have not developed the project and as such fault lays with OPs in not fulfilling promise of delivering the possession to complainant. For that fault of OPs, complainant cannot be made to suffer and as such on equitable considerations also, complainant entitled for refund of paid amount of Rs.3,00,000/- with interest.

14.            Even if condition No.3 in agreement may be providing for forfeiture of the earnest amount in case payment of installments not made as per schedule, despite that enforcement of this clause by OPs is not legally tenable, because of provisions of Section 64 and 65 of Indian Contract Act referred above and also because of the fact that OPs have not completed the project or even started the same, despite receipt of hefty amount from complainant, as referred above.

15.            Even as per law laid down in Vasant Mahadero Kate Vs. Shastri Gruha Nirman Sahkari Sanstha Ltd. II (2015) CPJ 4 (NC),  purchaser of plot has continuous cause of action available to him unless and until possession of plot handed over to him. So in view of availability of recurring cause of action in favour of complainant till refusal, certainly complaint is not barred by limitation and submission of counsel for OPs to the contrary has no force.

16.            As per case of Kushal K. Rana Vs. M/s. DLF Commercial Complex Ltd., 2015(1) CLT 134 (NC), terms and conditions of buyers agreement for purchase of flat/plot is not a one way traffic, but both the parties are bound by it. In the event of deficiency in service on part of builder, the builder bound to refund the received amounts with interest.

17.            As a sequel of above discussion, complaint allowed by directing OPs to refund the received amount of Rs.3,00,000/- (Rs. Three Lakhs only) with interest @ 12% per annum from the date issue of notice namely 09.06.2017 till payment. Compensation for mental agony and harassment of Rs.20,000/-  (Rs. Twenty thousand only) and litigation expenses of Rs.5,000/- (Rs. Five thousand only) more allowed in favour of complainant and against  OPs.  Payment of amount of compensation and litigation expenses be made within 30 days from the date of receipt of certified copy of the order failing which complainant will be entitled to interest on the amounts of compensation and litigation expenses @ 7% per annum till payment. Certified copies of the order be supplied to the parties as per rules.  File be indexed and consigned to record room.

Announced

November 29, 2018.

                                                                (G.K. Dhir)

                                                                President

(Mrs. Natasha Chopra)

Member