Chandigarh

StateCommission

A/175/2023

VINAY KUMAR SRIVASTAVA - Complainant(s)

Versus

CHANDIGARH HOUSING BOARD THROUGH ITS CHAIRMAN - Opp.Party(s)

NP SHARMA & GAURAV BHARDWAJ

05 Jul 2024

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION, U.T. CHANDIGARH

[Additional Bench]

 

[1]

Appeal No.	:	A/175/2023
Date  of  Institution	:	24/07/2023
Date   of   Decision	:	05/07/2024

 

 

 

 

 

Vinay Kumar Srivastava son of Sh. Mewa Lal Srivastava, Resident of Flat No. 204-A, First Floor, Sector 51-A, Chandigarh – 160047 (U.T).

….Appellant

Vs.

 

1.     The Chandigarh Housing Board, 8, Jan Marg, Sector 9-D, Chandigarh U.T. 160009, through its Chairman.

 

2.     The Chandigarh Housing Board, 8, Jan Marg, Sector 9-D, Chandigarh U.T. 160009, through its Executive Engineer-III.

…. Respondents

 

BEFORE: MRS. PADMA PANDEY   PRESIDING MEMBER

                PREETINDER SINGH      MEMBER

 

PRESENT	:	Sh. Neeraj Pal Sharma, Advocate (on V.C) along with Sh. Gaurav Bhardwaj, Advocate for the Appellant.
		Sh. Vishal Sodhi, Advocate for the Respondents along with
		Sh. Tarun Kumar, J.E. representative of the Respondents.

 

[2]

Appeal No.	:	A/176/2023
Date  of  Institution	:	24/07/2023
Date   of   Decision	:	05/07/2024

 

 

 

 

 

Arun Kumar son of Sh. Nand Kishore, Resident of Flat No. 200-A, First Floor, Sector 51-A, Chandigarh – 160047 (U.T).

….Appellant

Vs.

 

1.     The Chandigarh Housing Board, 8, Jan Marg, Sector 9-D, Chandigarh U.T. 160009, through its Chairman.

 

2.     The Chandigarh Housing Board, 8, Jan Marg, Sector 9-D, Chandigarh U.T. 160009, through its Executive Engineer-III.

…. Respondents

 

BEFORE: MRS. PADMA PANDEY   PRESIDING MEMBER

                PREETINDER SINGH      MEMBER

 

PRESENT	:	Sh. Neeraj Pal Sharma, Advocate (on V.C) along with Sh. Gaurav Bhardwaj, Advocate for the Appellant.
		Sh. Vishal Sodhi, Advocate for the Respondents along with
		Sh. Tarun Kumar, J.E. representative of the Respondents.

 

PER PREETINDER SINGH, MEMBER

1.         This order shall dispose of above captioned Appeals i.e. A/175/2023 filed by the Appellant/ Complainant (Vinay Kumar Srivastava Vs. Chandigarh Housing Board & Anr.) and A/176/2023 filed by the Appellant/ Complainant (Arun Kumar Vs. Chandigarh Housing Board & Anr.), against the order dated 26.05.2023, rendered by the District Consumer Disputes Redressal Commission-I, U.T., Chandigarh (for brevity hereinafter to be referred as ‘the Ld. District Commission’), vide which it dismissed the Consumer Complaints bearing No. CC/370/2020 and CC/371/2020, filed by the Complainants  (S/Sh.Vinay Kumar Srivastava and Arun Kumar), against Opposite Parties (Chandigarh Housing Board), by passing the following order: -

 

 “14.  In view of the aforesaid discussion and the reasons recorded hereinbefore, we do not find any deficiency in service or unfair trade practice on the part of the Opposite Parties. Accordingly, both the consumer complaints, being meritless, are hereby dismissed, leaving the parties to bear their own costs. However, the complainant shall be at liberty to agitate the issue mentioned above before a Court of competent jurisdiction/ appropriate Forum.”

2.         The facts and question of law involved in these two Appeals are identical. However, for the sake of convenience, First Appeal No. 175 of 2013 is treated as the lead case and the facts enumerated hereinafter are taken from the same.

 

3.         Before the Ld. District Commission, it was the case of the Complainant that he applied for a flat with the Opposite Parties under Scheme B and was allotted Flat No.204-A, total cost of which was ₹71,00,000/-. The complainant paid ₹75,32,453 to the Opposite Parties towards the price of the aforesaid flat.  The Opposite Parties received 98% of amount on 15.10.2016 and Opposite Party No.1 was to to handover the possession within 36 months i.e. on 10.06.2019 from the date of issuance of acceptance-cum-demand letter dated 10.6.2016, but they issued allotment letter dated 17.12.2019 directing the complainant to take the possession within 60 days in failure to do so to pay holding charges @Rs.10/- per sq. feet per month from the date of issuance of allotment letter. The complainant took possession on 23.01.2020. After taking the possession the complainant was shocked to see that there were number of snags in the unit, but the complainant due to holding charges took the possession.  The complainant brought the same to the notice of the OPs vide letters dated 04.03.2020 and 09.06.2020, but to no avail. It was alleged, during bidding process it was informed to all the bidders that the flats are transferable and very soon same shall be made free hold, but in the allotment letter per clause 9 and 10 the allotment was made on lease basis for 99 year restricting the allottees to  transfer the unit in question for the next 10 years. Hence, the aforesaid Consumer Complaint was filed before the Ld. District Commission, alleging deficiency in service and unfair trade practice on the part of the Opposite Parties.

 

4.         In the reply filed before the Ld. District Commission, while admitting the factual matrix of the case, Opposite Parties pleaded that the complainant applied for the allotment of 2BR under self financing scheme on 21.05.2016 under Scheme B i.e. Assured Allotment Scheme by depositing an initial amount of ₹6,90,000/- on lease hold basis. The complainant was fully aware of the terms & conditions of allotment of flat in question.  The Opposite Parties issued the acceptance cum demand letter dated 10.06.2016 for the allotment of Dwelling Unit No.204-A(FF) asking the complainant to deposit the remaining payment as prescribed within 90 days. The construction and development work at site except top layer of road and horticulture work i.e. construction of site was completed in the month of December 2019 and accordingly the complainant was issued the final letter of allotment dated 17.12.2019 by offering him physical possession of the Dwelling Unit/flat within a period of 60 days by depositing the amount as demanded and further by completing all such formalities. On 23.01.2020 on completion of all formalities the complainant took possession of the flat without any protest and complaint. Denying that there was any time limit to hand over the possession to the allottees, Opposite Parties pleaded that the constructions delayed due to force majeure conditions which was beyond their control. It was averred that the flat was  allotted to the complainant on “as is where is” basis and it was specifically provided under clause XIII of brochure that the board will not entertain any claim for addition, or alteration or regarding material or any complaints whatsoever, regarding the price of units or its design or material etc.  The complainant never raised any objection before applying for allotment of flat or during the continuation of construction and further at the time of accepting the possession. However, complaints lodged by the complainant were duly attended and rectified. Denying all other allegations and pleading no deficiency in service, the Opposite Parties prayed for dismissal of the Complaint.

 

5.         On appraisal of the pleadings of the parties and the evidence adduced on the record, Ld. District Commission dismissed the Complaints of the Complainants as noticed in the opening para of this order.  

 

6.         Aggrieved against the aforesaid order passed by the Ld. District Commission, the instant Appeals have been filed by the Appellants/Complainants.

 

7.         We have heard the Learned Counsel for the Parties and have gone through the evidence and record of the case with utmost care.

 

8.         The core question that falls for consideration before us is as to whether the Ld. District Commission has rightly passed the impugned order by appreciating the entire material placed before it. 

 

9.         After giving our thoughtful consideration, to the contentions raised and material on record, we are of the considered opinion, that the instant Appeal is liable to be accepted for the reasons to be recorded hereinafter.

 

10.         It is the case of the Appellant/Complainant that the Ld. District Commission while passing the impugned order has failed to appreciate documentary evidence available on record and the findings recorded in Para No.9 to 13 of the impugned order have been recorded in a mechanical and perfunctory manner, which resulted into perverse finding. It has been submitted, the Ld. District Commission failed to appreciate the fact that the Project wherein the Appellant bought Flat in question was highly priced and exorbitantly rated by the Respondents and could in no manner be said to be low cost housing; the defence of force majeure event was not available to Respondents as they themselves manifestly responsible for the tangible delay in the delivery of actual possession to the Appellant/Complainant; there are number of deficiencies in the unit owning to poor workmanship which are per se visible & now incurable, have erroneously been ignored by the Ld. District Commission; the Respondents deserves to be directed to change the character of the flat holding from leasehold to freehold in view of the assurance advanced by the Chairman of the Respondents, which the Ld. District Commission failed to consider. The learned counsel further argued on the similar lines and prayed for acceptance of the present appeal.

 

11.         Conversely, it has been contended on behalf of the Respondent/Opposite Party that the order passed by the Ld. District Commission is quite just & right and does not call for any interference. The detailed finding of facts has already been recorded by the District Commission while rejecting the stand of the Appellant/Complainant. The learned counsel further argued on the similar lines as stated in the complaint filed before the Ld. District Commission and prayed for dismissal of the present appeal. 

 

12.         Admittedly, an amount of ₹75,32,453/- stood paid by the Complainant to the Opposite Parties towards allotment of the subject Flat, which was to be delivered within 36 months from the date of issuance of Acceptance-cum-Demand Letter. The said Acceptance-cum-Demand Letter was issued to the Complainant on 10.06.2016 thence for all intents and purposes the possession was to be delivered by the Opposite Parties latest on/before 09.06.2019.  It is an undisputed fact that the physical possession was taken by the Complainant on 23.01.2020. To wriggle out of the situation, the Opposite Parties had taken refuge of the force majeure circumstances that the delay in delivery of possession of the Unit to the Complainant was solely for the reason of overhead 11 KV HT line and Poles which were removed by the Electricity Department on/around September 2019 and then that area was made available to the Contractor of the Opposite Party for the construction of the units, including the one of the Complainant. 

 

13.         Under above circumstances, the moot question which falls for consideration is, as to whether, the Opposite Parties can claim any immunity for delay in offering possession of the unit in question, on the grounds mentioned above. Pertinently, the scheme in question has been floated by Opposite Parties– Chandigarh Housing Board for general public. Before undertaking such a Scheme, it has to prepare a proper framework in accordance with law and presumption is that the Scheme must have been framed, keeping in view the financial implications and other things. After considering the pros and cons, the Scheme is supposed to have been launched by the development authority, being a public authority. Taking the same into consideration, the applicant applies for allotment of a unit in such a Scheme, specifically when such a Scheme is launched by the Government Authority for the welfare of the general public. The said Scheme was launched by the Opposite Parties for the welfare of the general public, so that needy person can have his/her own house, if he/she or his/her spouse or other dependents were not having any house. Keeping in view all these terms and conditions, complainant purchased the unit from the Opposite Parties.  However, Opposite Parties failed to develop the project and failed to deliver possession of the unit allotted to the complainant, within the stipulated period.  Needless to mention here that the hard earned money to the tune of ₹75,32,453/- was paid by the complainant with a hope to have his unit within the stipulated time. However, his hopes have been dashed to the ground when the Opposite Party laid the blame for the delay elsewhere, first on its own lack of foresight, then on its lackluster coordination efforts with the Electricity Department for removal of the overhead HT lines as also the electricity poles.

 

14.         From the peculiar circumstances of this case, it has been proved that the Opposite Parties made false representations, which were materially incorrect and were made in such a way that the complainant, to whom it was made, was entitled to rely upon it and he may act in reliance on it. The complainant is thereby involved in disadvantageous contract with the Opposite Parties and suffered financial loss, mental agony and physical harassment. Representations/statements made at that time were believed to be true, which act amounts to grave deficiency in providing service, negligence and adoption of unfair trade practice on the part of the Opposite Parties, which has definitely caused a lot of mental agony, harassment and financial loss to the complainant. Moreover, bare perusal of the record transpires that it was because of the delay of Chandigarh Housing Board in getting shifted the 11 KV lines from the Electricity Department that the possession got delayed.  In view of above, the plea of the Opposite Parties that the delay was beyond its control due to shifting of 11 KV lines stands rejected and the Complainant is entitled to delayed compensation for the period of delay in delivery of possession.

 

15.         Learned Counsel for the Opposite Parties argued that even if owing to any force majeure conditions or due to any reasons beyond the control of the Opposite Parties, the Opposite Parties are unable to deliver the unit to the allottee, the Opposite Parties shall be liable to refund to the allottee the amount received along with saving bank interest @4% p.a. and shall not be liable to compensation. However, per material on record, as the Complainant has not asked for the refund and in fact, took possession of the unit, therefore, his limb of argument is of no significance at this juncture.
16.         Now, we proceed to decide as to what amount of compensation should be granted to the complainant, for the period of delay in delivery of possession of the unit. On account of delay in actual delivery of possession of the unit to the complainant, certainly he had suffered mental agony, hardships and financial loss. In the case titled as Lucknow Development Authority v. M K Gupta (1994) 1 SCC 243, the Hon’ble Supreme Court discussed about the extent of the jurisdiction of the Consumer Fora to award just and reasonable compensation for the harassment and agony suffered by a consumer. Ld. counsel for the Opposite Parties contended with vehemence that the flat was allotted to the Appellant/Complainant on “as is where is basis” and it was specifically provided under Clause XIII of the Brochure that the Board would not entertain any claim for addition or alteration or regarding material or any complaints whatsoever regarding the prices of units or its design or material etc. Moreover, the Appellant/ Complainant accepted the terms & conditions of allotment and entered into a contract with open eyes with conscious mind. It may be stated here that this Commission is not bound to rely on a harsh, oppressive and unconscionable clause contained in the terms & conditions of the Scheme/ allotment letter because it is well settled law that a court can strike down an unfair and unreasonable contract, or an unfair and unreasonable clause in a contract, entered into between the parties who are not equal in bargaining power. The consideration or object of an agreement is unlawful inter-alia if it is of such a nature that, if permitted, it would defeat the provisions of any law or if the court regards it as immoral or opposed to public policy. If the object of some terms and conditions of agreement is unlawful, the same are deemed to be void. Our this view is supported by the judgment passed by the Hon'ble Supreme court in the case of Central Inland Water Transport Corporation Ltd. & Anr. Vs. Brojo Nath Ganguly & Ors. (1986) 3 SCC 156 wherein it has been clearly held that the courts can strike down the terms of a contract. The Hon'ble Court has held that "......this principle is that the courts will not enforce and will, when called upon to do so, strike down an unfair and unreasonable contract, or an unfair and unreasonable clause in a contract, entered into between the parties who are not equal in bargaining power...." The draft legislation provided by the Law Commission of India in its 199th Report which addresses the issue of 'Unfair  (Procedural & Substantive) Terms in Contract' has stated  that "A contract or a term thereof is substantively unfair if such contract or the term thereof is in itself harsh, oppressive or unconscionable to one of the parties."  The above view has been reiterated by the Hon'ble Supreme Court in Pioneer Urban Land and Infrastructure Ltd. vs. Gouvindan Raghavan Civil Appeal No.12238/2018 wherein in paragraph nos. 3.8, 6.3, 6.6 & 6.7, it has been clearly held that if the terms of contract are harsh, oppressive and unconscionable to one of the parties, such a contract cannot be relied upon and Courts will not enforce and will, when called upon to do so, strike down an unfair and unreasonable contract, or an unfair and unreasonable clause in a contract, entered into between parties who are not equal in bargaining power.  In this view of the matter, contention raised by the opposite party is rejected.

 

17.         In Nagesh Maruti Utekar Vs. Sunstone Developers Joint Venture, Consumer Case No. 12 of 2017, decided on 04 May 2022, the Hon’ble National Commission awarded interest @9% p.a. from the committed date of delivery till possession is delivered. Relevant part of the said order is reproduced hereunder:-

 

 

 

 

 

“……Consequently, the Opposite Party Developer is directed to pay interest @9% w.e.f. 31.03.2014, i.e., the expected date of delivery of the possession, on the amount deposited by the respective Complainant till 02.09.2017, i.e., the date on which the possession of the Flat was offered by the Opposite Party Developer, within two months from today……”

                             

                In Shreya Kumar & 11 Ors. Vs. M/s. Ansal Housing & Construction Ltd. & 3 Ors., Consumer Case No. 1021 of 2017, decided on 05 May 2022, the Larger Bench of the Hon’ble National Commission has awarded interest @9% p.a. from the committed date of delivery till possession is delivered. Under above circumstances, in our considered opinion, if we grant interest @9% p.a. to the complainant on the entire amount deposited by him, from the due date of possession of their unit, as held above, till delivery of possession thereof, that will meet the ends of justice.

 

18.         Learned Counsel for the Complainant argued that the unit allotted was shorn of quality construction and brimming with latest and patents defects duly mentioned in Para 15 of the Complaint with regard to civil/masonry work, public health related work, security and other issues etc.  Per contra, the Opposite Parties held their nerve pleading that the flats were constructed as per the architectural drawings and layout plan approved by the Chandigarh Housing Board. However, it is pertinent to add here that the Opposite Parties have miserably failed to adduce into evidence said drawing and the layout plan to avoid any scrutiny thereof by this Bench. Moreover, the photographs placed on record by the Complainant not only speak volume about the material used by the Opposite Party, but also depicts the flaws in the construction, thereby compromising the strength of the building. In this view of the matter, we do not find any substance in the stand taken by the Opposite Parties and the same stands rejected.

 

19.         Learned Counsel for the Opposite Parties argued that the complaints lodged by the Complainant were minor in nature and duly attended & rectified by them. It has been argued that during handing over the physical possession of the flat, the Complainant did not raise any question qua the external/internal quality of construction being very poor or that the flat suffered from many permanent defects. However, we do not find any merit in this argument for the reason that an allottee of residential flat does not cease to be consumer of builder/developer on taking possession of the said flat. Recently the Hon’ble Supreme Court in Civil Appeal No. 3343 of 2020 titled as “Debashis Sinha & Others Vs. M/s R.N.R. enterprise Rep. by its Proprietor/ Chairman, Kolkata & Ors.”, has observed that flat-owners, who are often forced by the circumstances to take possession of apartments even if the amenities promised by the builder are not provided, do not forfeit their right to claim such services from the builder. Further, in Neo Build Infrastructure Pvt. Ltd. & Anr. Vs. Sushil Ranjan Roy & Anr., (2024) CPJ 127 (NC), the Hon’ble National Consumer Disputes Redressal Commission has held that a consumer can raise dispute either in respect of any deficiency a per original agreement or any deficiency detected post purchase.

 

20.         The Complainant claims that in view of the assurance advanced by the Chairman of the Respondents during the allotment process on 10.06.2016, the Respondents deserves to be directed to change the character of the flat holding from leasehold to freehold, but the Ld. District Commission failed to consider the same. However, to our mind, since this relates to transfer of title of the immovable property, the Consumer Fora under the Act would not have jurisdiction to give directions to the Opposite Parties to covert the unit of the Complainant from leasehold to freehold. Here, we are fortified by the judicial pronouncement of the Hon'ble Supreme Court in Estate Officer v. Charanjit Kaur (2021) SCC Online SC 686.  

 

21.         In the wake of the position, as sketched out above, the Ld. Lower Commission has wrongly held that there was no deficiency in service or unfair trade practice on the part of Opposite Parties.  The impugned order passed by the Ld. District Commission is therefore based on wrong appreciation of evidence and law on the point and thus suffers from illegality or perversity. 

 

22.         No other point, was urged, by the Ld. Counsel for the Parties.

 

23.         Resultantly, the present appeals are accepted. The order of the Ld. Lower Commission is set-aside and Respondents/ Opposite Parties, are, jointly & severally, directed as under:-

 

In A/175/2023     Vinay Kumar Srivastava Vs. Chandigarh Housing Board & Another:

 

 

i.      To pay to the complainant, compensation by way of interest @9% p.a. starting from 10.06.2019 till 23.01.2020, on the amounts deposited by him, within a period of 30 days from the date of receipt of a certified copy of this order, failing which the entire accumulated amount (10.06.2019 till 23.01.2020) shall carry interest @12% p.a. from the date of default till this entire accumulated amount is paid to the complainant.

 

ii.     To pay to the complainant, a composite compensation to the tune of ₹1,00,000/- for poor quality of construction of the flat and for causing him mental agony & harassment and also for deficiency in providing service and adoption of unfair trade practice and cost of litigation to the tune of ₹30,000/- within a period of 30 days, from the date of receipt of a certified copy of this order, failing which the compensation amount of ₹1,00,000/- shall carry interest @9% p.a. from the date of default till realization.

24.         However, it is made clear that since the interest awarded by this Commission @9% p.a. at Sr. No.(i) above, is by way of compensation, therefore, the Opposite Parties shall not deduct any TDS thereon. Similarly, no TDS shall be deducted by the Opposite Parties on the compensation amount of ₹1,00,000/- awarded at Sr. No.(ii) above.

 

In A/176/2023     Arun Kumar Vs. Chandigarh Housing  Board & Another:

 

 

i.      To pay to the complainant, compensation by way of interest @9% p.a. starting from 10.06.2019 till 23.01.2020, on the amounts deposited by him, within a period of 30 days from the date of receipt of a certified copy of this order, failing which the entire accumulated amount (10.06.2019 till 23.01.2020) shall carry interest @12% p.a. from the date of default till this entire accumulated amount is paid to the complainant.

 

ii.     To pay to the complainant, a composite compensation to the tune of ₹1,00,000/- for poor quality of construction of the flat and for causing him mental agony & harassment and also for deficiency in providing service and adoption of unfair trade practice and cost of litigation to the tune of ₹30,000/- within a period of 30 days, from the date of receipt of a certified copy of this order, failing which the compensation amount of ₹1,00,000/- shall carry interest @9% p.a. from the date of default till realization.

 

25.         However, it is made clear that since the interest awarded by this Commission @9% p.a. at Sr. No.(i) above, is by way of compensation, therefore, the Opposite Parties shall not deduct any TDS thereon. Similarly, no TDS shall be deducted by the Opposite Parties on the compensation amount of ₹1,00,000/- awarded at Sr. No.(ii) above.

 

26.         No other point was urged by the Counsel for the Parties.

 

27.         All the pending application(s), if any, also stands disposed off accordingly.

 

28.         Certified copy of this order be placed on the records of A/176/2023 – Arun Kumar Vs. Chandigarh Housing Board & Anr.

 

29.         Certified Copies of this order be sent to the parties, free of charge.

 

30.         The file be consigned to Record Room, after completion.

Pronounced

05^th July, 2024                                                                  

                                         Sd/-                          

                                                                (PADMA PANDEY)

PRESIDING MEMBER

 

 

Sd/-

(PREETINDER SINGH)

MEMBER

“Dutt”