Haryana

Panchkula

CC/228/2021

KRISHAN LAL . - Complainant(s)

Versus

CHIEF ADMINISTRATOR,HOUSING BAORD HARYANA. - Opp.Party(s)

SATBIR SINGH

20 Oct 2022

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION,  PANCHKULA

 

                                                       

Consumer Complaint No	:	228 of 2021
Date of Institution	:	17.05.2021
Date of Decision	:	20.10.2022

 

 

Krishan Lal s/o Sh. Des Raj, R/o Village Seonsar, Tehsil Pehowa, District Kurukshetra.

 

                                                                           ….Complainant

 

Versus

1.     Chief Administrator, Housing Board Haryana, C-15, Awas Bhawan, Sector-6, Panchkula, Haryana.  

2.     Estate Manager, Housing Board Haryana, Sonipat.

….Opposite Parties

 

COMPLAINT UNDER SECTION 35 OF THE CONSUMER PROTECTION ACT, 2019.

 

Before:              Sh. Satpal, President.

Dr. Pawan Kumar Saini, Member.

Dr. Sushma Garg, Member.

 

 

For the Parties:   Sh. Satbir Mor, Advocate, for complainant. 

                        Sh. Anil Kumar Garg, Advocate for OPs No.1 & 2.

 

ORDER

(Satpal, President)

1.             The brief facts of the present complaint are that the OP No.1 issued advertisement in the year 2013 for the allotment of residential flats for the persons living below poverty line at Sonipat. The total cost of the flat was Rs.4,49,800/- and the complainant  applied for allotment of EWS flat under BPL category at Sonipat vide application dated 22.08.2013. He availed loan of Rs.44,000/-from Sarv Haryana Gramin Bank, Park Road, Kaithal. The complainant deposited Rs.44,000/- at the time of registration and an acknowledgment dated 22.08.2013 was issued by the OP no.1 The application of the complainant was registered vide final registration no.2164 and the draw of lot was held on 13.05.2014. The complainant was allotted flat no.E-231/SF, Housing Board Colony, Sector-18, Sonipat and he was intimated vide memo no.HBH/CRO(PM) 2014/22337 dated 05.08.2014 by the OP No.1. The complainant was further asked to deposit Rs.44,000/- vide letter dated 05.08.2014. The complainant collected money from the near & dears and repaid the amount of Rs.44,000/- taken as loan from Sarv Haryana Gramin Bank. Thereafter, the said bank vide letter dated 30.04.2015 issued No objection Certificate/waivement of charge on flat. The complainant further deposited Rs.49500/- with the OPs. He was issued allotment letter bearing no.5721 dated 20.12.2017 by the OPs. Thus, the total amount deposited by the complainant upto 20.12.2017 was Rs.93,500/-. The complainant is not keeping good health and because of which his financial conditions have become very bad.  As per the provisions of the Haryana Housing Board Act 1971, Rules & Regulations framed thereunder as amended from time to time, the allottee can surrender his flat within 30 days of allotment. The complainant being suffering from financial constraints decided to surrender the flat and vide letter dated 03.01.2018 requested the OP no.2 for the refund of the amount deposited by him. The OP No.2 asked the complainant to wait for 30 days for refund. He waited for several days, however nothing was done. Due to ill health, he has no source of income and no employment due to covid-19 Pandemic scenario. The complainant is running from post to pillar since January, 2018; however, the OPs are not returning the amount deposited by the complainant till date without any justifiable reason. Due to the act and conduct of Ops, the complainant has suffered a great deal of financial loss and mental agony, harassment; hence the present complaint.

2.             Upon notice OPs appeared through counsel and filed written statement raising preliminary objections qua complaint is not maintainable; concealed the true material facts; no cause of action; the complainant has not come with clean hands and suppressed the true material facts. It is stated that no specific date for handing over the possession of the flat was mentioned neither in the scheme floated by the Board nor in the allotment letter of flat. There is no violation of any terms and conditions either of the of scheme or of allotment letter at the hands of the OPs/Board. The construction work of the project could not be undertaken due to constraints beyond the control of the Board. The complainant has never approached the Ops nor any request from the complainant has been received by the OPs. It may not be out of place to mention here that the Ops has been engaged in projects wherein the areas have been developed specifically keeping in mind the category for EWS/BPL of Haryana, therefore, the Ops never had and in present scenario also, has no profit motive, rather have made the mode of allotment easy for the public at large whether it is in terms of payment of installments or application for obtaining the flat under the scheme. On merits, it is stated that the complainant has requested for refund on 03.01.2018 before OPs, which will be entered in the seniority list of 2018, the adjudication of ld. authority is not required. All other pleas and assertions made in the preliminary objections have been reiterated and it has been prayed that there is no deficiency in service on the part of the OPs No.1 & 2 and as such, the complaint of the complainant is liable to be dismissed.

3.             The learned counsel for the complainant has tendered affidavit as Annexure C-A along with documents Annexure C-1 to C-5 in evidence and closed the evidence by making a separate statement. On the other hand, the learned counsel for the OPs tendered affidavit Annexure R-A and closed the evidence.

4.             We have heard learned counsel for the parties and gone through the entire record available on the file including written submission filed by the complainant and OPs, minutely and carefully.

5.             Admittedly, the complainant had applied for the registration of a residential flat, belonging to BPL category, to be constructed by Ops at Sonipat. The payment of sum of Rs.44,000/- vide bank draft dated 22.08.2013 and further the payment of Rs.49,500/- vide DD dated 02.05.2015 made by the complainant is not disputed. The Ops have offered the possession of the flat to the complainant vide letter dated 20.12.2017(Annexure C-4) asking him to take the possession within 30 days. Undisputedly, the complainant vide his application dated 03.1.2018(Annexure C-5) had sought the refund of his deposited amount from OP No.2. The no objection certificate given by Sarv Haryana Gramin Bank, Kaithal, which had financed the amount of earnest money, is available on record as Annexure C-3.

                During arguments, the learned counsel for the complainant reiterating the averments made in complaint has prayed for acceptance of the complainant by directing the OPs to refund the amount of Rs.93,500/- with interest and pay compensation  as claimed  for in the complaint. 

6.             The Ops have contested the complaint by raising preliminary objections as well as on merits in their written statement. Vide first objection, it is stated that the complainant has never approached the Ops for the refund of the amount as prayed for in complaint.

This objection is rejected as the complainant had requested the OP No.2 vide his application dated 03.01.2018(Annexure C-5) to refund the amount.

 The next plea taken by the OPs is that the complainant has not approached the Commission with clean hands. The above objection is also not tenable in view of the facts that the Ops have not clarified as to which of the relevant facts have been concealed by the complainant

The next plea taken by the OPs is that no specific date was given for  handing over the possession of the flat either  in the brochure or in the allotment letter and thus, there is no violation of the terms and conditions as contained in the brochure or in the allotment letter.  The learned counsel for the OPs, while reiterating the averments made in the written statement vehemently contended that the construction work at the site could not be under taken due to various impediments, which were beyond the control of the OPs.

The next plea taken by the Ops is that refund is permissible, as per clause 12 of the Housing Board Haryana(Allotment Management and sale of Tenements), without any interest, only after forfeiture of 10% of the  earnest money  deposited at the time of registration.

7.             The last plea taken by the Ops is that the Housing Board, Haryana, Sector-6, Panchkula is engaged in projects wherein the areas are developed specifically keeping in view the category of EWS/BPL of Haryana and that the OPs are not a developer as portrayed by the complainant. The learned counsel for the Ops vehemently contended that  the Housing Board Haryana was established under the Haryana Housing Board, Act 1971 and thus, the same is statutory body and not a mere Real Estate developer. It is vehemently contended that the Ops never had and in the present scenario also, has no profit motive. On merits, the learned counsel reiterating the averments made in the written statement has prayed for dismissal of the complaint being frivolous and baseless.

8.             Since the OP No.1 is a statutory body and engaged in the construction of flats/houses etc., it is necessary to discuss some authoritative judgments delivered by Hon’ble Apex Court, wherein the liability of statutory body/public sector undertaking, engaged in development work like construction of flats, under Consumer Protection Act has been discussed. The Full Bench of Hon’ble Apex Court vide its judgment dated 11.01.2021 in IREO Grace Realtech Pvt. LTD. Vs. Abhishek Khanna and Others reported in (2021) AIR(SC)437: (2021)AIR (SC) Civil 1291 has placed reliance upon the case law titled as Lucknow Development Authority Vs. M.K.Gupta(1994)1 SCC 243, wherein para no.6, it has been as under:-

“As pointed  out earlier  the entire  purpose of widening the definition is to include  in it  not only day to day buying  and selling activity undertaken by a common man but even such activities  which are otherwise  not commercial  in nature  yet they partake of a character in which some benefit is conferred on the consumer. Construction of a house or flat is for the benefit of person for whom it is constructed.  He may do it himself or hire services of a builder or contractor. The latter being for consideration is service as defined in the Act. Similarly when a statutory authority develops land or allots a site or constructs a house of the benefit of common man it is as much service as by a builder or contractor. The one is contractual service and other statutory service. If the service is defective or it is not what was represented then it would be unfair trade practice as defined in the Act. Any defect in construction activity would be denial of comfort and service to a consumer. When possession of property is not delivered within stipulated period the delay so caused is denial of service. Such dispute or claims are not in respect of immoveable property as argued but deficiency in rendering of service of particular standard, quality or grade. Such deficiencies or omissions are defined in sub-clause(ii) of clause(r ) of Section 2 unfair trade practice”.

9.             The Hon’ble Apex Court vide its celebrated judgment decided on 17.03.2004 in case law titled as Ghaziabad Development Authority Vs. Balbir Singh in Civil Appeal No.7173 of 2002 and connected matters has again placed reliance upon the case law laid down in M.K.Gupta case (supra) as under:-

“However, in the context  of the Consumer Protection Act the principles  laid down  in the case of Lucknow Development  Authority Vs. M.K.Gupta,(1994) 1 SCC 243 have to be kept  in mind. In this case the question was whether a development Authority rendered service to bring it within the purview of the Consumer Protection Act. It has been held that the Development Authority is rendering service. It has been also held as follows:-

8. Having  examined  the wide  reach  of the Act and jurisdiction  of the Commission to entertain a complaint  not only against business or trading  activity  but even against  service  rendered  by statutory  and public authorities, the stage  is now set  for determining if the Commission  in exercise  of its  jurisdiction  under the Act could award  compensation  and if such compensation  could be for harassment  and agony  to a consumer. Both these aspects specially the latter are of vital significance in the present day context. Still more important issue is the liability of payment. That is, should the society or the tax payer be burdened for oppressive and capricious act of the public officers or it be paid by those responsible for it. The administrative law of accountability of public authorities for their arbitrary and even ultra vires actions has taken many strides. It is now accepted both by this Court and English Courts  that the State is liable  to compensate  for loss or injury  suffered  by a citizen due to arbitrary  actions of its employees”.

10.            Apart from above, an another case, which is necessary to he discussed here is that of National Building Construction Corporation Limited(NBCC) Vs. Shri Ram Trivedi, (2021) 5 SCC 273, wherein the Hon’ble Apex Court fastened the liability on the statutory body/public sector undertaking under the Consumer Protection Act on account of its lapses and deficiencies. The Hon’ble Apex Court held that the consumer forums are empowered to award just and reasonable compensation as an incident of its power to direct removal of a deficiency in service and that they are not constrained by the rate prescribed in the agreement. 

11.            From the well settled legal proposition as discussed above, it is clear that liability for any deficiency, on the part of a statutory body like the OPs, can be fastened and the consumer can be awarded the interest as well as the adequate compensation.

12.            Now, we advert to the facts of the present case and  find that the complainant as mentioned earlier para of this order had sought the refund of his deposited amount vide his application dated 03.01.2018 (AnnexureC-5). Admittedly, the complainant was offered the possession of the flat by Ops vide letter dated 20.12.2017 (Annexure C-4) i.e. prior to the seeking of the refund of the deposited amount by the complainant.

13.            We have perused the Clause 12 of Housing Board Haryana (Allotment, Management and Sale of Tenements) Regulation, 1972, according to which, if a allottee withdraws his application prior to the offer of flat then refund is to be made to him after making deductions of 10% of the amount. As the complainant had approached the Ops seeking  the refund of his deposited amount  vide his application dated 03.01.2018(Annexure C-5) after the offer of possession of the flat was made to him vide letter dated 20.12.2017(Annexure C-4). Thus, the provision as contained in the clause 12 ibid are not attracted in the present case. The condition no.2 as contained in the said letter dated 20.12.2017 (Annexure C-4) provides  for forfeiture  of the 50% amount of the earnest money, in case, an allottee fails to take the possession within 30 days. At this stage, it may be relevant to mention here that the learned counsel for the complainant has also agreed that the grievance of the complainant would be entirely redressed, in case the Ops are directed to refund the deposited amount along with interest after making a forfeiture of the 50% of the earnest money.

14.            Now, we take up the issue raised by the Ops that no specific time or period was given by the OPs about the possession of the flat. As per well settled legal proposition, a consumer cannot be made to wait indefinitely for the possession of the flat. The Hon’ble State Commission, U.T. in consumer complaint no.229 of 2019 vide its order dated 03.12.2020 held that the non mentioning of date or period qua the delivery of possession in the allotment letter or/agreement by OPs in itself amounts to adoption of unfair trade practice. It was held that builder is bound to mention the exact/specific date of delivery of possession of the unit(s) to the allottees/purchasers thereof. The Hon’ble State Commission in the case (supra) had placed reliance on the case law titled as Rajeev Nohwar & Anr. Vs. Sahajanand Hi Tech Construction Pvt. Ltd. 2016(2)CPR 769 decided by Hon’ble National Consumer Commission, Relevant part of the judgment delivered in the above case reads as under:-

          “Merely making endeavour to deliver possession by a particular date will also not meet the requirement of law and the promoter is under a legal mandate to stipulate a specific date for delivery of possession of the flat in the agreement which he executes with the flat buyer”.

The Hon’ble Supreme Court in the case tiled as M/s Fortune Infrastructure Appellant(s)(Now known as M/s Hicon Infrastructure) & Anr. Vs. Trevor Dlima & Ors. Civil Appellate Jurisdiction Civil Appeal No(s).3533-3534 of 2017, decided on 12.03.2018, held that when no period of delivery is stipulated, then a time period of 3 years would be reasonable for completion of the contract.

                Therefore, in view of the law as discussed above, the contentions of the Ops that in the absence of any particular date about the delivery of possession of the flat, no deficiency can be attributed, is rejected.

15.            Since the Ops had failed to offer the possession within the period of three years, so, no lapse can be attributed on the part of the complainant while seeking the refund of his deposited amount vide application dated 03.01.2018(Annexure C-5). Therefore, the Ops are deficient while not refunding the deposited amount to the complainant as admissible to him under the law.

16.            Turning to the relief clause, it is found that the complainant had deposited a sum of Rs.93,500/-before the making of offer possession of the flat. The earnest money was Rs.44,000/-, which was deposited at the time of the registration of flat. As per condition no.2 of the said letter dated 20.12.2017(Annexure C-4), 50% amount of the earnest money i.e. Rs.44.000/-may be deducted and thus, the complainant, after making a deduction of  Rs.22,000/- out of deposited amount Rs.93,500/- is entitled to the refund of Rs.71,500/-.

17.            Now, coming to the rate of interest to be awarded on the said amount, it is found that the complainant has claimed the refund of deposited amount along with interest @ 18%p.a. and compensation amounting to Rs.50,000 and Rs.50,000/- on account of mental agony, physical harassment and financial loss etc. and litigation charges respectively.

18.            The OPs have contested the said prayer of the complainant qua rate of interest as well as compensation on the ground that as per the said Regulations, 1972, refund is permissible with interest @ mean savings bank interest of the State Bank of India. In this regard, the learned counsel has placed reliance upon the judgment dated 30.05.2022 delivered by Punjab and Haryana High Court, in CWP No.19124 of 2021 and other connected petitions(total 18 CWPs), wherein it has been held as under:-

          “That being so, and with there being no challenge to the regulation  itself  in these petitions, they are disposed of with a direction to the respondents  to refund, in the case of each  petitioner, the entire  amount of money deposited by her/him in the year 2013/2014(as  the case may be), alongwith the mean savings bank interest  of the State Bank of India, running from the date of the closing  of the registration  in respect  of each scheme, by 30.06.2022 in the case of the Defence  Scheme Type-A Sampla, and till 31.10.2022 in the case of the Employees  Scheme, Jind Road, Rohtak”.

                The learned counsel for the Ops contended that the complainant is not entitled to any other compensation except the refund of deposited amount alongwith interest @ mean savings bank interest of the State Bank of India.

 19.           On the other hand, the learned counsel for the complainant has contended that the complainant had opted to avail the remedy under the CP Act for the redressal of his grievances and that the said remedy is in addition to any other remedy available to a consumer. It is contended that the Consumer Commission is vested with vast powers under Section 38 of CP, Act 2019(Section 14 of CP, Act 1986, old Act) to grant interest as well as compensation on account of mental agony, physical harassment and financial loss etc. suffered by the complainant due to the deficient services of the service provider. The learned counsel for the Ops has placed reliance on the following case laws:-

1. Ghaziabad Development Authority Vs. Balbir Singh in Civil Appeal No.7173 of 2002 decided on 17.03.2004(SC).
2. Experion Developers Pvt. Ltd Vs. Sushma Ashok Shiror in Civil Appeal No.6044 of 2019 decided on 07.04.2022(SC).
3. Charan Singh Vs. Healing Touch Hospital in Civil Appeal No.767 of 2000 decided on 20.09.2000(SC).
4. Dhanbir Singh Vs. Haryana Urban Development Authority in Civil Appeal No.8639 of 2011 decided on 14.10.2011(SC).
5. Wg.Cdr. Arifur Rahman Khan and Aleya Sultana and ors. Vs. DLF Southern Homes  Pvt. Ltd.(now known  as Begur OMR Homes Pvt. Ltd.) and ors. in Civil Appeal No.6239 of 2019 decided on 24.08.2020.

 20.           After hearing the rival contentions of both the parties, now the question which arises for our consideration is how much interest/ compensation is to be paid to the complainant on the amount deposited by him with OPs. As discussed in the preceding paras of this order, the OPs have been found deficient, while rendering services to the complainant, and as per well settled legal propositions discussed in earlier para of this order, the liability for deficiencies on the part of the OPs can be fastened under CP Act.

               The Hon’ble NCDRC, titled as Emaar MGF Land Limited and Another Vs. Amit Puri in F.A.250 of 2014 decided on 30.3.2015 has made a detailed discussion qua compensation, which is as follows:-

        “It is trite that the word compensation is of a very wide connotation. It may constitute actual loss or expected loss and may extend to compensation for physical, mental or even emotional suffering, insult or injury or loss. Explaining the general meaning and amplitude of the word Compensation in the context of the Act, in Lucknow Development Authority Vs. M.K.Gupta-(1994) 1 SCC 243, the Hon’ble Supreme Court observed as follows:-

“The word compensation is again of very wide connotation. It has not been defined in the Act. According to dictionary,  it means, compensating  or being  compensated thing  given  as recompense;  In legal  sense it may  constitute actual  loss or expected  loss and may extend to physical, mental or even emotional  suffering, insult or injury or loss. Therefore, when the Commission has been vested with the jurisdiction to award value of goods or services and compensation it has to be construed widely enabling the Commission to determine included in wide meaning of compensation. The provision in our opinion enables a consumer to claim and empowers the Commission to redress any injustice done to him. Any other construction would defeat the very purpose of the Act. The Commission or the  Forum in the Act is  thus entitled  to award  not only value  of the goods  or services  but also to compensate  a consumer  for injustice  suffered  by him”.

9.       Endorsing the said observations, in Ghaziabad Development Authority Vs. Balbir Singh (2004) 5 SCC 65, the Supreme Court held that the provisions of the Act enable a Consumer to claim and empower the Commission to redress any injustice done. A consumer fora is entitled  to award  not only  value  of goods  or services  but also to  compensate  a consumer  to injustice  suffered  by him. However,  sounding  a note of caution   to the effect  that the compensation  cannot  be awarded  in all cases  on a uniform  basis  or at a uniform  rate,  the Court  has observed  that loss has to be determined by the For a  keeping  in view  a number  of factors like loss of rent  which could have been  earned  of possession had been delivered  or the rent  a consumer  had to pay because of non-delivery of possession on time etc. Emphasizing that compensation in a case where delivery of possession is being directed would be different from a case where only refund of amount is being directed, the Hon’ble Court observed thus:-

          “That compensation cannot be uniform and can best be illustrated by considering cases where possession is being directed to be delivered and cases where only monies are directed to be returned. In cases where possession is being  directed to be delivered  the compensation  for harassment  will necessarily  have  to be less because  in a way that party is being  compensated  by increase  in the value  of the property he is getting. But in cases where monies are being simply returned then the party is suffering, a loss inasmuch as he had deposited the money in the hope of getting a flat/plot. He is being deprived of that flat/plot. He has been deprived of the benefit of escalation of the price of that flat/plot. Therefore, the compensation in such cases would necessarily have to be higher”.

21.            The Hon’ble Apex Court in Civil Appeal No.3182 of 2019 @ SLP(C) Nos.1795 of 2017 decided on 25.03.2019 titled as Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra(SC) has ordered the builder to refund the deposited amount to the Consumer alongwith interest @9%p.a.(S.I.).

22.            The Full Bench of Hon’ble Apex Court vide its judgment dated 11.01.2021 in IREO Grace Realtech Pvt. Ltd. Vs. Abhishek Khanna and Others reported in (2021) AIR(SC)437: (2021)AIR (SC) Civil 129125 has granted the rate of interest @9%p.a.(S.I.) as under:-

          “We are cognizant of the prevailing market conditions as a result of Covid-19 Pandemic, which have greatly impacted the construction industry. In these circumstances, it is necessary to balance the competing interest of both parties. We think  it would be in the interests of justice and fairplay that the amounts deposited  by the Apartment Buyers is refunded with interest @9% S.I. per annum from 27.11.2018 till the date of payment of the entire amount.

          We direct the Developer to refund the entire amount deposited by this respondent along with interest @9% S.I. p.a. within a period of 4 weeks from the date of this judgment. The failure to refund the amount within 4 weeks will make the Developer liable for payment of default interest @12% S.I. p.a. till the payment is made”.

23.            Bearing in mind the aforestated broad principles for determining the question of award of compensation and interest to the complainant, we advert to the facts of the present case, wherein a sum of Rs.93,500/- is lying deposited with the Ops. Respectfully following the law laid down by the Hon’ble Apex Court in aforementioned cases qua granting of compensation as well as interest, the present complaint is partly allowed with the directions to OPs to refund the amount of Rs.71,500/- alongwith interest @9% p.a.(S.I.) w.e.f. 03.01.2018 i.e. when the complainant had sought the refund of the amount. The Ops are further directed to pay a sum of Rs.15,000/- to the complainant as compensation on account of mental agony and harassment and a sum of Rs.5,500/- on account of litigation charges.

24.            The OPs No.1 & 2 shall comply with the order within a period of 45 days from the date of communication of copy of this order failing which the complainant shall be at liberty to approach this Commission for initiation of proceedings under Section 71/72 of CP Act, against the OPs No.1 & 2. A copy of this order shall be forwarded, free of cost, to the parties to the complaint and file be consigned to record room after due compliance.

Announced: 20.10.2022

 

 

 

Dr.Sushma Garg          Dr. Pawan Kumar Saini         Satpal          

        Member                           Member                               President

 

Note: Each and every page of this order has been duly signed by me.

 

                                         Satpal                                        

                                        President