JUSTICE V.K.JAIN (ORAL)

Opposite party No.2 advertised sale of commercial plots by way of auction in Zirakpur, Dist. Ajitgarh. The auction was to be held on 29.4.2013. The complainants submitted a bid for allotment of a plot, depositing a sum of Rs.6,40,000/- as earnest money on 26.4.2013. The demand letter was issued to the complainants on 3.5.2013 asking them to deposit a sum of Rs.1106721/-. The said amount was deposited by the complainants on 6.5.2013. An allotment letter dated 7.6.2013 was then issued to the complainants. They made a total payment of Rs.4493444/- to OP-2 followed by further payment of Rs.746720/- on 19.8.2013. An amount of Rs.164286/- was demanded from them towards interest, without offering possession of the plot to them. The complainant claim to have deposited that amount under duress, on account of threat to forfeit the plot allotted to them. The complainants wrote several letters to OP-2 requesting for providing infrastructural facilities in the area. Their case is that even the basic infrastructural faculties were not provided by the aforesaid opposite party and a possession letter dated 31.3.2016 was issued to them. The possession letter was issued in the sole name of the complainant –Shashi Bala Mittal though the plot according to the complainants was purchased jointly by both of them. Since physical possession of the plot which the complainants had booked for the purpose of earning their livelihood, with basic infrastructural  facilities was not delivered to them, the complainants have approached this Commission seeking the following reliefs:-

“a. Do the demarcation of plot as per approved site plan and handover of actual, physical and legal possession of the plot with the amenities as per assurance/representation given in the advertisement, without any further delay.

b. Pay compensation for deficiency in service and unfair trade practice, amount of interest calculated @15% per annum compounded quarterly (the opposite party have charged compounded quarterly interest @12% from us)  on the deposited amount from the date of actual possession due i.e., May 06, 2013 for delay in handing over of the possession till the date actual, physical & legal possession is handed over to us.

c. Refund the amount of interest Rs.l69215/- (as the interest was payable after possession which is not given till date) and to pay interest on the amount from the date of deposit i.e., 05.02.2014 till the date refund is made.

d. Pay a sum of Rs.15,00,000/- towards compensation on account of mental agony & physical harassment, financial risk, hardship, escalation in the price of the construction cost and emotional disturbance caused to us due to the actions/omissions of the opposite party.

e. Pay costs of litigation amount of Rs.50,000/-.

f. Get the registered deed-executed/ plot transferred in our name and entered in the revenue records as Individual and separate owners of the plot no.14 (not as shareholders of land).

g. To allow the construction as per approved Building Plan/Map vide letter dated 26.04.2016 for which the fee is already paid, without any fee etc. (Construction can't be done due to not handing over the physical possession).

h. This Hon'ble commission may also kindly be pleased to grant such other or further relief which it deem fit and proper in the facts and circumstances of the case.

It is further respectfully prayed to the hon'ble Commission that in case the opposite parties fails to give immediate actual, physical & legal possession of the plot, then the opposite parties may kindly be directed to refund the entire amount paid by us along with compensation in the form of interest at the rate of 18% compounded quarterly from the respective dates of deposits. Pay a sum of Rs.15.Q0.000/- towards compensation on account of mental agony & physical harassment, financial risk, hardship and emotional disturbance caused to us due to the actions/omissions of the opposite party. Pay costs of litigation amount of Rs.50,000/-.”

2.      The complainant has been opposed by OP-2,  which has admitted the allotment made to the complainants as well as the payment received from them. It is stated in the written version that on receiving the letters dated 15.9.2017 and 12.10.2017 from the complainants, the matter was processed and the letter dated 26.12.2017 was issued to the complainant as well as other successful bidders to get the sale deed executed. Therefore, directions were given by OP-2  to its Engineering Branch on 28.12.2017 to deliver physical possession of the plot and doing the needful, but the complainants did not come forward to get the sale deed executed. It is also stated in the written version that the plans for the construction have already been approved by them.

3.      A perusal of the advertisement issued by OP-2 for auctioning the plot would show that the possession of the plot was to be delivered on payment of 25% of the bid amount. The possession came to be offered to them only on 31.3.2016.

4.      The case of the complainants is that though possession was offered on 31.3.2016, they could not have accepted the same since even the basic infrastructure such as construction of roads and laying of sewerage and water lines had not been done by the opposite party. This is not the case of the opposite party that the required infrastructure was complete on the date the possession was offered to the complainants. Therefore, the complainants were justified in not taking the physical possession of the plot pursuant to the letter dated 31.3.2016 since no one can construct and occupy the building on a plot which has not been demarcated and which does not have even the basic infrastructure such as waterlines and sewerage lines. In my opinion, the opposite party was under an obligation to provide the basic infrastructure such as construction of roads, laying sewerage line and laying of waterlines before offering possession to the complainants. That having not been done, they were clearly deficient in rendering services to the complainants who wanted to construct a building on that plot for the purpose of earning their livelihood by way of self-employment.

5.      It has come in the written version of the contesting opposite party, i.e., OP-2  that they had directed the Engineering Department on 28.12.2017 to physical possession of the plot to the complainants. It is thus obvious that physical infrastructure was not complete before that date. When questioned in this regard, the learned counsel for the opposite party fairly submits that the sewerage lines and water line have been laid only about six months ago though he maintains that road of the backside had already been constructed. He submits that on the front side, only interlocking tiles had to be provided and the work of laying interlocking  tiles is in progress and is likely to be completed in two months.  The learned counsel for the opposite party submits that other plot holders are already raising construction on the plots allotted to them. In my view, the provision of water and sewerage would be necessary in every building and therefore, raising construction without these basic facilities would be meaningless. This is more so when the plot is not accessible, the interlocking tiles on the front side of the plot having not been laid so far.

6.      The complainants applied for allotment of a plot way back in April 2013. Even if I accept the submission of the learned counsel for the opposite party that the sewerage line and water lines were laid about six months ago, the possession has been delayed by more than 7 years since the possession as per the advertisement given by the opposite party was to be delivered on deposit of 25% of the sale consideration. Moreover, the plot allotted to the complainants is not accessible  as on today since the work of providing interlocking tiles is yet to be completed. Therefore, even if they take physical possession of the plot, the complainants cannot as on today start constructing  a building on the plot  which they had purchased from the opposite party.

7.      The complainants one of whom is a specially abled person who are present through video conferencing submit that considering the delay already caused by the opposite party, they do not want to wait any more for the possession of the plot after completion of the development work in all respects and want refund of the amount which they paid to the opposite party with appropriate compensation etc.

8.      Considering that the complainants have already waited for more than 7 years, they cannot be compelled to wait further for the possession of the plot which was allotted to them way back in the year 2013.  A reference can appropriately be made to the decision of the Hon’ble Supreme Court in Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan & Connected Matter (2019) 5 SCC 725 and the decision of the Hon’ble Supreme Court in Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra II (2019) CPJ 29 (SC).

In Devasis Rudra (supra), the possession was offered to the complainant/appellant during the pendency of the complaint before the State Commission and it was contended that the said builder having made substantial investment in terms of the agreement, a direction for refund was not warranted.  In the Consumer Complaint filed in Devasis Rudra (supra), the complainant/appellant had prayed for possession of the house and in the alternative, for refund of the amount paid by him to the developer.  In view of the said prayer made in the Consumer Complaint, it was argued on behalf of the builder that he should be made to accept possession of the allotted house and refund and not be allowed to him.  The complainant, on the other hand, contended that at the time the Consumer Complaint was filed, he was ready and willing to accept the possession, but seven years having elapsed, he was not more willing to accept possession.  Allowing the appeal, the Hon’ble Supreme Court inter-alia held as under:

          “It would be manifestly unreasonable to construe the contract between the parties as requiring the buyer to wait indefinitely for possession.  By 2016, nearly seven years had elapsed from the date of the agreement. Even according to the developer, the completion certificate was received on 29 March 2016.  This was nearly seven years after the extended date for the handing over of possession prescribed by the agreement.  A buyer can be expected to wait for possession for a reasonable period. A period of seven years is beyond what is reasonable. Hence, it would have been manifestly unfair to non-suit the buyer merely on the basis of the first prayer in the reliefs sought before the SCDRC.  There was in any event a prayer for refund.”

            In the present case, the possession is not offered till today to all the allottees and the development is still not complete.

In Pioneer Urban Land & Infrastructure Ltd. (supra), the builder submitted before this Commission itself that since the construction of the apartment was complete and Occupancy Certificate had been obtained, the flat purchaser must be directed to accept the possession instead of directing refund of the amount deposited.  In that case, there was a delay of about three years in offering possession and the flat purchaser had submitted that he was not interested in taking possession after delay of about three years.  He also stated that he had taken an alternative property in Gurgaon.  This Commission having allowed refund to the complainant/respondent, the appellant before the Hon’ble Supreme Court inter-alia contended that as per the terms of the agreement executed between the parties, the flat purchaser could claim refund only after expiry of twelve months from the grace period by terminating the agreement but the Consumer Complaint had been filed even before the said twelve months period after the grace period had come to an end.  Rejecting the contentions advanced by the builder, the Hon’ble Supreme Court inter-alia held as under:     

6.1. In the present case, admittedly the Appellant – Builder obtained the Occupancy Certificate almost 2 years after the date stipulated in the Apartment Buyer’s Agreement. As a consequence, there was a failure to hand over possession of the flat to the Respondent – Flat Purchaser within a reasonable period. The Occupancy Certificate was obtained after a delay of more than 2 years on 28.08.2018 during the pendency of the proceedings before the National Commission.

In Lucknow Development Authority v. M.K. Gupta,2 this Court held that when a person hires the services of a builder, or a contractor, for the construction of a house or a flat, and the same is for a consideration, it is a “service” as defined by Section 2 (o) of the Consumer Protection Act, 1986. The inordinate delay in handing over possession of the flat clearly amounts to deficiency of service.  

In Fortune Infrastructure & Anr. v. Trevor D’Lima & Ors.,3 this Court held that a person cannot be made to wait indefinitely for possession of the flat allotted to him, and is entitled to seek refund of the amount paid by him, along with compensation.

6.2. The Respondent – Flat Purchaser has made out a clear case of deficiency of service on the part of the Appellant – Builder. The Respondent – Flat Purchaser was justified in terminating the Apartment Buyer’s Agreement by filing the Consumer Complaint, and cannot be compelled to accept the possession whenever it is offered by the Builder. The Respondent – Purchaser was legally entitled to seek refund of the money deposited by him along with appropriate compensation.”

9.      In the facts and circumstances of case noted hereinabove, the complainants are held entitled to refund the entire amount which they paid to the opposite party alongwith compensation in the form of simple interest. The opposite party No.2 , namely, Municipal Council Zirakpur is, therefore, directed to refund the entire amount received by it from the complainants to them alongwith compensation in the form of simple interest @ 9% p.a. from the date of each payment till the date of refund. The opposite party shall also pay a sum of Rs.25,000/- to the complainants towards the cost of litigation. The payment in terms of this order shall be made within three months from today.