BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAS NAGAR, MOHALI
Consumer Complaint No.602 of 2014
Date of institution: 07.10.2014
Date of Decision: 31.03.2015
Kamal Deep Sharma, AE Civil AGE BR-1 GE, Amritsar Cantt.
……..Complainant
Versus
1. M/s. Central Govt. Employees Welfare Housing Organization, Sixth Floor, ‘A’ Wing, Janpath Bhawan, Janpath, New Delhi 110 001 through its CEO.
2. CGEWHO Housing Project/Scheme (Phase-1), Sunny Enclave, Sector 125, Kharar, Mohali- 140301 (Punjab) through its Project Manager Shri Bant Singh.
………. Opposite Parties
Complaint under Section 12 of the
Consumer Protection Act, 1986.
CORAM
Mrs. Madhu. P. Singh, President.
Shri A.B. Aggarwal, Member.
Present: Shri J.S. Kahlon, counsel for the complainant.
Shri R.C.Sharma, counsel for the OPs.
(MRS. MADHU P. SINGH, PRESIDENT)
ORDER
According to the complainant, the Central Govt. Employee Welfare Housing Organization is a ‘Society’ established to promote, control and coordinate the development of housing schemes at selected places all over India. The opposite parties (for short ‘the OPs’) floated a scheme for allotment of residential flats under the name and style of ‘Kendriya Vihar, Mohali’. The complainant also applied for a residential flat with the OPs in their project known as ‘Kendriya Vihar, Mohali’ and gave cheque for booking amount of the flat. The OPs sent allotment letter Ex.C-1 giving details of payment schedule till final installment. Thereafter, as per the allotment letter, the 2nd installment was to be paid upon only on commencement of construction, and the same was called upon by the OPs for payment vide letter dated 23.05.2007 which was paid by the complainant on 19.10.2007. Thereafter, the OPs issued circular dated 15.12.2008 informing the complainant regarding technical details and that the plans of the project have been approved by the Local Mohali authority and a technical consultant had now been appointed. The OPs also mentioned regarding increase in area which demonstrates that the construction commenced in December, 2008. Thus the demand of 2nd installment in May, 2007 was wrongly made. The amount of Rs.3,25,000/- towards second installment was paid by the complainant on 19.10.2007 which remained with the OPs till 30.07.2008. The OPs have adjusted interest of Rs.19,140/- arbitrarily whereas it should have been Rs.37,931/- @ 15% which the OPs charge from the beneficiaries. The OPs kept on demanding the installments through notices from time to time by wrongly mentioning the percentage of completion of work but did not complete the construction within the promised time of 30 months. The OPs also held draw at Mohali on 30th /31st March, 2013 for allotment of specific flat/floor and car parking. The complainant continued to deposit the due installments as per the schedule and demand by the OPs. The complainant received Final Call letter dated 18.09.2013 Ex.C-3 alongwith circular of the same date Ex.C-5 from the OPs regarding offer of possession. The OPs are demanding certain amounts which are not payable. The cost of the dwelling unit has been wrongly worked out because the OPs are adding the cost/expenses occurring due to delay on their part. The complainant cannot be penalized for the delay on the part of the OPs. There is no permanent electricity connection granted to the project and even the parking slots are not final. The OPs have charged for the parking which they are supposed to give free alongwith the dwelling units. Thus, the offer of possession is symbolic and not real. The OPs have said that the electricity would be provided through DG sets to the bare minimum extent and ACs, Geysers, heaters would not be able to be used. The offer of possession could only be given after occupation certificate is granted by the Local Authorities which is nowhere in sight in the present case. The OPs are forcing the complainant to pay amounts which are illegal and not payable. Thus there is gross deficiency in service on the part of the OPs.
With these allegations, directions have been sought to the OPs to refund him all the amounts illegally charged which are not as per allotment letter; to pay interest @ 15% i.e. Rs.37,931/- and not 6.5% on second installment amounting to Rs.3,32,500/- kept lying with the OP from 19.10.2007 to 30.07.2008; to pay him compensation to the tune of Rs.7,00,000/- on account of monetary loss and mental and physical harassment; to pay him interest @ 15% per annum on Rs.24,68,430/- deposited by the complainant from January, 2011 till handing over possession; to pay a sum of Rs.1,00,000/- on account of deterrent and punitive damages and Rs.30,000/- as costs of litigation.
2. In the joint written statement, the OPs have pleaded in the preliminary objections that the CGEWHO has been set up as a welfare measure and is not in any manner a realtor or developer in the business of profit making or generating funds and the consumer complaint is not maintainable. The project site does not create territorial jurisdiction as the project cannot be considered as branch office. The projects completed by the CGEWHO are handed over to the beneficiaries exclusively and maintenance of the common services are handed over by forming apartment owners associations which takes care of the entire property and the CGEWHO is left with no role except to ensure the compliance to the local laws and regulations by the beneficiaries. The beneficiaries are required to pay the first installment towards cost of land which is assessed to be about 30% of the total cost of the dwelling units. The project at Mohali is on Turnkey Contract Method, copy of information of which is Ex.OP-2. The complainant has erroneously arrayed the OP No.2 as the same is neither a branch office nor has the distinct legal entity and has been arrayed falsely to create territorial jurisdiction. So the complaint is liable to be dismissed for want of territorial jurisdiction.
The cost of the dwelling units was conveyed to the complainant subject to escalation and revision of cost is to be charged as per clause 16 of the brochure. It was never given to understand to the complainant that the estimated cost was the final figure. The OPs have always acted in fair and transparent manner. As and when the OPs had to incorporate changes in terms of increase in area or escalation of cost, the beneficiaries were given option of withdrawal from the scheme vide letter dated 22.06.2011 and 25.08.2011. No beneficiary has opted for the refund with interest showing that they are satisfied with the housing project. Now the complainant is trying to evade the liability of reasonable escalation despite being aware that initially the projected cost was tentative. The OPs are not selling any product for gain but are providing welfare service and are facilitating the beneficiaries in realizing their dream of owning a home at the place of their choice. The complainant has paid the cost of execution only, on self finance basis, as such, the complainant does not fall within the ambit of definition of ‘consumer’ as defined under the Consumer Protection Act.
On merits, it is pleaded that the project was conceived on Turnkey Contract Method. The insinuation, that scheme was promoted before grant of license, is unfounded and unsustainable. There is no objective of the OPs to collect money except for the construction of housing project. The projects of the OPs are based on demand and requirement only and on no profit basis. No final and concrete promises were made to any of the beneficiary and only tentative details of the project were provided. The beneficiaries were well aware of the progress of the project and the delay, if any, is on account of getting requisite approval from the local authorities which is beyond the control of the OPs. Allotment letters can only be issued after approval of plans which took time at the end of local authorities. In the circular dated 15.12.2008 it was specifically mentioned that the area of dwelling unit was modified as per requirement of the authority competent to approve the plan. In view of certain changes, vide this circular an offer was given to each beneficiary for opting to withdraw from the scheme but the complainants did not opt to withdraw from the scheme. The elected representative of apartment owners association was member of the Project Monitoring Committee whose meeting was held on 19.03.2012. The increase in the cost is as per the technical specifications duly circulated vide letter dated 15.12.2008. The complainants have concealed the letter dated 22.06.2011 issued to all the beneficiaries wherein the detailed reasons for cost escalation were given and again offer for withdrawal from the scheme was made which was kept open for 45 days but no beneficiary including the complainant opted for withdrawal. The electricity connections are to be applied by the individual beneficiary to PSPCL and the OPs have no control over the same. An E-mail in this regard has been sent to the beneficiaries who have taken over the possession. It is not the case that electricity connection is not being provided by the PSPCL for want of electric work in the dwelling unit. The completion certificate of Phase 1 of the project has already been procured by the OPs. The project being on self financing scheme, the cost of the covered car parking would be separately provided. Many beneficiaries have already taken over possession for all practical purposes. The energization of transformers of the housing complex is to be done by PSPCL. The Chief Electrical Inspector Govt. of Punjab has also given clearance for energisation. High tension wires are not passing above the flats and distance much more than the specified limit is maintained from main power line. The construction plan has been approved by the authorities by considering the topographical details at the site. Denying any deficiency of service or unfair trade practice on their part, the OPs have sought dismissal of the complaint.
3. Evidence of the complainant consists of his affidavit Ex.CW1/1 and copies of documents Ex.C-1 to C-5.
4. Evidence of the OPs consists of affidavit of Ms. Anju Arora, AAO of the OPs Ex.OP-1/1 & documents Ex.OP-1 to OP-7.
5. We have heard learned counsel for the parties and gone through the written arguments filed by them.
6. Before we go into the merits of the complaint it will be appropriate to deal with the preliminary objection raised by the OPs. The first preliminary objection is regarding the territorial jurisdiction of this Forum to entertain and adjudicate the present complaints on the ground that as per the brochure Ex.OP-3 of the housing scheme, all legal suits and proceedings against the OPs are to be instituted only in the appropriate courts of New Delhi and notwithstanding the location of the property which may be the subject matter of the dispute. In support of this objection, the OPs have relied upon the judgment of Hon’ble Supreme Court of India in M/s. Swastik Gases Private Ltd. Vs. Indian Oil Corporation. To counter the preliminary objection of territorial jurisdiction, the complainants have relied upon the judgment of Hon’ble Supreme Court India in Sonic Surgical Vs. National Insurance Company Ltd, 2010 (1) RCR( Civil) 1 and Cosmos Infr Engineering India Ltd. Vs Sameer Saksena & Others, Revision Petition Nos. 3117 & 3247, 3254 of 2012 decided on 12.12.2012 (Hon’ble National Commission) wherein it has been held that the branch office of the OPs and the relief sought in the complaint should have direct and complete nexus to invoke the territorial jurisdiction of the District Consumer forum in the territory of which the cause of action has arisen. In the present complaints, the project of the OPs is situated at Mohali, the draw of lots of specific allotment of flats in question has taken place at Mohali. The OPs have project site office at Mohali. All the Project Monitoring Committee meetings of the project are held at Mohali. After meeting the requirements of the demand notices the OPs expect the complainant to take the possession of the flats situated at Mohali. Therefore, the cause of action has arisen in favour of the complainant at Mohali and this Forum has the jurisdiction to entertain and adjudicate the present complaint as the complainant has rightly impleaded OP No.2 in the array of OPs. Therefore, as contended by the complainant we are in full agreement with him and the objection of territorial jurisdiction as raked up by the OPs is not maintainable.
7. The second preliminary objection is that the complaint is not maintainable as the OPs is a no profit no loss body and, therefore, the services provided by them do not fall under the definition of services as enshrined under the Consumer Protection Act. In this regard we have perused the records and found that OPs have not produced anything on record to this averment as no document/statement of account/balance sheet has been produced on record. Even otherwise no profit no loss body is not exempted from the purview of Consumer Protection Act as there are number of judgments on this issue where even the charitable hospitals have been held liable for deficiency in service by the superior Foras. The only requirement under the Act is that there should be a payment made by the complainant to the OP for rendering services as a service provider. The housing activity has been specifically covered under the definition of service in the Consumer Protection Act. The OPs have admittedly accepted the consideration for the flats as per the allotment letters Ex.C-2. Therefore, complainants being consumers and the OPs being service provider are covered under the Consumer Protection Act and the complaints are maintainable. Therefore, the objection of the OPs on this account is not maintainable.
8. Now on merits, admittedly the complainant is allottee of the Flat. The issue involved in the present complaint is regarding delay in completion of the project and handing over the complete and effective possession of the flat in question. The allotment letter Ex.C-1 clearly shows that the project will be complete within 30 months meaning thereby that from May 2007 the time period of 30 months would have expired on 30.11.2009. Admittedly, by this time the possession of the flat in question has not been handed over to the complainant. As per Ex.C-5, the OPs have for the first time provided the technical brochure of Mohali Phase-I project giving all the pertinent details of the project and dwelling units and this is for the first time they have made a revelation that the project had been approved by the local authority. Therefore, vide Ex.C-2 a demand for payment of second installment has been raised by the OPs. Perusal of letter dated 15.12.2008 shows that there is no commitment of time frame for completion of the project and offer of possession. Even if we take 30 months period for completion of construction and handing over the possession from 15.12.2008 when the OPs have got the approval from Local Authority, the said period of 30 months expires on 15.06.2011 and admittedly by this time there was no whisper of offer of possession from the side of the OPs as the project was not completed by then. Further the perusal of Ex.C-3 shows that the possession will be given to the complainant by January 2014 or within one month of energisation of the transformer by the PSPCL whichever is later. Meaning thereby that still the date of possession is indefinite and this arbitrary act of non committal of actual date of possession on the part of the OPs amounts to deficiency in service.
9. Further the complainant has alleged deficiency in service on the part of the OPs in time and again enhancing the tentative price of the flat in question and the same still not finally determined by the OPs as is evident from Ex.C-5. That as per original allotment letter the cost of the flat has been indicated as tentative and the cost was not disputed by the complainants at the initial stage. However, the OPs have voluntarily and arbitrarily chosen to change the price time and again and enhanced the price without giving any valid and cogent reasons. So much so, even today the actual cost of flat has not been determined by the OPs and this act of the OPs to increase the price every now and then amounts to deficiency in service. In support of his contention, the counsel for the complainant has relied upon Deputy Commissioner, M.P. Housing Board and another Vs. Rakesh Kumar Avasthi, Revision Petition No.2340 of 2012 decided on 17.08.2012 (Hon’ble National Commission) and Haryana Urban Development Authority and another Vs. Krishan Kumar Bishnoi, Revision Petition No.2917 of 2012 decided on 21.02.2013 by the Hon’ble National Commission. In order to counter the arguments of escalation, the counsel for the OPs have specifically mentioned that execution of the project, however, suffered due to unavoidable circumstances and, therefore, the escalation being paid to the construction agency shall be based on whole sale price indices and labour wages indices which have been frozen on the original contractual date of completion only. Counsel for the OPs contends that the same cannot be alleged to be deficiency in service as the issue has been settled by the Hon’ble Supreme Court of India in Fuljit Kaur Vs. State of Punjab & Ors. 2010(3) RCR (Civil) 322 wherein it has been held that the developing authority has the right to allot the plot at a tentative price and further can fix the actual price after keeping in view all the attending circumstances. Further the Hon’ble National Commission has passed orders from time to time wherein it has been held that the Consumer Fora cannot go into pricing dispute of the flat/house and the interest charged includes the price of the house leading to escalation. In support of his contention the counsel has relied upon the judgment rendered by the Hon’ble National Commission in Delhi Development Authority Vs. Kamini Chopra I (1996) CPJ 285; Delhi Development Authority Vs. A.N. Sehgal, decided on 30.10.1995; P. Gopala Subramaniam Vs. Vice Chairman, A.P.H.B. Hyderabad, II (1995) CPJ 162 and Sarthak Behura and another Vs. Orissa State Housing Board and Another, III (1993) CPJ 384 and further rendered by the Hon’ble State Commission Orissa in the case Orissa State Housing Board Vs. Rama Chandra Choudhury, IV (2009) CPJ 514. Therefore, the complainant is entitled to compensation on account of delay in delivery by invoking the jurisdiction of Consumer Protection Act for redressal of their complaints. In this regard we seek the shelter of decision of Hon’ble Supreme Court of India rendered in Bangalore Development Authority Vs. Syndicate Bank, 2007 CTJ 689 (SC) wherein the principles have been laid down. The relevant para 10 (d) is reproduced here below:
“Though the relationship between Development Authority and an applicant for allotment is that of a seller and buyer, and therefore governed by law of contracts, (which does not recognize mental agony and suffering as a head of damages for breach), compensation can be awarded to the consumer under the head of mental agony and suffering, by applying the principle of Administrative Law, where the seller being a statutory authority acts negligently, arbitrarily or capriciously.”
10. Further specific issue regarding the high tension wire passing through Phase-I has been discussed in Clause 12 of the Minutes wherein the technical directorate of the Project Monitoring Committee was required to examine the issue. The issue of high tension wire admittedly still persists. In this regard the contention of the OPs is that the high tension wires are not passing over the flats and the distance is much more than the specified limit and which is being maintained from the main power line. Ex.OP-7 i.e. the lay out plan of Phase-II shows that the main power line in the area is located at a distance more than the minimum prescribed distance by the PSPCL. However, the Ops have not adduced any document to show as to what is the minimum prescribed distance approved by the PSPCL for location of the high tension wires and further no site plan/lay out plan has been produced on record to show that the said high tension wires are as per the prescribed limits. The counsel for the complainant has further stated that it is the duty of the OPs to remove the high tension wire so as to ensure that there is no danger to the life of the residents and in case the complainants are not coming forward to seek the possession of the flat in question, they are justified in doing so as the existence of high tension wire is definitely a threat and danger to their life. In support of this contention, the complainant has relied upon a decision of Hon’ble Punjab and Haryana High Court in Radhey Shyam Vs. Haryana Urban Development Authority, CWP No.18773 of 2010 decided on 04.03.2013. Thus, an adverse inference in this regard is drawn against the OPs.
11. Another issue of non availability/reduction in number of covered parking facility has been alleged to deficiency in service on the part of the OPs. As per the complainant, the overhead high tension wire is going above the parking space and the PSPCL has raised an objection to the same and the said objection is yet to be removed by the OPs. During the course of arguments it has emerged that the number of covered parking slot has been reduced at the instance of PSPCL which raised an objection on the layout plan showing covered parking under the high tension wires. The admission on this account per se amounts to deficiency in service as the original lay out plan has not been prepared with due care and consideration of the factual ground situation existing at the site. It is only at the later stage when PSPCL has raised the objection the OPs have woken up to this fact and removed the defect by reducing the number of covered car parking. In fact the complainants were given the understanding at the time of applying through the brochure that sufficient number of covered car parking space is available which gave the complainant an additional amenity to opt for applying for the said flat. However, the assurance of the complainant turned out to be false. In order to counter the contention of the complainant, the OPs made another attempt to convince this Forum that the reduction in number of car parking is detrimental to the interest of the complainant as covered car parking facility is not free of cost and is available to the applicants on payment on the basis of draw of lots. So, therefore, there is no deficiency of service on their part. The counsel for the complainant has further advanced his arguments on the ground that though it is a paid facility but with the reduction in number of covered car parking, their right to apply and be successful in the draw of lots has been abrogated/reduced qua the reduction of number in covered car parking. Thus, as has been admitted by the OPs themselves regarding the reduction in the number of covered car parking, the act of the OPs in doing so amounts to deficiency in service and unfair trade practice on their part.
12. Thus the allegation of deficiency in service qua the parking facility in the project is well proved by the complainant.
13. Admittedly the complainant has been allotted Type-C flat by the OPs on 26.03.2007 vide allotment letter Ex.C-1. Admittedly the possession of the flat was to be handed over to the complainant within 30 months during the completion of the project beginning from the date of second installment in July, 2008 and the said 30 months period expired on January 2011. As per Ex.OP-4 the said timeline has not been adhered to by the OPs and a new date of completion of the project as per the OPs was March, 2012. Even the said date line has not been adhered to by the OPs and the OPs vide Ex.C-3 dated 18.09.2013 has issued the final call up letter to the complainant and offered possession. Thus, it is ample clear that the OPs have failed to adhere to the time line of possession of the flat in question. Thus, there is a clear cut delay in offer of the possession. The said letter of offer of possession, being a defective possession is challenged by the complainant in the present complaint. During the pendency of the complaint, the OPs have improved upon the offer of possession by issuing a fresh letter dated 07.11.2014 Ex.OP-6/A. The perusal of the said letter Ex.OP-6/A shows that the amount due as shown in Ex.C-3 has been revised and further removed all the deficiencies pointed out by the complainant in the complaint regarding electricity, lifts, generators, common services, water and sewerage connection etc. as all necessary completion certificates have been obtained by the OPs and the copies of the same are available on the site of the OPs. Further as per the latest demand notice dated 07.11.2014 the complainant was given a waiver of interest on the said amount till the actual payment and physical possession of the flat in question. No doubt the OPs have taken all corrective steps during the pendency of the complaint.
14. The factum of delay in handing over the possession i.e. delay from January 2011 to 07.11.2014 i.e. more than 3 years cannot be ignored and the act of delay in delivering the possession without any justification by more than 3 years as stipulated in the clause 8 scheme brochure is an act of deficiency in service on the part of the OPs. As stated above, the act of the OPs for not delivering the possession within the stipulated and agreed time of 30 months from the date of second installment i.e. from July, 2008 to January 2011 is an act of deficiency in service and unfair trade practice on the part of the OPs and for this act of the OPs the complainant has been deprived of the use and benefit of his property for more than three years and on this account the complaint deserves to be allowed and the complainant deserves to be compensated for mental agony and physical and mental harassment. For this, we take support from the decision of Hon’ble National Commissioner in Shivalik Cooperative House Building (First) Society Ltd. Vs. Sushil Kumar, 2014(4) CLT 69.
14. Therefore, we allow the present complaint with the following direction to the OPs:
(a) to pay to the complainant compensation to the tune of Rs.50,000/- (Rs. Fifty thousand only) for mental agony and harassment including costs of litigation.
Compliance of this order be made by the OPs within a period of one month from the date of receipt of a certified copy of this order. Certified copies of the order be furnished to the parties forthwith free of cost and thereafter the file be consigned to the record room.
Pronounced.
March 31, 2015
(Mrs. Madhu P. Singh)
President
(A.B. Aggarwal)
Member
