The instant complaint under Section 17 (inadvertently mentioned as under Section 12) of the Consumer Protection Act, 1986 (for brevity, ‘the Act’) is at the instance of a couple/intending purchasers against the developer/builder and its officers (opposite party nos. 1 to 5) and the financial institution from which the complainants obtained House Building Loan (opposite party no. 6) on the allegation of deficiency in services on the part of developer/builder in respect of A flat and car parking space in a dispute of housing construction.
Succinctly put, complainants’ case is that on 03.11.2005 they had entered into an agreement with the opposite party no. 1 to purchase of an apartment being no. 0901 on the 9th Floor, Tower-04 having a super built-up area of 2052 sq. ft. more or less in the complex of opposite party no. 1 in ‘Horizons’, Uniworly City, Action Area-III, P.S.- New Town, Kolkata along with one covered car parking space and proportionate undivided share in the common areas at a total consideration of Rs. 35,13,384/-. The complainants have stated that they have already paid Rs. 37,86,844/- an excess amount to opposite party no. 1 adhering to the terms and conditions of the agreement. The opposite party was under obligation to deliver possession by 31.03.2008. However, on 25.11.2011 the complainants visited the site and they were intimated through two letters dated 05.01.2010 along with two sheets one containing statement of accounts as on 31.12.2009 and maintenance notice dated 31.12.2009. On 31.11.2010 the complainants sent a letter intimating the entire facts stating that nothing is due and payable by the complainants in respect of the balance amount payable as per agreement dated 03.11.2005. On 09.12.2012 the complainants sent another letter asking for Completion Certificate. Thereafter, in spite of several reminders the opposite party no. 1 sat over the matter which compelled the complainants to lodge the complaint with prayer for following reliefs, viz.- (a) to direct the opposite party to hand over the possession of the subject flat and thereafter to execute the Deed of Conveyance in favour of the complainants in respect of the flat in question; (b) to direct the opposite parties to handover the excess amount paid by them over and above the consideration sum; (c) a compensation of Rs. 50,00,000/- for harassment and mental agony; (d) an order to pay litigation cost of Rs. 1,50,000/- etc.
The opposite party no. 1 by filing a written version has admitted the existence of agreement and the statement of complainants regarding payment of the amount made by the complainants but stated that by a letter dated 05.01.2010 they informed the complainants that due to change of super built-up area from 2052 sq. ft. to 2182 sq. ft. total cost of the flat has also been changed and the same was hired to Rs. 37,86,844/-. It has further been stated that the complainants are liable to pay further amount on account of maintenance charges and holding charges till the complainants take possession of the said flat in accordance with the said agreement.
The opposite party no. 6 i.e. Housing Development Finance Corporation Limited by filing a separate written version has stated that the complainants do not have any valid cause of action against them and as such the complaint should be dismissed against them.
The parties have tendered evidence on affidavit. They have also given reply against the questionnaire set forth by their adversaries. At the time of final hearing the complainants and opposite party no. 1/developer have filed separate brief notes of argument in support of their respective cases.
On perusal of pleadings and the evidence on record, it has come to surface that the complainants being the applicants signed an Application Form to opposite party no. 1 for allotment of residential apartment no. 0901 on the 9th Floor at Tower – 04 measuring super built-up area 2052 sq. ft. along with one covered car parking space in the complex ‘Horizons’ in the Uniworld City, Action Area-III, New Town, P.S.- New Town, Kolkata together with proportionate undivided share of land for a total consideration of Rs. 35,13,384/- and booked the said flat on payment of Rs. 3,25,000/-. On 25.08.2005 the opposite party no. 1 issued an allotment letter in favour of the complainants in respect of the subject flat. It is not in dispute that the complainants paid an amount of Rs. 37,976/- on 28.09.2005 and Rs. 11,938/- by way of two cheques and also issued three cheques of Rs. 10,000/- each on 30.09.2005.
On 03.11.2005 a buyer’s agreement has been executed by and between the opposite party no. 1/developer and the complainants as the purchaser in respect of the subject flat. As per terms of the agreement, the opposite party no. 1/developer was under obligation to deliver the possession of the apartment to the purchaser by 31.03.2008 subject to Force Majeure circumstances.
Admittedly, opposite party no. 1/developer could not fulfill their promise and failed to delivery possession within the time frame. The opposite party no. 1 has also failed to advance any Force Majeure circumstances which prevented them to comply with the terms and conditions of the agreement.
It is trite law that the parties are bound by the terms of agreement. When either of the parties did not pick up any quarrel with the terms and conditions of the agreement, they are certainly bound to follow the terms and conditions contained in the agreement. In a case reported in AIR 1996 SC 2508 (Bharti Knitting Co. – vs. – DHL World Wide Express Courier Division of Airfreight Ltd.) the Hon’ble Supreme Court has observed thus:-
“It is seen that when a person signs a document which contains certain contractual terms, as rightly pointed out by Mr. R.F.Nariman, Ld. Senior Counsel, that normally parties are bound by such contract; it is for the party to establish exception in a suit. When a party to the contract disputes the binding nature of the signed document, it is for him to prove the terms in the contract or circumstances in which he came to sign the documents need to be established. The question we need to consider is whether the District Forum or the State Commission or the National Commission could go behind the terms of the contract? It is true, as contended by Mr. M.N.Krishanmani, that in an appropriate case, the Tribunal without trenching upon acute disputed question of facts may decide the validity of the terms of the contract based upon the fact situation and may grant remedy. But each case depends upon it own facts. In an appropriate case where there is an acute dispute of facts necessarily the Tribunal has to refer the parties to original Civil Court established under the CPC or appropriate State law to have the claims decided between the parties. But when there is a specific term in the contract, the parties are bound by the terms in the contract”
As per terms of the agreement, as the opposite party no. 1/builder, committed to deliver possession within 31.03.2008 certainly they should have abide by the terms and conditions of the agreement. In any case, on 05.01.2010 the opposite party no. 1 informed the complainant that due to change of super built-up area from 2052 sq. ft. to 2182 sq. ft. the total cost of the flat has also been changed and the same reached to Rs. 37,86,844/-.
In this regard, it would be worthwhile to record that in Clause 2l.(iv) it was categorically agreed that the consideration amount of the Apartment as mentioned in Clause 2.a is firm and that there shall be no escalation after allotment of the Apartment. However, it has been submitted by the opposite party that there has been increase in the super built-up area of the subject flat from 2052 sq. ft. 2182 sq. ft. and the same due to addition of staircase which was not there in the original allotment plan. It implies that without obtaining any allotment plan the developer/builder collected the money from the intending buyer.
In this regard, the decision of the Hon’ble National Commission appears to be relevant for the purpose of ascertaining the issue. In the decision reported in III (2007) CPJ 7 [Kamal Sood – vs. – DLF Universal Ltd.] relying upon the judgment of the Hon’ble Supreme Court reported in II (2000) CPJ 1 [Ghaziabad Development Authority – vs. – Union of India] it has been observed that it is unfair trade practice on the part o builder to collect money from the prospective buyers without obtaining the required permissions, such as zoning plan, lay out plan etc.
Therefore, it was the duty of the developer/builder to obtain the requisite permission or sanction in the first instance and thereafter recover the consideration money from the purchaser. It is an admitted fact that the opposite party no. 1/developer did not obtain lay out plan before entering into agreement for sale with the intending buyers and this act on the part of developer not only construes deficiency in services but also falls under unfair trade practice as defined in Section 2(1)(r) of the Act.
The evidence on record also indicates that the opposite party no. 1/developer could not yet obtain Completion Certificate from the competent authority. In this regard, on a question- “when you have got the Completion Certificate and copy of such Completion Certificate has been delivered in favour of the complainants?” to which the authorised signatory of opposite party no. 1 in reply has stated that Completion Certificate will be received by them after completion of project meaning thereby the construction of the project has not yet been completed.
It is well-settled that after accepting the consideration amount as per agreement, the developer is under obligation to – (a) deliver possession; (b) execute and register the Deed of Conveyance and (c) obtain Completion Certificate from the competent authority. Therefore, considering the evidence on record and having heard the Ld. Advocates appearing for the respective parties, I have no hesitation to hold that the complainants being consumer hired the services of opposite party no. 1/developer on consideration but despite payment of excess amount, the opposite party no. 1 could not provide service to the complainants and on the contrary demanded extra amount on the plea of enhancement of area of the flat beyond the scope of the terms on the agreement and thereby deficient in rendering services to the complainants within the meaning of Section 2(1)(g) read with Section 2(1)(o) of the Act. Accordingly, the complainants are entitled to an order in favour of them to get the Deed executed and registered and receive delivery of possession. It is evident that the opposite party has failed to give any satisfactory explanation when they will be able to deliver the said flat after obtaining Completion Certificate from the competent Authority. In fact, when the record was taken up for final hearing the opposite party no. 1/developer has failed to produce any document as to when they will be able to obtain Completion Certificate from the competent Authority. This clearly demonstrates that opposite party was deficient in rendering services to the complainants although they have received the excess consideration amount.
In that view of the matter and keeping in view the observations of the (1) Hon’ble National Commission in the cases of CC/444/2014 dated 16.01.2015 [Atul Gupta & Anr. – vs. – Unitech Residential Ltd.]; (2) Civil Appeal no. 6044/2015 passed by Hon’ble Supreme Court on 19.10.2016 [M/s. Unitech Residential Resources Ltd. – vs. – Atul Gupta]; (3) CC/429/2014 passed by the Hon’ble National Commission dated 08.06.2015 [Santosh Johari – vs. – Unitech Ltd.] and (4) CC/427/2014 passed by National Commission dated 08.06.2015 [Satish Kumar Pandey & Anr. – vs. – Unitech Ltd.] I am of the view that as per Clause 5.C(ii) where an amount of compensation of Rs. 5/- sq. ft. per month for the delay in offering delivery of possession of the apartment beyond the period as mentioned in the agreement cannot be accepted and instead of the same the complainants are entitled to compensation over the prevalent bank interest and as such I assess the compensation in the form of simple interest @ 8% p.a. from the date of committed date of possession i.e. from 01.04.2008 till the date of delivery of possession. Under compelling circumstances, the complainants lodged the complaint and as such they are entitled to litigation cost which I quantify at Rs. 10,000/-.
With the above discussion, I dispose of the complaint with the following directions:
- The Opposite Party No. 1 is directed to hand over the possession and to execute Deed of Conveyance in respect of the flat in favour of the Complainants as per terms of the Agreement after obtaining Completion Certificate from the competent Authority within sixty (60) days from date;
- The Opposite Party No. 1 is directed to pay compensation in the form of simple interest @ 8% p.a. from the committed date of possession i.e. from 01.04.2008 till the date of actual delivery of possession;
- The Opposite Party No. 1 is directed to pay Rs. 10,000/- as cost of litigation to the Complainants;
- The Opposite Party No. 1 is directed to pay the excess amount, amount of compensation and litigation cost in favour of the Complainants within sixty (60) days from date positively.
