This appeal has been filed by the appellant M/s. TDI Infrastructure Limited against the order dated 24.07.2014 of the State Consumer Disputes Redressal Commission, Punjab, (in short ‘the State Commission’) in CC No.113 of 2012.

2.      Brief facts of the case are that the respondents/complainants booked a shop-cum-office unit (SCO) of the opposite party in the joint name of complainant Col. B.S.Goraya and Jiwan Deep Singh Ghai, in a commercial project of the opposite party by paying Rs.17.50 lacs.  There was no progress in the project and therefore, the complainants filed an application before the opposite party dated 13.08.2009 for refund of the paid amount of Rs.17.50 lacs.  There was no response from the opposite party and therefore, the complainants filed a consumer complaint being CC No.113 of 2012 before the State Commission.  The complaint was resisted by the opposite party by filing the written statement.  A plea was taken that the complainants were not consumers as they had booked the commercial unit for earning profit.  They could not have booked the commercial unit for earning their livelihood as one of the complainants Col. B.S.Goraya was a retired officer who was getting pension.  It was also alleged that the complainants are investors and they had booked three units in the residential project of the opposite party as well as three other units with Unitech Ltd.  Apart from these technical objections, it was also stated that the allotment of the SCO was cancelled by opposite party when the complainants did not pay any further amount and they became defaulter.  The State Commission, however, vide its order dated 24.07.2014 allowed the complaint with the following directions:-

(i)          to refund a sum of Rs.17.50 lacs,

(ii)          to pay interest on the said amount @12% p.a. from the date of deposit till the date of payment by the Ops to the complainants;

(ii)          to pay Rs.1,00,000/- as compensation; and

(iv)        Rs.11,000/- as litigation expenses.

13.        Opposite parties are directed to comply with the above directions within 45 days after the receipt of copy of the order. The complainant shall be at liberty to initiate proceedings under Section 27 of the CP Act against the Ops after the lapse of the abovesaid period.”

3.      Hence the present appeal.

4.      Heard the learned counsel for the parties and perused the record.  Learned counsel for the appellant stated that the total cost of the SCO was about Rs.1,31,00,000/- and 20% was the booking amount, thus, the booking amount was about Rs.26 lacs whereas, the complainant had paid only Rs.17.50 lacs.  Thus, the complainants had not paid the full booking amount as per the provision of the allotment.   If the allottee does not pay the further instalment, the booking amount will be forfeited by the opposite party.  Learned counsel stated that the booking has been done by two individuals jointly and in the booking form the occupation of both the complainants has been mentioned as business.  It is clear that they were already involved their business and therefore, there was no question of purchasing this SCO for earning their livelihood.  Moreover, the complainant No.1 Col. B.S.Guraya retired officer who was getting pension and therefore, it cannot be said that they purchased this SCO for earning livelihood by means of self-employment.  Clearly, the unit booked was a commercial unit in a commercial project and if this was not booked for earning their livelihood by means of self-employment, the complainants are not the consumers under Section 2(1)(d) of the Consumer Protection Act, 1986.  Moreover, the complainants have booked three residential units with opposite party and three other residential units with Unitech Ltd.  Thus, they cannot be considered as genuine consumers as they are basically the investors who booked these properties for earning profit by selling the properties afterwards.  The learned counsel mentioned that in the booking form itself the payment plan was clearly mentioned and the complainants were supposed to have paid the amount as per this payment plan.  The complainants did not pay any amount after paying Rs.17.50 lacs which was not even the complete booking amount. 

5.      Learned counsel for the appellant mentioned that the complaint filed before the State Commission was highly time barred. However, the State Commission has considered and adjudicated the same.  Learned counsel stated that the payment of Rs.17.50 lacs was made in October, 2008 whereas, the complaint has been filed in the year 2012.

6.      It was argued by the learned counsel for the appellant that the full or part earnest money was required to be forfeited by the appellant as per the condition of the booking form.  The State Commission has erroneously ordered the refund of the amount and that too with interest @12% per annum.  The learned counsel stated that first of all, the complainants are not consumers and the complaint was not maintainable before the State Commission as the booking was clearly for a commercial purpose.  The case of the complainants is not covered under the explanation attached to Section 2(1)(d) of the Consumer Protection Act, 1986.  Moreover, there is no justification for allowing interest @12% per annum on the amount of refund. 

7.      On the other hand learned counsel for the respondents/complainants stated that the booking was made in the year 2008. However, there was no progress in the project and therefore, the complainants requested for refund of their amount vide their letter dated 13.08.2009, but there was no response from the opposite party.  Earlier this matter was also taken in the complaint No.50 of 2010, which was filed before the State Commission for a residential plot.  The State Commission vide its order dated 19.03.2012 ordered that the complainants may pursue separate legal remedy for refund of amount of Rs.17.50 lacs paid as booking amount for SCO.  Accordingly, the present complaint was filed before the State Commission. Otherwise also, when neither opposite party allotted any commercial unit nor refunded the amount, the cause of action continued in favour of the complainants.  Thus, the complaint cannot be said to be barred by limitation. With respect to the other properties booked with the opposite parties or with Unitech Ltd., the learned counsel for the respondents stated that the present case is in respect of a commercial unit and the bookings of residential units will not have any connection with this case.  Even then, the learned counsel explained that three bookings with the opposite parties are in respect of the complainant No.1 Col. B.S.Guraya and another booking is in the name of the HUF as well as the third booking is in the name of the wife of the complainant No.1.  The purchasers have not received possession of any of these units. With respect to units booked with Unitech Ltd., the learned counsel stated that there is only one booking in the name of complainant no.1 and a booking is in the name of married daughter of the complainant no.1 as well as another unit in the name of son-in-law.  Thus, the bookings are in the name of different legal entities and cannot be clubbed.  Moreover, this Commission has held in many of its judgments that until an allottee is involved in regular trading in such immovable properties, he cannot be ousted from the provisions of the Consumer Protection Act, 1986. 

8.      Learned counsel for the respondents further argued that no allotment letter was issued in respect of the commercial unit.  However, the opposite party issued only a cancellation letter.  The learned counsel further stated that all these aspects have been considered by the State Commission and the deficiencies on the part of the opposite party are clearly recorded in the impugned order of the State Commission.  The State Commission has rightly ordered refund of the amount of Rs.17.50 lacs along with 12% per annum interest. 

9.      We have carefully considered the arguments advanced by both the learned counsel for the parties and have examined the record.  We agree with the view of the learned counsel for the respondents that the multiplicity of bookings of the residential units will not have any impact on the single unit of the commercial booking in question.  Moreover, multiplicity of the booking is not an issue unless it is proved by the opposite party that the complainants are involved in regular trading in such immovable properties. This Commission in the matter of Aashish Oberai  Vs. Emaar MGF Land Limited, Consumer Case No. 70 of 2015, decided on 14.09.2016, has held as follows:-

“In the case of the purchase of the houses which a builder undertakes to construct for the buyer, the purchase can be said to be for a commercial purpose where it is shown, by producing evidence, that the buyer is engaged in the business of a buying and selling of houses and or plots as a trading activity, with a view to make profits by sale of such houses or plots.  A person cannot be said to have purchased a house for a commercial purpose only by proving that he owns or had purchased more than one houses or plots.  In a given case, separate houses may be purchased by a person for the individual use of his family members.  A person owning a house in a city A may also purchase a house in city B for the purpose of staying in that house during short visits to that city.  A person may buy two or three houses if the requirement of his family cannot be met in one house.  Therefore, it would not be correct to say that in every case where a person owns more than one house, the acquisition of the house is for a commercial purpose”.

It was also observed that:-

“It would be pertinent to note that there is no evidence of the complainant having purchased and then sold any residential property.  Therefore, it would be difficult to say that he was engaged in the business of the buying and selling of the property or that villa in question was booked by him for speculative purposes”. 

10.      In another case, Kavit Ahuja Vs. Shipra Estate Ltd. & Jai Krishna Estate Developers Pvt. Ltd.,  I(2016) CPJ31(NC), wherein three flats were booked by the complainant, this Commission held the complainant to be a consumer within the meaning of Section 2(1)(d) of the Consumer Protection Act, 1986 and held as follows:-

“In the case of the purchase of houses which the service provider undertakes to construct for the purchaser, the purchase can be said to be for a commercial purpose only where it is shown that the purchaser is engaged in the business of purchasing and selling houses and / or plots on a regular basis, solely with a view to make profit by sale of such houses.  If however, a house to be constructed by the service provider is purchased by him purely as an investment and he is not undertaking the trading of houses on a regular basis and in the normal course of the business profession or services in which he is engaged, it would be difficult to say that he had purchased houses for a commercial purpose.  A person having surplus funds available with him would not like to keep such funds idle and would seek to invest them in such a manner that he gets maximum returns on his investment.  He may invest such funds in a Bank Deposits, Shares, Mutual Funds and Bonds or Debentures etc.  Likewise, he may also invest his surplus funds in purchase of one or more houses, which is/are proposed to be constructed by the service provider, in the hope that he would get better return on his investment by selling the said house(s) on a future date when the market value of such house (s) is higher than the price paid or agreed to be paid by him.  That by itself would not mean that he was engaged in the commerce or business of purchasing and selling the house (s).

7.      Generating profit by way of trading, in my view is altogether different from earning capital gains on account of appreciation in the market value of the property unless it is shown that the person acquiring the property was engaged in such acquisition on a regular basis and it was by way of a business activity.

8.  As observed by the Hon’ble Supreme Court in Laxmi Engineering Works (supra) what is a ‘commercial purpose’ is a question of fact to be decided in the facts of each case and it is not the value of the goods that matters but the purpose for which the goods brought are put to. The same would be equally applicable to for hiring or availing services.

9.  In any case, it is not appropriate to classify such acquisition as a commercial activity merely on the basis of the number of houses purchased by a person, unless it is shown that he was engaged in the business of selling and purchasing of houses on a regular basis. If, for instance, a person has two-three children in his family and he purchased three houses one for each of them, it would be difficult to say that the said houses were purchased by him for a commercial purpose. His intention in such a case is not to make profit at a future date but is to provide residential accommodation to his children on account of the love and affection he has for his children. To take another example, if a person has a house say in Delhi but he has business in other places as well and therefore, purchases one or more houses at other places where he has to live presently in connection with the business carried by him, it would be difficult to say that such acquisition is for commercial purpose.  To give one more example, a person owning a house in a Metropolitan city such as Delhi, or Mumbai, may acquire a house at a hill station or a place, which is less crowded and more peaceful than a Metropolitan city, in my view, it cannot be said that such acquisition would be for commercial purpose.  In yet another case, a person may be owning a house but the accommodation may not be sufficient for him and his family, if he acquires one or more additional houses, it cannot be said that he has acquired them for commercial purpose.  Many more such examples can be given.  Therefore, it cannot be said that merely because of the complainant had agreed to purchase three flats in the same complex the said acquisition was for a commercial purpose”. 

11.    This Commission, in Rajesh Malhotra & Ors. Vs. Acron Developers & 2 Ors., First Appeal No. 1287 of 2014, decided on 05.11.2015 has held as follows:-

“12.     Therefore, in order to determine whether the goods are purchased for commercial purpose, the basic pre-requisite would be whether the subject goods have been purchased or the services availed of with the prime motive of trading or business activity in them, for the purpose of making profit, which, as held in Laxmi Engineering (supra) is always a question of fact to be decided in the facts and circumstances of each case”.

12.    We also agree with the learned counsel for the complainants that the complaint was not time barred because neither the unit was allotted nor the amount was refunded even on the request of the complainants by the opposite party and therefore, the cause of action continued till the date of filing of the complaint.

13.    A perusal of the booking form shows that the name of the project is not mentioned in the booking form.  The State Commission has observed the following in its impugned order:-

“6.         A scheme was launched by the Ops Ex. C-1 vide which advance registration form for built up commercial units were called for and in case we go through the terms and conditions, the project was not definite.  It has not been explained where the proposed project will be and what will be the tentative cost.  Although in the documents submitted by the Ops Ex.O 1 later on the price Rs.1,31,00,000/- has been mentioned whereas this fact is not there in their column in application Ex.C-1, therefore, even the price of the commercial unit proposed to be set up is not clear.  According to the schedule for payment, it has been mentioned that 20%  will be at the time of booking but at the time of booking a sum of Rs.17.50 lacs was paid by the complainants and in case it is taken as 20% then the total cost will come to Rs.87.50 lacs, therefore, the cost of the commercial unit as projected by the Ops is not true as mentioned by them as Rs.1.31,00,000/-. In the written reply a plea has been taken by the Ops that after depositing of Rs.17.50 lacs they had undertaken to deposit the balance amount within a week but on the record, the Ops have not placed even a single letter written to the complainants to pay the balance amount to equalise the cost of the unit as Rs.1,31,00,000/- and its 20% should be paid as booking amount. In case we go through the other conditions in the application form, that the Company undertakes to develop the complex at their own cost and expenses and with their own resources after procuring/obtaining the requisite licence/permission sanctions and approval of competent authorities and shall hand over the built up units but no period has been fixed as to when they will start construction.   

7. In the written reply a plea has been taken that their Mega Housing Project Scheme in Village Bhagomajra and Village Behrampur was approved by the Director of Industries for investment of over Rs.310.57 crores.  It is only with regard to the Housing Project to be developed in these villages but does not refer about development of any commercial site.  No document with regard to permission taken from various departments as referred in Ex.C-1 has been placed on the record for the development of Commercial sites.  In case the place is not definite no sanction from various departments is there then how it can be said that they had developed the scheme and now they cannot go back to get refund of their amount deposited with them.  So far as photographs of Connaught Place’ referred in ExO-6 cannot be connected with their scheme till it is explained that in which property the proposed scheme was to be developed or whether this commercial place was developed in that site.  Therefore, in case no project was coming forth as promised by the Ops then vide letter dated 13.8.2009, the complainants demanded back their money taken by the Ops. 

8. If the Ops are reputed builders they should have specified the payment plan, the approximate date, by which the allotment letter would be issued and the approximate dates by which the possession of the commercial site would be delivered. No buyers agreement was executed and no allotment letter was issued allotting a specific commercial site.  Therefore, receiving money without any definite project amounts to unfair trade practice.  When the Ops were to deal with the various departments of the government was a concern of the Ops, the burden of which they could not put on the persons from whom they were accepting the money and who had booked the sites with the Ops.  The Ops also owed some duty to them and they had some obligations towards them to maintain schedule for delivery of possession.  The Ops cannot exploit the persons who deposit money with them for any commercial site.”

14.    The above observations of the State Commission have not been controverted in appeal filed by the opposite party.  If a project is launched without specifying the exact location where the project will come up and even without specifying actual cost of the unit, then it seems this was only a method of collecting certain amounts from some individuals who were interested in giving their money to the opposite party for some kind of investment.  It seems that both the parties knew that there was no such project and it was only a sort of fund raising by opposite party where the complainants also contributed for some kind of return.  We apprehend that this kind of transaction at the most can be treated as the loan to the opposite party by the complainants.  Clearly, it cannot be termed as a booking of the commercial unit because neither the commercial project was identified nor commercial unit was ever allotted. Thus, this was only a transfer of fund from the complainants to the opposite party in the guise of booking.  Thus, the objection raised by the opposite party that the complainants are not consumers because the booking was made for commercial unit in a commercial project cannot be sustained.  Moreover, as observed by the State Commission that the permission was only for developing of housing project and therefore, even conceptually, nothing was to come up as a commercial project.  Thus, the booking amount cannot be treated for commercial unit when there was no permission to develop a commercial project.

15.    It is clear that in the guise of booking, the complainants have given an amount of Rs.17.50 lacs to the opposite party and the opposite party is bound to refund the amount to the complainants.  The State Commission has awarded interest @12% per annum which is quite excessive when the booking was not real and it was only a transfer of fund to the opposite party by the complainants. Clearly, the opposite party is bound to refund this amount to the complainants and they are also bound to give some interest on this amount as the amount has remained with the opposite party for quite some time as held by Hon’ble Supreme Court in Alok Shanker Pandey Vs. Union of India &Ors., II (2007) CPJ 3 (SC) wherein the following has been observed:-

 “9.  It may be mentioned that there is misconception about interest.  Interest is not a penalty or punishment at all, but it is the normal accretion on capital.  For example if A had to pay B a certain amount, say 10 years ago, but he offers that amount to him today, then he has pocketed the interest on the principal amount.  Had A paid that amount to B 10 years ago, B would have invested that amount somewhere and earned interest thereon, but instead of that A has kept that amount with himself and earned interest on it for this period.  Hence equity demands that A should not only pay back the principal amount but also the interest thereon to B.”

16.    Based on the above discussion, we partly allow the appeal of the appellant and modify the order of the State Commission by reducing the rate of interest from 12% p.a. to 6% p.a.  When the interest is being provided on the amount of refund, there is no justification for awarding any separate compensation and that too when the complainants paid this amount to the opposite party without knowing the location of the project or even the cost of the unit.  Accordingly, the order of the State Commission in respect of compensation of Rs.1,00,000/- is set aside.  However, the order in respect of the cost of litigation as Rs.11,000/- is maintained.  The order of the State Commission as modified by this order be complied within a period of 45 days from the date of receipt of this order by the appellant/opposite party.