Delhi

StateCommission

A/175/2015

CHAITANYA JAIN - Complainant(s)

Versus

DLF HOME DEVELOPERS LTD. & ANR. - Opp.Party(s)

01 Feb 2017

ORDER

IN THE STATE COMMISSION : DELHI

(Constituted under Section 9 of the Consumer Protection Act, 1986)

Date of Arguments : 01.02.2017

Date of Decision : 17.02.2017

Appeal No. 175/2015

(Arising out of the order dated 09.01.2015 passed in Complaint Case No.324/09 by the

District Consumer Redressal Forum-VI (New Delhi)

In the matter of:

 

Sh. Chaitanya Jain,

S/o Sh. Raj Kumar Jain

26, Friends Colony (West),

New Delhi.                                                                                         …..........Appellant

 

Versus

 

1. M/s. DLF Home Developers Ltd.,

DLF Centre,

Sansad Marg,

New Delhi.

 

2. M/s. Arvind Associates,

CF-14/15, Prakashdeep Building,

7, Tolstoy Marg,

New Delhi.                                                                            ….....Respondents

                                                                

CORAM

 

Sh. O. P. Gupta, Member (Judicial)

Sh. Anil Srivastava, Member

1.     Whether reporters of local newspaper be allowed to see the judgment?                                                               Yes/No

2.      To be referred to the reporter or not?                                                                                                        Yes/No

 

 O.P. Gupta, Member (Judicial)

1. Aggrieved by order dated 09.01.2015 passed by District Forum-VI, the complainant has come in the present appeal.  In nutshell, the case of the appellant was that he booked an  Apartment No.1 on 14^th Floor in Plot No.  PPL 141/PL, 1091/PL, 1092/PL, 1093/PL, 1093/DPP in DLF Park Place, DLF City, Gurgaon and made advance payment of Rs.15 lacs to OP-1 through OP-2 by cheque. OP-1 gave option for loan to finance project of the above apartment by offering financing scheme.  After seeing and verifying the documents and after having verbal confirmation from ICICI bank, OP assured complainant that he would get loan from ICICI bank for purchase of the apartment. However, his request for loan was turned down by ICICI bank .  So he requested the OP to refund the booking amount of Rs.15 lacs and he was no longer interested in purchasing the apartment and sought cancellation of booking vide letter dated 27.02.2007 (coopy placed at page-22 of bunch of appeal).

 

2. OP-1 malafidely forfeited the booking amount of Rs.15 lacs vide letter dated 14.11.2008 which is contrary to assurances/ representation made by them at the time of booking. Hence, he filed complaint for directing OP to refund Rs.15 lacs alongwith interest @18% per annum from 07.12.2006 till date of refund, Rs.50,000/- as compensation for harassment suffered by complainant and cost of proceedings.

 

3. OP-1 filed WS raising preliminary objections that issues relate to contractual matter arising out of agreed terms and conditions as mentioned in the application for allotment as well as apartment buyers agreement. Such matter can only be dealt with by Civil Court and not by Consumer Forum.  The OP is seller of apartments and not service provider.  The complaint is not a complaint within the meaning of section 2(i)(c)  Consumer Protection Act as there is no allegation or averment of any unfair trade practice or restrictive trade practice or deficiency in service. In fact, the bank sanctioned Rs.75 lacs only against request of loan for rupees one crore, based on credentials of complainant. OP never gave assurance to the complainant for getting loan sanctioned. Non sanction of loan is no reason for the complainant to stop payment of further instalments. The complainant is bound by contractual terms mentioned in the agreement.  Regarding facts, it is stated that complainant was sent  allotment letter dated 09.12.2006 intimating that apartment no. L-141 Park Place, Gurgaon alongwith parking has been allotted to him. 2.5 years time bound instalment payment plan was enclosed therewith. It sent agreement to sell for signatures of complainant on 18.08.2007 which was not signed by complainant and sent back.  In the meantime, complainant sent letter dated 4^th May, 2007 for cancellation of allotment and refund of the amount. Vide letter dated 05.03.20007 it clarified that it had never given assurance for sanctioning of loan.  It was clearly mentioned in the application form that if building plans are not sanctioned within one year from the date of application, company would refund the amount deposited with simple interest @9% per annum.  Vide letter dated 18.02.2008 the complainant was informed that payment plan was rescheduled to construction link payment plan from time bound instalment payment plan.

 

4. On merits the OP took the same defence.

 

5. OP-2 also filed written statement raising preliminary objections that it has sold nothing to the complainant nor complainant has paid any money to it.  There is no relation of seller and service provider between complainant and OP-2.

 

6. Complainant filed separate rejoinder to the written statement of both the OPs.  He filed his own evidence by affidavit.

 

7. OP-1 filed affidavit of Sh. Atul Srivastava, AR.  OP-2 filed affidavit of sh. Arvind Verma of M/s. Arvind Associates stating that complainant was not a consumer.

 

8. Complainant filed written arguments. OP-1 filed written arguments.

 

9. After going through the material on record and hearing the arguments. The District Forum dismissed the complaint vide brief order.  It noticed letter dated 21.03.2007 by complainant to OP-2 that he made investment and never intended to live in the flat. Thus, it amounted to showing that flat was for selling in grey market and complainant was not a consumer. It dismissed the complaint.

 

10. In appeal, the grievance of the appellant is that inference drawn by District Forum is farfetched. Simply mentioning that he was not going to live in the flat does not mean that booking was made just for investment purpose only with finance from ICICI Bank  as assured by OP. If bank was unable to finance, he was no longer interested in continuance of booking.

 

11. We have gone through the material on record and heard the arguments. At the very outset, it may be mentioned that the case was ripe for final arguments. The same was pending since 2009 till 2015. It was a travesty of justice and unfair to the complainant to dismiss the complaint on technical ground. In taking this view, we are fortified observation of National Commission in CC No.296/12 titled as Nitin Malik Vs. State of Haryana decided on 09.12.2016.

 

12. Counsel for appellant further submitted that the question as to what amounts to commercial transaction was exhaustively examined by Hon’ble Supreme Court in Laxmi Engineering Works Vs. PSG Industrial Institute, (1995) 3 SCC 583, it was observed as under :-

 

“person having surplus fund available with him would not like to keep said fund idle and would invest them in such manner that he gets maximum return on his investment.  He may invest in bank deposit, shares, mutual funds and bonds or debentures  etc. likewise he may also invest his surplus fund in project of one or more house, which is / are proposed to be constructed by service provider, in the hope that he would get better return on his investment by selling the house(s) on 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 commerce or  business of purchase and selling house(s).”

 

13. The counsel for appellant submitted and rightly so that above observations clearly make the appellant a consumer. He further submitted that it is not the case of OP that appellant had booked other flat or had sold any of flat after purchasing it from OP or any other builder.

 

14. The counsel for appellant further relied upon the decision of National Commission in Satish Kumar Pandey Vs. Unitech, 3 (2015) CPJ 440 wherein para 15 it was observed as under :-

 

“person having surplus fund available with him would not like to keep said fund idle and would see invest them in such manner that he gets maximum return on his investment.  He may invest in bank deposit, shares, mutual funds and bonds or debentures  etc. likewise he may also invest his surplus fund in project of one or more house, which is / are proposed to be constructed by service provider, in the hope that he would get better return on his investment by selling the house(s) on 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 commerce or business of purchase and selling house(s).”

 

15. In Kavita Ahuja Vs. Shipra Estate Ltd. I (2016) CPJ 531 NC it was  held that the OP must show that complainant had entered into agreement to purchase similar other house or has sold house obtained so.  In the absence of the same, the purchaser cannot be excluded from the definition of consumer.

 

16. In view of the aforesaid decisions, there does not remain any scope for contending that complainant was not a consumer.

 

17. Counsel for OP relied upon the decision of Hon’ble Supreme Court in Marine Container Services South Vs Go Go Garments, (1998) 3 SCC 247.  In the said decision what was held is that Contract Act applies to complainant under Consumer Protection Act.  An Agent can invoke Section 230 of Contract Act in the proceedings before Commission or otherwise. We do not  think that same has applicability in the present case. Section 230 Contract Act deals with undisclosed principals.

 

18. Counsel for appellant drew my attention towards the copy of letter dated 09.12.2006 written by OP to him that OP assured that complainant would take full advantage of the above (exclusive arrangement OP had done for the project with the bankers) emphasise laid to make out that OP had assured that complainant would get loan from the bank.  We are unable to impress ourselves with this argument.  But still if it is held that OP did not assure the complainant about sanction of loan, it does not make any difference.  The complainant still had option of quitting and getting refund.

 

19. Counsel for respondent submitted that in DLF Vs. Bhagwanti Narula I (2015) CPJ 319 and in DLF Vs. Dipu C.S. Sanin lal I(2015) CPJ 365 NC it has been held that earnest money can be forfeited. He urged that clause 9 of the agreement permitted the OP to forfeit the earnest money calculated @10% of sale price of the apartment in the event of failure by the complainant to sign and return to the company the apartment buyers agreement within 30 days from the date of its dispatch by OP. Since the price of the flat was Rs.1,68,37,500/-, the OP could forfeit 10% thereof which is more than Rs.15 lacs  deposited by the complainant. Hence, the OP was justified in forfeiting the entire deposited amount.

 

20. Per contra counsel for appellant submitted that complainant had sought cancellation of allotment and refund vide letter dated 27.02.2007 which was after about two months only from booking. By that time the OP had not started any construction.  Its own case in para 4 of brief facts of WS is that it sent agreement to sell for signatures of the complainant on 18.08.2007 it was much after the request of the complainant for cancellation of allotment and refund of amount. Thus, what can be inferred from the WS is that construction has not started before 18.08.2007.  It has not placed on record copy of any plan sanctioned prior to 18.08.2007.  In such situation what can be forfeited is 10% of the booking amount and not entire booking amount.

 

21. The contention appears to be correct. In taking this view we are supported by decision of National Commission in Shipra Estate Vs. Naresh Chandra Seth II (2013) CPJ 120. It pertains to a particular category of applicants who asked for cancellation prior to commencement of construction and payment of further instalment.  Both the said conditions are filled in the present case. So the OP could not forfeit 10% of the sale price or whole amount of booking. At the most it could forfeit 10% of Rs.15 lacs viz. the booking amount.  Allowing that to be forfeited by OP, complainant is entitled to refund of Rs.13.50 lac.

 

22. Now coming to interest part, it may be mentioned that interest claimed by claimant @18% per annum is on the higher side. The agreement provides for refund of principal amount with interest @9% per annum in case the OP fails to get the plan sanctioned. From that clause, analogy can be drawn that OP must pay interest @9% per annum on refund in other situation also.

 

23. To sum up, the appeal is accepted, impugned order is set aside. The respondent is directed to refund Rs.13.5 lacs alongwith interest @9% per annum from the date of deposit i.e. 06.12.2006 till date of refund within 45 days.

 

24. Copy of this order be sent to both the parties free of cost.

 

25. One copy be sent to District Forum for information.

 

26. File be consigned to Record Room.

 

 

(O.P. Gupta)                                                         (Anil Srivastava)

Member (Judicial)                                              Member

Bench-2                                                                 Bench-2

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