DLF Homes Panchkula Private Limited V/S Mrs. Sunita Dhull - Consumer Court Case

Chandigarh

StateCommission

CC/595/2017

Mrs. Sunita Dhull - Complainant(s)

Versus

DLF Homes Panchkula Private Limited - Opp.Party(s)

Jagjeet Beniwal Adv.

23 Apr 2018

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Consumer Complaint	:	595 of 2017
Date of Institution	:	08.08.2017
Date of Decision	:	23.04.2018

Mrs. Sunita Dhull wife of Jagat Singh Dhull resident of House No.85 Park Colony Bhiwani, District Bhiwani, Haryana.
Jagat Singh Dhull son of Sh. Dariya Singh resident of House No.85 Park Colony Bhiwani, District Bhiwani, Haryana.

…….Complainants.

Versus

DLF Homes Panchkula Private Limited, SCO 190-191-192, Sector 8-C Chandigarh – UT. Pin-160009 through its Manager/Authorized Signatory/Officer-in-charge/ Director Sales & Marketing.

2^nd Address:-

DLF Homes Panchkula Private Limited, Regd. Office DLF Gateway Tower, Second Floor, DLF City, Phase-III, Gurgaon – 122002, Haryana, India through its Manager/Authorized Signatory/Office-in-charge/Director Sales & Marketing.

..........Opposite Party.

Argued by:

Sh. Jagjeet Beniwal, Advocate for the complainants.

Sh. Arjun Sharma, Advocate for the Opposite Parties.

Consumer Complaint	:	346 of 2017
Date of Institution	:	21.04.2017
Date of Decision	:	23.04.2018

Jaiveer Singh Narwal S/o Raghbir Singh R/o B-7, Officer Colony (DC Colony), Jind, Haryana.
Poonam W/o Jaiveer Singh Narwal S/o Raghbir Singh R/o B-7, Officer Colony (DC Colony), Jind, Haryana.

…….Complainants.

Versus

DLF Homes Panchkula Pvt. Ltd., SCO No.190-191-192, Sector 8-C, Chandigarh through its Managing Director/Authorized Signatory.

..........Opposite Party.

Argued by:

Sh. Karan Garg, Advocate for the complainants.

Sh. Arjun Sharma, Advocate for the Opposite Party.

Consumer Complaint	:	718 of 2017
Date of Institution	:	29.09.2017
Date of Decision	:	23.04.2018

Surender Singh Rathee S/o Sh. Dharmvir Singh R/o Flat No.40-C, Army Flats, Sector-4, Mansa Devi Complex, Panchkula.

…….Complainant.

Versus

DLF Homes Panchkula Pvt. Ltd., SCO 190-191-192,
Sector 8-C Chandigarh U.T. Pin-160009 through its Manager/Authorized Signatory/Officer-in-charge/Director Sales & Marketing.

Registered Office Address:

M/s DLF Homes Panchkula Pvt. Ltd., Registered Office: DLF Gateway Tower, Second Floor, DLF City, Phase-III, Gurgaon – 122002, Haryana, India through its Manager/Authorized Signatory/Officer-in-charge/Director Sales & Marketing.

Ananta Raghuvanshi, Executive Director, Sales and Marketing, DLF Gateway Tower, Second Floor, DLF City, Phase-III, Gurgaon – 122002, Haryana, India.

..........Opposite Parties.

Argued by:

Sh. Narender Yadav, Advocate for the complainant.

Sh. Arjun Sharma, Advocate for the Opposite Parties.

Consumer Complaint	:	802 of 2017
Date of Institution	:	21.11.2017
Date of Decision	:	23.04.2018

Deepak Katoch S/o Late Sh. Prakash Chand Katoch,
Prasanta Katoch W/o Sh. Deepak Katoch,

Both R/o Sharanam-11 Apartments, Nearby SHALBY Hospital, Satellite, Ahmedabad.

…….Complainants.

Versus

DLF Homes Panchkula Pvt. Ltd., SCO 190-191-192,
Sector 8-C Chandigarh U.T. Pin-160009 through its Manager/Authorized Signatory/Officer-in-charge/Director Sales & Marketing.

Registered Office Address:

Rakesh Kerwell, Director, DLF Gateway Tower, Second Floor, DLF City, Phase-III, Gurgaon – 122002, Haryana India.
Ananta Raghuvanshi, Executive Director, Sales and Marketing, DLF Gateway Tower, Second Floor, DLF City, Phase-III, Gurgaon – 122002, Haryana, India.

..........Opposite Parties.

Argued by:

Sh. Narender Yadav, Advocate for the complainants.

Sh. Arjun Sharma, Advocate for the Opposite Parties.

Consumer Complaint	:	804 of 2017
Date of Institution	:	21.11.2017
Date of Decision	:	23.04.2018

Juhi Puthur W/o Sh. Prem Kumar Puthur R/o 9 Colburn Road, East Burnswick, NJ – 08816, United States presently residing at H.No.3, Sector-55, Gurugram, Haryana.

…….Complainant.

Versus

DLF Homes Panchkula Pvt. Ltd., SCO 190-191-192,
Sector 8-C Chandigarh U.T. Pin-160009 through its Manager/Authorized Signatory/Officer-in-charge/Director Sales & Marketing.

Registered Office Address:

Rakesh Kerwell, Director, DLF Gateway Tower, Second Floor, DLF City, Phase-III, Gurgaon – 122002, Haryana India.
Ananta Raghuvanshi, Executive Director, Sales and Marketing, DLF Gateway Tower, Second Floor, DLF City, Phase-III, Gurgaon – 122002, Haryana, India.

..........Opposite Parties.

Argued by:

Sh. Narender Yadav, Advocate for the complainant.

Sh. Arjun Sharma, Advocate for the Opposite Parties.

Consumer Complaint	:	848 of 2017
Date of Institution	:	19.12.2017
Date of Decision	:	23.04.2018

Sh. Ashok Sharma aged 58 years son of Sh. R. L. Sharma,
Smt. Rajni Sharma wife of Sh. Ashok Kumar Sharma,

Both residents of House No.G-16/2, DLF City, Phase I, Gugaon, Haryana.

…….Complainants.

Versus

DLF Homes Panchkula Pvt. Ltd., SCO No.190-191-192, Sec. 8-C, Chandigarh – 160009 through its authorized Managing Director/Director/Signatory/Manager/Office-in-Charge/Director Sales & marketing/M.D.
DLF Homes Panchkula Pvt. Ltd., Regd. Office DLF Gateway Tower, Second Floor, DLF City, Phase-III, Gurgaon – 122002, Haryana, India through its Authorized Signatory/Manager/Office-in-Charge/ Director Sales & marketing/M.D.

..........Opposite Parties.

Argued by:

Sh. Sunidh Kashyap, Advocate for the complainants.

Sh. Arjun Sharma, Advocate for the Opposite Parties.

Consumer Complaint	:	11 of 2018
Date of Institution	:	09.01.2018
Date of Decision	:	23.04.2018

Simran Kaur Tiwana W/o Brig. Ranbir Singh,
Brig. Ranbir Singh S/o Sh. Teja Singh Tiwana,

Both R/o R-1102, SISPAL VIHAR, Sector-49, Sohna Road, Gurgaon – 122001, Haryana.

…….Complainants.

Versus

DLF Homes Panchkula Pvt. Ltd., SCO 190-191-192,
Sector 8-C Chandigarh U.T. Pin-160009 through its Manager/Authorized Signatory/Officer-in-charge/Director Sales & Marketing.

Registered Office Address:

Rakesh Kerwell, Director, DLF Gateway Tower, Second Floor, DLF City, Phase-III, Gurgaon – 122002, Haryana India.
Ananta Raghuvanshi, Executive Director, Sales and Marketing, DLF Gateway Tower, Second Floor, DLF City, Phase-III, Gurgaon – 122002, Haryana, India.

..........Opposite Parties.

Argued by:

Sh. Narender Yadav, Advocate for the complainants.

Sh. Arjun Sharma, Advocate for the Opposite Parties.

Complaints under Section 17 of the Consumer Protection Act, 1986.

BEFORE: JUSTICE JASBIR SINGH (RETD.), PRESIDENT.

SH. DEV RAJ, MEMBER.

MRS. PADMA PANDEY, MEMBER.

PER DEV RAJ, MEMBER

By this order, we propose to dispose of aforesaid seven consumer complaints bearing Nos.595, 346, 718, 802, 804, 848, all of 2017 and 11 of 2018.

2. At the time of arguments, Counsel for the Opposite Parties placed on record a detailed chart duly signed, showing in each case detail of the property, date of Agreement, total price, amount received, DLI etc. and further the date when possession was offered etc., which was taken on record.

3. Arguments were heard in common. After hearing arguments on 06.04.2018, we were of the opinion that the facts and issues in law, involved in the above bunch of complaints, by and large, were the same, and therefore, the aforesaid seven complaints could be disposed of, by passing one consolidated order.

4. Under above circumstances, to dictate order, facts are being taken from consumer complaint bearing No.595 of 2017, titled as ‘Mrs. Sunita Dhull & Anr. Vs. DLF Homes Panchkula Pvt. Ltd.’.

5. In brief, the facts are that the Opposite Party developed a Residential Group Housing Project under the name and style of “The Valley” situated in Sector 3, Kalka-Pinjore Urban Complex. The complainants booked a flat in the Valley Project on 30.03.2010 and paid an amount of Rs.4,00,000/-. The Opposite Party entered into an Independent Floor Buyers Agreement (Annexure C-3) on 24.02.2011 whereby independent floor No.DVF-E7/29 SF (Second Floor) with a parking was allotted to the complainants. The total price of the unit was fixed as Rs.32,18,999.69 for the saleable area of 1450 Sq. Feet. It was further stated that after the booking and before execution of the Agreement, the complainants deposited almost Rs.10,00,000/-.

6. As per Clause 11(a) of the Agreement, the possession of the flat was to be delivered within 24 months from the date of execution of the said Agreement. The Opposite Party also published an advertisement dated 13.01.2014 stating that possession would be delivered in 2014 but nothing was done. It was further stated that the Opposite Party also promised to pay the compensation for delaying the possession as per Clause 15 of the Agreement. It was further stated that the Opposite Party has not received any completion certificate from Haryana Country Town Planning Department till date or a calculation certificate from the Govt. Architect, which is in clear violation of Rule 16 of Haryana Development and Regulation of Urban Areas Rules, 1976. It was further stated that the complainants came to know after visiting the project site that the unit, in question, and other amenities/facilities, as promised, were not even ready for possession and much work was still to be done by the Opposite Party. It was further stated that there are no boundary walls, labour is still working in most of the flats and above all, there is no security check on the entry points of the township nor a proper entry gate with a clean approach road is available. It was further stated that the amenities such as community hall, covered stilt parking, yoga centre, proper swimming pool, library, card/carrom room, pool/billiards room and a club house with modern facilities, are not ready. It was further stated that the construction quality is very poor and most of the promised services/amenities/facilities are lacking.

7. It was further stated that possession was offered by the Opposite Party vide letter dated 15.11.2016 (Annexure C-4), after delay of more than 30 months, whereby the Opposite Party arbitrarily increased the area by 157 sq. ft. and charged Rs.2,50,000/- for the said increase, which is unfair trade practice on its part. It was further stated that wrong doings and illegal action of the Opposite Party has caused undue harassment and mental agony to the complainants, for which they are entitled to compensation.

8. Alleging deficiency, in rendering service, and indulgence into unfair trade practice, on the part of the Opposite Party, the complainants filed the instant complaint under Section 17 of the Consumer Protection Act 1986 (in short 1986 Act) seeking directions to the Opposite Party, to hand over physical and legal possession of the unit, in question, complete in all respects in accordance with the allotment letter and Agreement and with all promised facilities and amenities; to obtain all due permissions and certificates including the Completion Certificate inter-alia from the concerned authorities; pay interest calculated @24% per annum on the deposited amount from the date of delay in handing over of the possession till the date possession is handed over to the complainants; to pay compensation @Rs.10/- per sq. feet of the saleable area as per Clause 15 of the Agreement; award compensation of Rs.5,00,000/- on account of causing financial risk, hardship, mental agony, harassment, emotional disturbance caused to the complainant due to the actions/omissions of Opposite Party; Rs.75,000/- as litigation expenses; and grant any other relief which this Commission deems fit and proper under the facts and circumstances of the present case.

9. The Opposite Party, in its preliminary submissions in the written statement admitted that the complaint has become infructuous as offer of possession was sent to the complainants on 15.11.2016 but neither the complainants are taking possession nor paid the due amount as raised in FSA dated 15.11.2016. It was further stated that instant complaint has been filed in total disregard to the terms of Floor Buyer’s Agreement executed between the parties. It was further stated that the complainants had full knowledge about the executed terms of Independent Floor Buyer’s Agreement dated 24.02.2011. It was further stated that the project was cost escalation free as the complainants have been getting benefit of cost escalation on account o construction material/labour cost & also price appreciation. It was further stated that there has been exit option offered by the Opposite Party vide letter dated 05.06.2013 at the time of construction stayed by Court. It was further stated that occupation certificate was received on 19.07.2016 and possession was offered on 15.11.2016. It was further stated that the complainants prayed for unfounded demands, which were not as per executed terms of the Agreement and thus, the Opposite Party has prayed to allow 31% cost escalation of construction as well as 47% of the land holding cost. It was further stated that construction of the project got delayed due to stay on construction, ordered by the High Court and thereafter by Hon’ble Supreme Court of India due to third party litigation involving acquisition proceedings of land of litigants therein, in the years 2010 and 2012. It was further stated that after dismissal of the said litigation by Hon’ble Supreme Court on 12.12.2012, the Opposite Party vide letter dated 05.06.2013 (Annexure R-3) offered an exit option to the complainants by accepting the refund of their entire amount paid till date with 9% interest but they refused to avail the said exit option and consented to the extension of time.

10. In regard to present status of the project, it was stated that occupation certificate(s) of 1775 units had already been received and possession to 1707 customers has been offered and more than 653 allottees have already taken possession. It was also stated that proper water connection and electricity supply was in place and housekeeping and maintenance services were being provided through leading multinational company, namely, Jones Lang Lasalle.

11. In the preliminary objections, it was stated that the parties were bound by the terms and conditions mentioned in the Independent Floor Buyer’s Agreement; that the complainants have made baseless allegations of unfair trade practice, deficiency in service etc. with an ulterior motive to amend/modify/rewrite the concluded Agreement duly executed between parties, purely to invoke jurisdiction of this Commission; that this Commission cannot adjudicate upon the matter where the prima facie prayers are for modification of clauses of the Agreement; that the complainants are not consumers as the floor, in question, was purchased by them for investment purposes and earning profits. An objection was also raised that this Commission did not have the territorial jurisdiction to entertain and try the present complaint in as much as the parties agreed to exclude the jurisdiction of all other Courts except the Courts at Panchkula and High Court of Punjab & Haryana. Further, an objection was also raised in the written statement that as per Clause 55 in the Agreement, all disputes arising out of the Agreement are to be settled amicably, failing which, they shall be referred to the Arbitration. It was further stated that the Opposite Party could not be made liable for delay caused due to force majeure conditions, which was on account of stay by Hon’ble Punjab & Haryana High Court and Hon’ble Supreme Court of India from 06.04.2010 to 23.07.2010 and from 19.04.2012 to 12.12.2012 and delay in grant of approvals in layout plans and service plans. In Sub Para (g) of Para 11 of the preliminary objections, it was further stated that approvals regarding revision in layout plan and service plans sought on 11.3.2013 and 20.05.2013, were received on 06.09.2013 and 14.08.2014 respectively. It was also stated that when given the option to exit vide letter dated 05.06.2013, the complainants agreed to continue with allotment and delay and, as such, they (complainants) voluntarily waived of their right to raise any grievance.

12. The Opposite Parties moved Miscellaneous Applications under Sections 5 and 8 of Arbitration and Conciliation Act, 1996, for referring the matter to the sole arbitration, in the following complaints:-

Sr. No.	Complaint No.	Miscellaneous Application No.
1.	346/2017	681/2017
2.	718/2017	67/2018
4.	802/2017	113/2018
5.	804/2017	111/2018

The aforesaid applications were disposed of by this Commission by holding that the applicability of the arbitration process would be seen at the time of final arguments in the main case.

13. On merits, it was stated that the price of the property as per SOP is Rs.35,40,080.10 plus service tax for 1450 sq. ft. It was further stated that due to increase in the area, the total price of the property was Rs.39,92,030.61 plus service tax for an area of 1575 sq. ft. It was further stated that till date, the complainants have deposited a sum of Rs.32,48,855.80 and there is a DLI of Rs.20,655.80 levied against the account of the complainants for a delay of 173 days in remitting installments. It was admitted that as per Clause 11(a) of the Agreement, possession of the allotted unit, was to be handed over to the complainants within 24 months from the date of signing of the Agreement subject to force majeure conditions or due to reasons beyond the control of the Opposite Party as mentioned in Clauses 11(b) and 11(c) of the Agreement. It was further stated that there was stay on construction in furtherance to the direction passed by Hon’ble Supreme Court vide order dated 19.04.2012 in SLP No.21786-88/2010, which was vacated only on 12.12.2012. It was further stated that increase in area was only of 13% i.e. less than 15%, which was as per Clauses 9 and 10 of the Agreement and, therefore, no consent of the complainants was required. It was further stated that all the amenities i.e. roads, sewer, parks, power backup, club and restaurant, for comfortable stay, are in place. It was reiterated that the Opposite Party offered possession of the unit, in question, to the complainants vide letter dated 15.11.2016 and requested them to remit the outstanding dues and furnish the documents in order to facilitate the conveyance of the said unit. It was further stated that demands have been raised by the Opposite Party as per terms and conditions of the Agreement. It was further stated that neither there was any deficiency, in rendering service, on the part of the Opposite Party nor it indulged into any unfair trade practice. The remaining averments, were denied, being wrong.

14. The complainants, in support of their case, submitted affidavit of Mrs. Sunita Dhull, complainant No.1, by way of evidence, alongwith which, a number of documents were attached.

15. The Opposite Party, in support of its case, submitted the affidavit of Sh. Shiv Kumar, its Authorized Signatory, by way of evidence, alongwith which, a number of documents were attached.

16. We have heard the Counsel for the parties, and have gone through the evidence and record of the case, carefully.

17. It is evident that vide allotment letter dated 03.04.2010 (at Page 264 of the written statement), the complainants were allotted Independent Floor No.DVF-E7/29-SF#217 in DLF Valley, Panchkula and Independent Floor Buyer’s Agreement was executed between them and the Opposite Party on 24.02.2011 [Annexure C-3/R-5 (colly.)]. The total price of the said independent floor, as depicted in the Agreement, was Rs.32,18,999.69, besides other charges, securities, deposits and taxes etc. as specified in the Application/Agreement. In all, a sum of Rs.32,48,855.80 has actually been paid to the Opposite Party, as admitted in the written statement and as mentioned in the Chart showing details of the property etc., in question, placed on record, under the signatures of the Counsel for the Opposite Party, at the time of arguments on 06.04.2018. As per Clause 11(a) of the Agreement, the Opposite Party was to complete the construction of the said independent floor within a period of 24 months from the date of execution of the said Agreement. It may be stated here that in view of stay by Hon’ble Supreme Court, the Opposite Party gave option on 05.06.2013 to the complainants to seek refund alongwith 9% interest or to continue with the allotment by agreeing to extend one year period for delivery of possession (Annexure R-3 at Page 99 of the written statement). It is a fact that there was stay by the Hon’ble Supreme Court of India from 19.04.2012 to 12.12.2012 (Annexures R-8 & R-9), which in turn, delayed the completion of the project. The Opposite Party has claimed that this being a force majeure condition, it is entitled to benefit of delay of one year. The possession of the unit, in question, was offered by the Opposite Party to the complainants on 15.11.2016 vide offer of possession letter (Annexure C-4/R-2 colly.) and the instant complaint has been filed on 08.08.2017.

18. As regards averment of the complainants regarding poor quality construction, no cogent evidence/expert evidence by way of report of an Engineer/Architect, to substantiate the allegation, has been brought in evidence.

19. The Opposite Party, in preliminary submissions, has prayed to allow it 31% cost escalation of construction as well as 47% of the land holding cost, totaling 76% of the sale price. There is a clear and specific stipulation in Clause 1.2 of the Agreement that price of the unit is escalation free. Since the Opposite Party failed to complete construction and deliver possession within stipulated period and extended one year period, it (Opposite Party) is itself responsible for delay and deficiency in service. Its prayer for allowing it escalation cost of construction as well as land holding amounts to seeking amendment of the terms and

conditions of the Agreement and the same being devoid of merit, must fail, and the same stands rejected.

20. The Independent Floor Buyer’s Agreement, in the instant case, was executed between the parties on 24.02.2011 and period stipulated therein for handing over possession was to commence from the date of execution of the same (Agreement), as such, the averment of the Opposite Party that Hon’ble Punjab & Haryana High Court had restrained it from creating any third party rights, during the year 2010 (06.04.2010 to 23.07.2010) (Annexure R-6 & R-7), is not relevant.

21. It may be stated here that in this complaint, the complainants, have specifically challenged demand qua increase in area of the unit, in question. As is evident from record, the saleable area of the unit, in question, as per the Agreement was 1450 sq. ft. While offering possession, in the final statement of account, annexed with the possession letter dated 15.11.2016, it was mentioned that the final area of the unit was 1575 sq. ft. Thus, there was increase of 125 sq. ft. When compared with the original area of the unit viz. 1450 sq. ft., the increase is less than 15% and consent of complainants was not required. The complainants came to know about change in the area when possession was offered to them on 15.11.2016. In case, the complainants had any grievance regarding increase in area, in terms of Clause 10 of the Agreement, they could raise objections within 30 days. There is nothing on record to show that the complainants raised any objection during the period of 30 days or till filing of the complaint on 08.08.2017. The complainants have also not adduced any evidence by way of report of an Engineer/Architect that increase in area did not exist. The demand raised by the Opposite Party to this effect, is, thus, legal and tenable and the complainants are liable to pay the same. Otherwise also, the issue qua demand raised on account of increased area and other demands raised in the offer of possession letter has already been settled by this Commission in Consumer Complaint bearing No.32 of 2017 titled Kavita Devi Vs. M/s DLF Homes Panchkula Pvt. Ltd. decided on 17.05.2017 alongwith which, 12 connected complaints were also decided. The view held in Kavita Devi’s case (supra) qua demands raised holds good in this case also and also in all the connected cases (except complaint case No.718 of 2017), wherein the complainant has sought refund of the deposited amount.

22. The Opposite Parties, moved Miscellaneous Applications Under Order 1 Rule 10 (2) of Code of Civil Procedure for striking off the names of Director(s) from the array of the Parties, in the following complaint cases:-

Sr. No.	Case No.	Miscellaneous Application No.
1.	802/2017	103/2018
2.	718/2017	66/2018
3.	804/2017	104/2018

For disposal of these applications, we are referring to Miscellaneous Application bearing No.103 of 2018 filed by Counsel for the Opposite Parties in Consumer Complaint bearing No.802 of 2017. In the application, it has been stated that neither any averment against Opposite Parties No.2 & 3, who are Directors of Opposite Party No.1 – Company, has been made by the complainants nor the complainants have claimed any relief against the said Opposite Parties viz. Opposite Parties No.2 & 3. It was further stated that the Directors perform acts and duties for the benefit of the Company and are agents of the company to the extent that they have been authorized to perform certain acts on behalf of the Company and as such, they owe no fiduciary or contractual duties or any duty of care to third party with the Company. It has been prayed that they not being a necessary and proper party, their names be struck off from the array of the parties.

It may be stated here that Opposite Party No.1 being a private limited company was not to act itself and was to act through its Managing Director and/or Directors.

In Sanjay K. Malviya Vs Sidhharth Enterprises & Anr. I (2008)CPJ 74(NC), it was held that the provisions under Section 27 of the Act could be applied to the Directors of the Companies, notwithstanding the absence of specific provision, for action against those in-charge of the affairs of the Company. It was further held that impleadment of the Directors of the Company, as parties, in addition to the Company, in the consumer complaint was not necessary. It was further held that the orders passed by the Foras below, against the Company were binding on the Managing Director and the Directors of the Company.

In Mr. Tonse N.M. Pai Vs. All Goa Manipal Finance Group of Companies Creditors Association, 2013 (1) CCC 420 (NS) a similar question, arose for decision,. The National Consumer Disputes Redressal Commission, New Delhi, held that a Company acts through its Board of Directors, at the meetings. It is managed through its Managing Director or its Directors. It was held that he cannot contend, in the proceedings under Section 27 of the Act, that only the Company was liable to be penalized. It was further held that contrary view could only defeat the provisions of Section 27 (1) of the Act, which was enacted for greater protection of the interests of the consumers, by way of additional remedy.

In Byford Leading Ltd. Vs. Union of India (57) (1995) DLT 623, which was followed in Ravikant and another Vs. National Consumer Disputes Redressal Commission and others (1997 (2) CPR 65), a Division Bench of the Delhi High Court, held that under Section 27 of the Act, the Chairman and the Managing Director of the Company can be proceeded against, they being in-charge of the management and in control of the affairs of the Company. In Ravikant and another's case (supra), a Division Bench of the Delhi High Court, referred to the un-amended Contempt of Courts Act, 1962 and the decision of the Apex Court, in The Aligarh Municipal Board vs Ekka Tonga Mazdoor Union and Ors (AIR 1970 SC 1767) and held that a penal provision in Section 27 of the Act, which is applicable to a Company, must be treated as applicable to those whose are officially responsible for the conduct of its affairs. In Ravikant and another's case (supra), there were two petitioners, who were the Directors of each of the Companies. Under these circumstances, it was held that the penal provisions of Section 27 of the Act, could be applied to the Directors of the Companies, notwithstanding the absence of the specific provision, for action against those in charge of or in control of the affairs of the Company. This conclusion could also be reached by invoking the principle of lifting of corporate veil.

Further, in Ashish Ramesh Chandra Birla & Ors.Vs Murlidhar Rajdhar Patil & Ors. I (2009) CPJ 200 (NC), a consumer complaint was filed against Siddhi Vyankatesh Urban Co-operative Credit Society Ltd. Jalgaon, that some amount was invested with it, in a Scheme launched by it, but it failed to pay the same, on maturity. The National Consumer Disputes Redressal Commission, held that the Directors of the Society, were jointly and severally liable to pay the amount of maturity and were rightly held to be deficient, in rendering service, by the Foras below. The principle of law, laid down, in the aforesaid cases, is fully applicable to the instant case.

Not only this, in case titled M/s India Bulls Real Estate & Wholesales Services Ltd. & Ors. Vs. Vemparalasrikant & Anr., First Appeal No.797 of 2017, Hon'ble National Consumer Disputes Redressal Commission, New Delhi while dismissing the said appeal on 16.08.2017, held in Para 5, interalia, as under:-

“5. From the material on record, it is evident that the OP-2 is the Chairman of the Company whereas the OP-3 is the Chief Executive Officer-cum-M.D. of the said company. Evidently, these two persons are holding such important positions in the Company, where they are directly involved with the decision-making process in the company. By virtue of their office, they can directly influence any decision regarding relief to be granted to the complainant, as asked for in the consumer complaint. It is held, therefore, that the State Commission has rightly dismissed the interim application, rejecting the plea of the appellants to delete the name of OP-2 & OP-3 from the array of parties……..”

It clearly emerges from the ratio of aforesaid judgments that the Managing Director and/or Directors are responsible and can be penalized under Section 27 of Consumer Protection Act, 1986.

In the instant case, the complainants have only impleaded Opposite Parties No.2 & 3 as a party and by doing so, they (Opposite Parties No.2 & 3) have been afforded an opportunity to project their defence. By moving this application, raising hollow and technical pleas, an attempt has been made to wriggle out of their liability and responsibility. The fact of Opposite Parties No.2 & 3, being Directors of the Company, has neither been disputed nor has it been pleaded that they are not the active Directors of the Company. In view of aforesaid position, for failure of Opposite Party No.1, they (Opposite Parties No.2 & 3) are also equally responsible. The objection raised, thus, being not sustainable, stands rejected. Accordingly, the aforesaid applications also stand dismissed.

23. The first question, that falls for consideration, is, as to whether, in the face of existence of arbitration clause in the Agreement, to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of 1996 Act, this Commission has no jurisdiction to entertain the consumer complaint. It may be stated here that this Commission in case titled ‘Sarbjit Singh Vs. Puma Realtors Private Limited’, IV (2016) CPJ 126, noted that litigation in the Consumer Fora is cost effective. The complaint in the State Commission can be filed by making payment between Rs.2,000/- to Rs.4,000/- only. Whereas, as per principal Act (1996 Act),

the consumer will be forced to incur huge expenses towards his/her share of arbitrator’s fee. As per mandate of 1986 Act, a complaint is proposed to be decided within three months from the date of service of the other party. On the other hand, it is admissible to an Arbitrator to decide a dispute within one year. Thereafter, the Court wherever it is challenged may also take upto one year and then there is likelihood that the matter will go to the High Court or the Hon'ble Supreme Court of India. Such an effort will be a time consuming and costly one. Taking note of fee component and time consumed in arbitration, it was observed that if the matter is referred to an Arbitrator, it would defeat the very purpose of the provisions of 1986 Act. Paras 26, 33 and 34 of the said order, inter-alia, being relevant, are extracted hereunder:-

“26. To decide above said question, it is necessary to reproduce the provisions of Section 3 of the Consumer Protection Act 1986 (in short the Act), which reads as under;

“3. Act not in derogation of any other law.—

The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force.”

33. The 1986 Act provides for better protection of interests and rights of the consumers. For the said purpose, the Consumer Foras were created under the Act. In Section 3 of 1986 Act, it is clearly provided that the said provision is in addition to and not in derogation of any provisions of any other law, for the time being in force. The 1986 Act is special legislation qua the consumers. The poor consumers are not expected to fight the might of multinational companies/traders, as those entities have lot of resources at their command. As stated above, in the present case, the complainant has spent his entire life earnings to purchase the plot, in the said project, launched by the opposite party. However, his hopes were shattered, when despite making substantial payment of the sale consideration, he failed to get possession of the plot, in question, in a developed project. As per ratio of the judgments in the case of Secretary, Thirumurugan Cooperative Agricultural Credit Society v. M. Lalitha (2004) 1 SCC 305 and United India Insurance Co. Ltd. Vs. M/s Pushpalaya Printers, I (2004) CPJ 22 (SC), and LIC of India and another Vs. Hira Lal, IV (2011) CPJ 4 (SC), the consumers are always in a weak position, and in cases where two interpretations are possible, the one beneficial to the consumer needs to be accepted. The opinion expressed above, qua applicability of Section 8 (amended) of 1996 Act, has been given keeping in mind the above said principle.

34. Not only this, recently, it was also so said by the National Commission, in a case titled as Lt. Col. Anil Raj & anr. Vs. M/s. Unitech Limited, and another, Consumer Case No.346 of 2013, decided on 02.05.2016. Relevant portion of the said case, reads thus:-

“In so far as the question of a remedy under the Act being barred because of the existence of Arbitration Agreement between the parties, the issue is no longer res-integra. In a catena of decisions of the Hon’ble Supreme Court, it has been held that even if there exists an arbitration clause in the agreement and a Complaint is filed by the consumer, in relation to certain deficiency of service, then the existence of an arbitration clause will not be a bar for the entertainment of the Complaint by a Consumer Fora, constituted under the Act, since the remedy provided under the Act is in addition to the provisions of any other law for the time being in force. The reasoning and ratio of these decisions, particularly in Secretary, Thirumurugan Cooperative Agricultural Credit Society Vs. M. Lalitha (Dead) Through LRs. & Others - (2004) 1 SCC 305; still holds the field, notwithstanding the recent amendments in the Arbitration and Conciliation Act, 1986. [Also see: Skypak Couriers Ltd. Vs. Tata Chemicals Ltd. - (2000) 5 SCC 294 and National Seeds Corporation Limited Vs. M. Madhusudhan Reddy & Anr. - (2012) 2 SCC 506.] It has thus, been authoritatively held that the protection provided to the Consumers under the Act is in addition to the remedies available under any other Statute, including the consentient arbitration under the Arbitration and Conciliation Act, 1986.”

Same is the ratio of judgment of a three Judges Bench of the National Commission in a case titled as Aftab Singh Vs. Emaar MGF Land Limited & Anr., Consumer Case No. 701 of 2015, vide order dated 13.07.2017.

Against the aforesaid order passed by the larger Bench of the Hon'ble National Consumer Disputes Redressal Commission, New Delhi, M/s Emaar MGF Land Limited filed Civil Appeal No.(s) 23512-23513 of 2017 in Hon’ble Supreme Court of India, which were also dismissed.

In view of the above, the plea taken by the Opposite Party, that in the face of existence of arbitration clause in the Agreement, to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of 1996 Act, this Commission has no jurisdiction to entertain the consumer complaint, being devoid of merit, is rejected.

24. In regard to other preliminary objections raised by the Opposite Party, in its written statement, as referred to in Para 11 above, the following questions fall for consideration:-

(i) Whether as per Clause 55 of the Agreement, the Courts at Panchkula alone and the Punjab and Haryana High Court at Chandigarh, shall have Jurisdiction, to entertain and adjudicate the complaint, and, as such, the Jurisdiction of this Commission was barred. It may be stated here that this issue has already been dealt with in detail by this Commission in case titled “Kapil Kumar Khosla & Ors. Vs. DLF Homes Panchkula Private Limited & Ors.’, 2017 (3) CPJ 8, wherein in Para 21 and 22, this Commission held as under:-

“21. ……..It was stated that since the project of the Opposite Parties is situated in District Panchkula and possession of the floor was to be delivered in Panchkula, a part of cause of action arose at Panchkula. According to Section 17 of the Act, a consumer complaint can be filed, by the complainants, before the State Consumer Disputes Redressal Commission, within the territorial Jurisdiction whereof, a part of cause of action arose to him. Clearly, application for allotment of Unit (Page 80 of written statement) was made by the complainants at Chandigarh address viz. Shop No.101-102, Ist Floor, DLF City Centre Mall, Rajiv Gandhi, I.T. Park, Kishangarh, Chandigarh. Independent Floor Buyer's Agreement (Annexure C-2) was also executed between the parties on 03.02.2011 at Chandigarh. Since, as per documents, referred to above, a part of cause of action arose to the complainants, at Chandigarh, this Commission has got territorial Jurisdiction to entertain and decide the complaint. It may be stated here that all the provisions of the Code of Civil Procedure are not applicable, except those, mentioned in Section 13 (4) of the Act, to the proceedings, in a Consumer Complaint, filed under the Act. For determining the territorial jurisdiction, to entertain and decide the complaint, this Commission is bound by the provisions of Section 17 of the Act. In Associated Road Carriers Ltd., v. Kamlender Kashyap & Ors., I (2008) CPJ 404 (NC), the principle of law, laid down, by the National Commission, was to the effect, that a clause of Jurisdiction, by way of an agreement, between the Parties, could not be made applicable, to the Consumer Complaints, filed before the Consumer Fora. It was further held, in the said case, that there is a difference between Sections 11/17 of the Act, and the provisions of Sections 15 to 20 of the Civil Procedure Code, regarding the place of jurisdiction. In the instant case, as held above, a part of cause of action arose to the complainants, within the territorial Jurisdiction of this Commission, at Chandigarh. In Ethiopian Airlines v. Ganesh Narain Saboo, IV (2011) CPJ 43 (SC) : VII (2011) SLT 371, the principle of law, laid down, was that the restriction of Jurisdiction to a particular Court, need not be given any importance in the circumstances of the case.

22. In Cosmos Infra Engineering India Ltd. v. Sameer Saksena & another I (2013) CPJ 31 (NC) and Radiant Infosystem Pvt. Ltd. & Others v. D. Adhilakshmi & Anr I (2013) CPJ 169 (NC) the agreements were executed, between the parties, incorporating therein, a condition, excluding the Jurisdiction of any other Court/Forum, in case of dispute, arising under the same, and limiting the Jurisdiction to the Courts/Forums at Delhi and Hyderabad. The National Commission, in the aforesaid cases, held that such a condition, incorporated in the agreements, executed between the parties, excluding the Jurisdiction of a particular Court/Forum, and limiting the Jurisdiction to a particular Court/Forum, could not be given any importance, and the complaint could be filed, at a place, where a part of cause of action arose, according to Sections 11/17 of the Act. The principle of law, laid down, in the aforesaid cases, is fully applicable to facts of the instant case. It may also be stated here, that even if, it is assumed for the sake of arguments, that the complainants had agreed to the terms and conditions of the agreement, limiting the Jurisdiction to the Courts, referred to above, the same could not exclude the Jurisdiction of this Commission, at Chandigarh, where a part of cause of action accrued to the complainants, to file the complaint. The submission of the Opposite Parties, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected.”

In the instant case also, application for allotment of Unit (Annexure R-4, at Page 100 of the written statement) was made by the original allottees at Chandigarh address of the Opposite Parties viz. Shop No.101-102, Ist Floor, DLF City Centre Mall, Rajiv Gandhi, I.T. Park, Kishangarh, Chandigarh and as admitted, Independent Floor Buyer’s Agreement was also executed between the parties on 24.02.2011 at Chandigarh. Since, as per documents, referred to above, a part of cause of action arose to the complainants, at Chandigarh, this Commission has got territorial Jurisdiction to entertain and decide the complaint. The objection raised by the Opposite Party, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected.

(ii) The next objection raised by the Opposite Party is that the complainants have made baseless allegations of unfair trade practice, deficiency in service etc. with an ulterior motive to amend/modify/rewrite the concluded Agreement duly executed between the parties, purely to invoke jurisdiction of this Commission and further the complainants were virtually inviting this Commission to assume powers conferred under the Civil Court and, therefore, this Commission did not have the jurisdiction to consider the present complaint. This issue has also been dealt with by this Commission in Kapil Kumar Khosla & Ors. Vs. DLF Homes Panchkula Private Limited & Ors.’s case (supra), in Paras 23 and 24, which read thus:-

“23. …….It may be stated here, that the complainants hired the services of the Opposite Parties, for purchasing the flat, in question, in the manner, referred to above. According to Clause 11(a) of the Agreement, subject to force majeure conditions and reasons, beyond the control of Opposite Parties, they were to complete construction of the said Independent Floor within a period of twenty four months, from the date of execution of the same (Agreement). Section 2 (1) (o) of the Act, defines 'service' as under:-

"service" means service of any description which is made available to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service"

24. From the afore-extracted Section 2(1)(o) of the Act, it is evident that housing/construction, also comes within the definition of a service. In Narne Construction P. Ltd., etc. etc. v. Union Of India and Ors. Etc., II (2012) CPJ 4 (SC), it was held that when a person applies for the allotment of a building or site or for a flat constructed by the Development Authority and enters into an agreement with the Developer, or the Contractor, the nature of transaction is covered by the expression 'service' of any description. Housing construction or building activity carried on by a private or statutory body constitutes 'service' within the ambit of Section 2(1)(o) of the Act. Similar principle of law, was laid down, in Haryana Agricultural Marketing Board v. Bishambar Dayal Goyal & Ors. (AIR 2014 S.C. 1766). Under these circumstances, the complaint involves the consumer dispute, and the same is maintainable. Not only this, as stated above, Section 3 of the Act, provides an alternative remedy. Even if, it is assumed that the complainants have the remedy to file a suit in the Civil Court, the alternative remedy provided under Section 3 of the Act, can be availed of by them, as they fall within the definition of a 'consumer', as stated above. In the instant case, the complainants are seeking relief on account of violation of terms and conditions of the Agreement by the Opposite Parties and their deficiency in rendering service. It, therefore, cannot be said that the complainants are trying to rewrite/modify the terms of the Agreement. Such an objection, taken by the Opposite Parties, in their written reply, therefore, being devoid of merit, is rejected.”

The objection, taken by the Opposite Party, in its written reply, therefore, being devoid of merit, is rejected.

(iii) Another objection raised by the Opposite Party is that since the complainants purchased the flat, in question, for earning profits i.e. for resale, as and when there was escalation in the prices of real estate, as such, they would not fall within the definition of ‘consumer’, as defined by Section 2 (1) (d) (ii) of the Act. Qua this issue, this Commission in Kapil Kumar Khosla & Ors. Vs. DLF Homes Panchkula Private Limited & Ors.’s case (supra), in Para 25 held as under:-

“25. ……….It may be stated here that there is nothing, on record to show, that the complainants are property dealer(s), and are indulged in sale and purchase of property, on regular basis. In the absence of any cogent evidence, in support of the objection raised by the Opposite Parties, mere bald assertion to that effect, cannot be taken into consideration. Rather, the complainants in their complaint, have clearly stated that they purchased the flat, in question, solely for residential purposes. Otherwise also, in a case titled as Kavita Ahuja v. Shipra Estate Ltd. and Jai Krishna Estate Developer Pvt. Ltd., 2016 (1) CPJ 31, it was held by the National Consumer Disputes Redressal Commission, New Delhi, that the buyer(s) of the residential unit(s), would be termed as consumer(s), unless it is proved that he or she had booked the same for commercial purpose. The principle of law, laid down, in Kavita Ahuja's case (supra) is fully applicable to the present case. Under these circumstances, by no stretch of imagination, it can be said that the unit, in question, was purchased by the complainants, by way of investment, with a view to earn profit, in future. Similar view was reiterated by the National Commission, in DLF Universal Limited v. Nirmala Devi Gupta, 2016 (2) CPJ 316. Not only above, recently under similar circumstances, in a case titled as "Aashish Oberai v. Emaar MGF Land Limited", Consumer Case No. 70 of 2015, decided on 14 Sept. 2016, the National Commission, while rejecting similar plea raised by the builder, observed as under:-

"In the case of the purchase of the house 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. In fact, this was also the view taken by this Commission in Rajesh Malhotra & Ors. v. Acron Developers Pvt. Ltd. & Ors. First Appeal No. 1287 of 2014 decided on 05.11.2015."

The complainants, thus, fall within the definition of 'consumer', as defined under Section 2(1)(d) of the Act. Such an objection, taken by the Opposite Parties, in their written reply, therefore, being devoid of merit, is rejected.”

Undoubtedly, the complainants purchased the flat, in question, for their residential purposes as they have sought possession of the same.

In view of above, the complainants fall within the definition of ‘consumer’, as defined under Section 2(1)(d) of the Act and as such, the objection raised by the Opposite Party, in its written reply, being devoid of merit, is rejected.

(iv) It was argued by the Counsel for the Opposite Party that the complainants, when given the option to seek refund with 9% simple interest, agreed to continue with allotment and also agreed to delay and, as such, they waived of their right to raise any grievance. While dealing with this issue, this Commission in Kapil Kumar Khosla & Ors. Vs. DLF Homes Panchkula Private Limited & Ors.’s case (supra), held in Para 26 as under:-

“26……..This plea of the Opposite Parties is not well based. While seeking option vide letter dated 05.06.2013, the complainants were informed of delay and extension of one year was sought. One year extended period expired on 02.02.2014 whereas the possession was offered on 15.11.2016. Had the Opposite Parties handed over possession before the stipulated period of two years in the Agreement plus one year extended period i.e. by 02.02.2014, position would have been different and in that situation, it would have been accepted that the complainants had waived of their right to raise grievance. The plea being devoid of merit is not tenable.”

In this instant case also, exit option was given to the complainants vide letter dated 05.06.2013 (Anneure R-3 at page 99 of the written statement) but possession was not delivered even within the extended one year period. Therefore, in the light of observation made by this Commission, as extracted above, the objection raised is not tenable.

25. The next question, that falls for consideration, is, as to whether, there is delay in offering/delivering possession of the flat, in question. Clauses 11(a) & 11(b) of Independent Floor Buyer’s Agreement dated 24.02.2011 read thus:-

“11(a) Schedule for possession of the said Independent Floor:-

The Company based on its present plans and estimates and subject to all just exceptions, endeavors to complete construction of the said Independent Floor within a period of twenty four (24) months from the date of execution of the Agreement unless there shall be delay or failure due to Force majeure conditions and due to reasons mentioned in Clause 11(b) and 11(c) or due to failure of Allottee to pay in time the Total Price and other charges, taxes, deposits, securities etc and dues/payments or any failure on the part of the allottee to abide by all or any of the terms and conditions of this Agreement.

11(b) Delay due to reasons beyond the control of the company:-

If the possession of the Said Independent Floor is delayed due to Force Majeure conditions, then the company shall be entitled to extension of time for delivery of possession of the said Independent Floor. The company during the continuance of the Force Majeure reserves the right to alter or vary the terms and conditions of the agreement or if the circumstances so warrant, the company may also suspend the development for such period as is considered expedient and the allottee shall have no right to raise any claim compensation of any nature whatsoever for or with regard to such suspension……..”

As stated above, according to Clause 11(a) of the Agreement, subject to force majeure conditions and reasons, beyond the control of the Opposite Party, it was liable to deliver physical possession of unit, within a period of 24 months, from the date of execution of the same (Agreement). In the event of failure to deliver possession, as per Clause 15 of the Agreement, the complainants were entitled to get penal compensation @Rs.10/- per square feet, per month, of the saleable area, for the period of delay. It is true that in some litigation, the Hon’ble Supreme Court of India stayed construction at the project site and order passed remained in force from 19.04.2012 up-to 12.12.2012 i.e. for about 8 months. It is also admitted that above fact of granting stay resulted into delay in construction at the site.

26. The Opposite Party has specifically pleaded that there was stay by the Hon’ble Apex Court from 19.04.2012 up-to 12.12.2012 (Annexures R-8 & R-9), which in turn delayed the project. In view of this, the two years period stipulated in the Agreement and one year extended period on account of stay by the Hon’ble Apex Court, expired on 23.02.2014. No justification whatsoever for delay in offering possession beyond 23.02.2014 has been explained by the Opposite Party. The argument of the Opposite Party that delay in handing over possession of independent floor was attributable due to delay in receiving statutory approvals from the competent authorities, the same being absolutely beyond its control, is not tenable. The Independent Floor Buyer’s Agreement was executed on 24.02.2011 and before execution thereof, the Opposite Party ought to have obtained all the approvals. If permissions/approvals for revision in layout plans and service plans were sought on 11.03.2013 and 20.05.2013, approvals for which were also received in due course of time, the initial time taken (more than two years) for seeking such approvals amounts to clear deficiency on the part of the Opposite Party and in the absence of any justified reason for not doing so earlier, time consumed in obtaining such approvals would not amount to force majeure condition. The plea taken, therefore, is of no help to the Opposite Party. Possession of the unit, in question, having been offered vide offer of possession letter dated 15.11.2016, clearly, there is inordinate delay (around 2 years 8 months 23 days) in offering possession of the unit, in question, to the complainants. Delay in offering possession to the complainants is an act of clear deficiency of the Opposite Party.

27. It may be stated here that while offering possession vide letter dated 15.11.2016, the Opposite Party raised a demand of Rs.8,09,375.63 i.e. (Rs.7,26,609.63 + Rs.82,766.00), which included contingent deposit of Vat of Rs.22,916/-. It may be stated here that against the demand raised, the complainants have deposited only an amount of Rs.2,01,778.00 i.e. [Rs.1,82,659.00 plus service tax of Rs.17,847/- plus Rs.636/- each as SBC & KKC] vide receipt dated 22.03.2017 (at Page 45 of the complaint). Apart from aforesaid amount of Rs.2,01,887.00, the complainants also deposited an amount of Rs.82,766.0 towards Valley Residents Welfare Society vide the aforesaid receipt. The fact is that the complainants did not deposit the complete payment. The requisite documents have also not been executed/submitted by the complainants to the Opposite Party and, as such, possession of the unit, in question, has not been delivered to them (complainants) till date by the Opposite Party.

28. The next question, that falls for consideration, is, as to whether, the complainants are entitled to compensation, if so, at what rate, for non-delivery of physical possession of the unit, in question, within the stipulated period of 24 months and extended period of 12 months on account of force majeure conditions. As stated above, in the instant case, the Opposite Party did not deliver possession within 24 months as stipulated in Independent Floor Buyer’s Agreement and thereafter within extended period of 12 months, from execution of the Agreement on 24.02.2011 i.e. by 23.02.2014. As already stated above, possession of the unit, in question, was offered by the Opposite Party on 15.11.2016. There is, thus, inordinate delay of around 2 years 8 months 23 days, even beyond the extended period. Clearly there is delay in offering possession on account of which, the complainants deserve to be compensated. It may be stated here that a two Judges Bench of Hon’ble National Commission in the case of Shri Suman Nandi & Anr. Vs. M/s Unitech Limited & Anr., Complaint No.277 of 2013, decided on 17.12.2015, where there was delay in delivering possession, in Para 16 held as under:-

“16. On perusal of the Buyer’s Agreement and the affidavits filed by the parties it is clear that the complainants had booked the subject apartments on the expressed promise extended by the opposite parties that subject to Force Majeure, the opposite parties would deliver the possession of the apartments complete in all respect within 30-36 months, as the case may be, of the execution of the Buyers Agreement and being influenced by the said promise the complainants entered into the contract. No doubt in the Buyer’s Agreement some scope for delay due to unavoidable circumstances was kept in mind for which clause 4.a. for compensating the complainants for delay was incorporated but it does not mean that the intention was that even in the event of inordinate delay in completing the construction and delivering the possession, the complainants would be entitled to meagre compensation of Rs.5/- per sq. ft. per month which is much less than the bank rate for loan or fixed deposit. Therefore, in our considered view clause 4.a. was meant for computing compensation in case of a minor delay in delivery of possession. If the argument of the opposite party is to be accepted, it would lead to absurd situation and would give an unfair advantage to the unscrupulous builder who might utilize the consideration amount meant to finance the project by the buyer for his other business venture at nominal interest of 2-3 per cent as against much higher bank lending rates. This could never be the intention of legislation that if such a proposition is accepted, it would result in defeating the object of Consumer Protection Act.”

The National Commission granted 12% interest as compensation from the date of default in delivery of possession.

Also in Capt. Gurtaj Singh Sahni & anr. Vs Manager, Unitech Limited & anr., consumer complaint bearing no.603/2014, decided on 02.05.2016, the Hon’ble National Commission, directed the opposite party/builder to pay interest on the deposited amount, for the period of delay, till delivery of possession of the unit. Relevant contents of the said order read thus:-

“8. If the compensation for the delay in construction is restricted to what is stipulated in the Buyers Agreement, there will be no pressure upon the builder to complete the construction since he will be more than happy to keep on paying paltry compensation of about 3% per annum of the capital investment, instead of arranging funds at much higher cost, to complete the construction.

9. xxxxxxxxxxxxx

10. For the reasons stated hereinabove, the complaints are disposed of with the following directions:

(1) xxxxxxxxxxxxxx

(2) The opposite party shall pay compensation in the form of simple interest @ 12% per annum from the expected date of possession till the date on which the possession is actually offered to the complainants after completing the construction in all respects and obtaining the requisite completion certificate.

29. No doubt, in the Buyer’s Agreement, some scope for delay due to unavoidable circumstances was kept in mind, for compensating the complainants for delay, but it does not mean that the intention was that even in the event of inordinate delay, in completing the construction and delivering the possession, the complainants would be entitled to meagre compensation of Rs.10/- per sq. ft. per month, which is much less than the bank rate for loan or fixed deposit. Therefore, in our considered view, Clauses 11(a) and 15 were meant for computing compensation, in case of a minor delay in delivery of possession.

30. Thus, keeping in view the principle of law laid down by the Hon’ble National Commission, in the cases, referred to above, and position stated above, the complainants are entitled to grant of compensation in the form of simple interest @12% on the deposited amount for the period of delay, beyond two years plus one year extended period i.e. w.e.f. 24.02.2014 up-to + 2 months from the date of offer of possession. The possession having been offered on 15.11.2016, the complainants shall be entitled to compensation up-to plus 2 months from 15.11.2016 i.e. 14.01.2017 (30 days for making payment + 30 days grace period). Since the complainants did not deposit the entire amount as demanded in the offer of possession letter, delay beyond two months, as above, is clearly attributable to them and not the Opposite Party. The complainants are, thus, held entitled to compensation by granting interest @12% on the deposited amount for the delay period as above. In the event of failure of the Opposite Parties to deliver possession within 30 days after deposit of due payment and submission of documents by the complainants, for delay beyond 30 days, the complainants shall be further entitled to interest @12% p.a. on the deposited amount till possession is delivered.

31. The next question, that falls for consideration, is, as to whether, the complainants are entitled to compensation, under Section 14(1)(d) of the Act, on account of mental agony and physical harassment, and injury caused to them, for inordinate delay in delivering physical possession of the unit to them, by the Opposite Party, by the date promised in the Agreement and within one year extended period. The complainants have been compensated by granting 12% interest for the delay period as stated above. The price of the unit, in question, is escalation free. The complainants shall also get the benefit of escalation in price of the unit. Grant of compensation in the sum of Rs.1,50,000/- in this case would serve the ends of justice.

32. In six connected complaints bearing Nos.346, 718, 802, 804, 848 of 2017 and 11 of 2018, the possession of the unit(s), in question, has been offered but the same has been delivered to the complainant(s) only in complaint bearing No.346 of 2017. However, in complaint bearing No.718 of 2017, the complainant has sought refund of the deposited amount. The details of date of agreement, due date for possession, date on which possession offered, whether amount deposited after offer of possession and documents submitted etc., are given in the following table:-

	COMPLAINT NO.
Sr. No.		346/2017	718/2017	802/2017	804/2017	848/2017	11/2018
1.	Date of Independent Floor Buyer’s Agreement.	02.02.2011 (2^nd Allotee) 24.02.2012	07.02.2011 (2^nd Allotee) 22.01.2013	17.02.2011	14.02.2011	31.01.2011	13.12.2010
2.	Amount paid as per Chart (Rs.).	49,31,706.00	46,86,827.05	47,63,755.00	52,66,870.00	49,10,282.23	40,60,402.35
3.	Due date for possession after 2 years plus 1 year extended period.	01.02.2014	06.02.2014	16.02.2014	13.02.2014	30.01.2014	12.12.2013
4.	Date on which possession offered.	29.10.2016	19.04.2017	03.02.2016	15.11.2016	14.01.2016	15.10.2016
5.	Whether amount deposited after offer of possession.	Yes on 28.04.2017; Nothing is due	No, seeking refund	Yes, on 14.03.2016 including VAT; Nothing is due	Not deposited	Yes on 28.03.2017	Yes, on 21.04.2017; Nothing is due
6.	Whether documents submitted after offer of possession.	Yes	No, seeking refund	No	Pending	Yes	Yes on 18.02.2018
7.	Date on which possession delivered.	06.06.2017	-	-	-	-	-
8.	Date of Occupation Certificate.	02.05.2016 (R-2 Colly.)	12.01.2017 (R-2 Colly.)	10.07.2015 (R-2 Colly.)	09.09.2016 (R-2 Colly.)	10.07.2015 (R-2 Colly.)	18.03.2016 (R-2 Colly)

33. As stated above, in aforesaid six complaints, though possession of the unit(s), in question, has been offered in all the complaints, but the same has been delivered by the Opposite Parties to the complainants only in complaint bearing No.346 of 2017 on 06.06.2017, in which, they (complainants) made payment towards the demand raised vide offer of possession letter on 28.04.2017.

34. It may also be stated here that the amounts towards the demands raised vide offer of possession letters have been deposited by the complainants in complaints bearing No.346, 802, 848 of 2017 & 11 of 2018. However, the requisite documents have not been submitted in complaints bearing Nos.802 and 804 of 2017.

35. In complaint bearing No.802 of 2017, the complainants submitted Snag List/Customer Observation to the Opposite Parties on 26.05.2017 (Annexure C-4, at Page 95 of the file), pointing out various snags, which, as alleged by the complainants have not been rectified. The Counsel for the Opposite Parties, stated that the snags/deficiencies, if any, will be removed, before delivering possession.

36. In complaint bearing No.848 of 2017, Counsel for the Opposite Parties during arguments, stated that after removing snags pointed out by the complainants, reminder to take possession has been sent to them (complainants) on 03.04.2018.

37. It may also be stated here that in complaints bearing Nos.802 & 848 of 2017, while offering possession vide letters dated 03.02.2016 & 14.01.2016, the Opposite Parties raised demands of Rs.2,49,628/- & Rs.2,51,428/- on account of Stamp Duty & Registration Charges.

38. It was stated and agreed by Counsel for the Opposite Party that the stamp duty and registration charges would be payable by the complainants at the time of execution of sale deed. Besides, incidental expenses for execution of sale deed shall also be borne by the complainants.

39. Therefore, in all the aforesaid complaints i.e. CC Nos.346, 802, 804, 848 of 2017 & 11 of 2018 (except Complaint bearing No.718 of 2017 wherein the complainant has sought refund of the amount deposited), the complainants are held entitled to compensation @12% p.a. interest on the deposited amount(s) for the delay period, after 2 years plus 1 year extended period, up-to + 2 months from the date of offer of possession.

40. Further after payment and submission of documents, in the event of failure of the Opposite Parties to deliver possession, within 30 days, for delay beyond 30 days, the complainant(s) shall be further entitled to interest @12% till actual physical possession is/was delivered.

41. In complaints bearing No.804 of 2017 and 11 of 2018, the amounts of Rs.8,20,269.00/- and Rs.6,07,202/- on account of delay compensation, credit for which has already been given, shall be deducted from the compensation amount arrived at by way of interest @12% for delay period.

42. The complainant(s), in the aforesaid complaints, are also entitled to compensation for mental agony, harassment and deficiency in rendering service. The complainant(s) are, as such, held entitled to compensation in the sum of Rs.1,50,000/- in each case.

43. In complaint bearing No.718 of 2017, the complainant has sought refund of the deposited amount. It is pertinent to mention here that initially the complainant has sought refund of the entire amount of Rs.46,86,826/- alongwith interest @18% p.a. from the respective dates of deposit besides Rs.5,00,000/- and Rs.40,000/- towards compensation and litigation expenses. Later on, by moving Miscellaneous Application bearing No.1091 of 2017, the complainant sought amendment in the prayer clause and sought interest @15% p.a. on the deposited amount of Rs.46,86,826/-, instead of 18% p.a., besides Rs.2,00,000/- and Rs.35,000/- towards compensation and litigation expenses. The Miscellaneous Application was allowed by this Commission vide order dated 14.11.2017 passed in the said application.

44. In the Chart submitted by the Counsel for the Opposite Parties, during arguments, and as tabulated in the aforesaid table, receipt of above amount of Rs.46,86,826/- has been admitted by the Opposite Parties.

45. As is evident from record of the above complaint, the complainant, namely, Sh. Surender Singh Rathee, is a subsequent allottee as the unit, in question, was purchased by him from the original allottee Kusum Wadhawan, which was then transferred in his name vide letter dated 22.01.2013 (at Page 227 of the written statement). Independent Floor Buyer’s Agreements was executed between the original allottee and the Opposite Parties on 07.02.2011. As per Clause 11(a), (b) & (c) of the Agreement, 24 months period plus the extended period of 12 months (on account of stay by the Hon’ble Supreme Court from 19.04.2012 till 12.12.2012) from the date of execution of the agreement expired on 06.02.2014. Possession was offered on 19.04.2017. There has been, thus, inordinate delay in offering possession. This Commission in the case of Brig Ajay Raina (Retd.) and another Vs. M/s Unitech Limited, Consumer Complaint No.59 of 2016, decided on 24.05.2016, wherein, there was inordinate delay, in the light of law settled by Hon’ble National Commission in such cases, held that the complainant is entitled to refund of the amount deposited with the Opposite Party. Relevant Paras of the aforesaid judgment read thus:-

“Further, even if, it is assumed for the sake of arguments, that offer of possession, was made to the complainants, in July 2015 i.e. after a delay of about three years, from the stipulated date, even then, it is not obligatory upon the complainants to accept the same. It was so held by the National Commission in Emaar MGF Land Limited and another Vs. Dilshad Gill, III (2015) CPJ 329 (NC). Recently also, under similar circumstances, in the case of M/s. Emaar MGF Land Ltd. & Anr. Vs. Dr.Manuj Chhabra, First Appeal No.1028 of 2015, decided on 19.04.2016, the National Commission, held as under:-

“I am of the prima facie view that even if the said offer was genuine, yet, the complainant was not obliged to accept such an offer, made after a lapse of more than two years of committed date of delivery”.

The principle of law laid down in the aforesaid cases is fully applicable to the present case. It is therefore held that the complainants could not be held guilty, of filing the present complaint, seeking refund of the deposited amount, alongwith interest and compensation, as possession of the unit was not offered to them by the stipulated date.

It was clearly stated by the National Commission, in Emaar MGF Land Limited and another Vs. Dilshad Gill, III (2015) CPJ 329 (NC), that when the promoter has violated material condition, in not handing over possession of the unit, in time, it is not obligatory for a purchaser to accept possession after that date. Further in a case titled as Aashish Oberai Vs. Emaar MGF Land Limited, Consumer Case No.70 of 2015 decided on 14 Sep 2016, under similar circumstances, the National Commission negated the plea taken by the builder while holding as under:-

“I am in agreement with the learned senior counsel for the complainant that considering the default on the part of the opposite party in performing its contractual obligation, the complainant cannot be compelled to accept the offer of possession at this belated stage and, therefore, is entitled to refund the entire amount paid by him alongwith reasonable compensation, in the form of interest.”

Therefore, the complainant, in this complaint, is held entitled to refund of the amount alongwith interest @13% per annum. Since the unit, in question, was transferred in favour of the complainant on 22.01.2013, in the light of ratio of judgment in case titled ‘Darbara Singh and ors. Vs. Emaar MGF Land Limited and Ors.’, Complaint Case No.147 of 2016 decided by this Commission on 22.08.2016, the complainant is held entitled to interest @13% per annum, w.e.f. 22.01.2013 in respect of amounts deposited up-to 22.01.2013 and interest @13% per annum on the amounts deposited thereafter from 22.01.2013 onwards from the respective dates of deposits.

46. As regards compensation for mental agony, harassment etc., it may be stated here that in the instant case, as is apparent from Final Statement of Account annexed with offer of possession letter dated 19.04.2017, there is a huge DLI in the sum of Rs.5,54,784.55, on account of delayed payments by the complainant. Delay in payment of installments partly contributes to delay in completion of the project. Therefore, the complainant is not entitled to same amount of compensation, which this Commission has been granting in cases of this project. In the facts and circumstances of the case, grant of compensation in the sum of Rs.75,000/-, would serve the ends of justice.

47. No other point, was urged/pressed, by the Counsel for the parties, in all the cases.

48. For the reasons recorded above, all the complaints bearing Nos.346, 595, 718, 802, 804 & 848 of 2017 and 11 of 2018 are partly accepted, with costs, in the following manner:-

Consumer Complaints bearing No:

595, 802, 804, 848 of 2017 and 11 of 2018

49. In these complaints, possession of the unit(s), in question, was offered to the complainant(s) in the months of January, February, October & November 2016. The amount(s) towards the demand raised vide offer of possession letters have been deposited in all the complaints except in complaint bearing No.804 of 2017. Except in complaints bearing No.595 & 804 of 2017, the requisite documents have also been submitted by the complainant(s). Admittedly, possession of the unit(s), in question, has not yet been delivered to the complainant(s). The Opposite Parties shall hand over possession within 30 days after removing the snags, if any, after deposit of amount, wherever due and submission of documents by the complainant(s).

The Opposite Parties, in each of these cases, are, jointly and severally, directed as under:-

(i)	To hand over physical possession of the unit(s), allotted in favour of the complainant(s), complete in all respects, to the complainant(s), after removing the snags, if any, within a period of 30 days, from the date balance payment, wherever due, is made and documents, are submitted.
(ii)	Execute and get registered the sale deed(s) in respect of the unit(s), in question, within one month from the date of handing over of possession to the complainant(s). The stamp duty, registration charges and incidental expenses, if any, shall be borne by the complainant(s).
(iii)	To pay compensation, by way of interest @12% p.a., on the deposited amount, to the complainant(s), with effect from 24.02.2014, 17.02.2014, 14.02.2014, 31.01.2014 & 13.12.2013 respectively up-till two months from the date of offer of possession i.e. up-to 14.01.2017, 02.04.2016, 14.01.2017, 13.03.2016 & 14.12.2016 respectively, [w.e.f. due date(s) of possession in respect of deposits made up-to the said due date and from respective dates of deposits in respect of amount(s) paid after the said due date],within 45 days, from the date of receipt of a certified copy of this order, failing which, the said amount shall carry penal interest @15% p.a., instead of 12% p.a., from the date of default i.e. after expiry of 45 days period, till realization. (Since the Opposite Parties have given a credit of Rs.8,20,269/- & Rs.6,07,202/- in CC Nos.804 of 2017 & 11 of 2018 respectively, on account of delay compensation, this amount shall be reduced/deducted from the compensation amount arrived at by way of interest @12% on the deposited amount for the delay period). Further for failure of Opposite Parties to deliver possession within 30 days from the date of making payment/ submission of documents by the complainant(s), for such delay, beyond 30 days, compensation by way of interest @12% p.a. on the deposited amount for each month, till possession is delivered, shall be payable by 10^th of the following month and failure shall entail penal interest @15% p.a., instead of 12% p.a., from the date of default till payment is made.
(iv)	Pay compensation in the sum of Rs.1,50,000/-, in each, case, on account of mental agony, physical harassment and deficiency in service and litigation costs of Rs.35,000/-, in each case, to the complainant(s), within 45 days from the date of receipt of a certified copy of the order, failing which, the said amount shall carry interest @12% p.a., from the date of filing the complaint(s) till realization.

Consumer Complaint bearing No:

346 of 2017.

50. In this case, possession of the unit, in question, stands delivered to the complainants on 06.06.2017.

The Opposite Party, in this case, is held liable and directed as under:-

(i)	Execute and get registered the sale deed in respect of the unit, in question, within one month from the date of receipt of certified copy of the order. The stamp duty, registration charges and incidental expenses, if any, shall be borne by the complainants.
(ii)	To pay compensation, by way of interest @12% p.a., on the deposited amounts, to the complainants, with effect from 02.02.2014 till 28.12.2016 [w.e.f. 02.02.2014 in respect of deposits made up-to 02.02.2014 and from respective dates of deposits in respect of amount(s) paid after 02.02.2014], within 45 days, from the date of receipt of a certified copy of this order, failing which, the said amount shall carry penal interest @15% p.a., instead of 12% p.a., from the date of default i.e. after expiry of 45 days period, till realization.
(iii)	Pay compensation in the sum of Rs.1,50,000/-, on account of mental agony, physical harassment and deficiency in service and Rs.35,000/-, as litigation costs, to the complainants, within 45 days from the date of receipt of a certified copy of the order, failing which, the said amounts shall carry interest @12% p.a., from the date of filing the complaint till realization.

51. As agreed between the parties, the Advocate Charges shall not be charged by the Opposite Parties. The actual expenditure for registration of Sale Deed(s) besides Stamp duty and Registration charges, shall, however, be borne by the complainant(s).

Consumer Complaint bearing No:

718 of 2017.

52. The Opposite Parties, in this case, are jointly and severally, held liable and directed as under:-

To refund the amount of Rs.46,86,826/- alongwith simple interest @13% per annum, to the complainant, with effect from 22.01.2013 for the amount(s) paid uptil 22.01.2013 by the previous allottee and from the respective dates of deposits, in respect of payments made w.e.f. 22.01.2013 onwards, within a period of 45 days, from the date of receipt of a certified copy of this order, failing which, the Opposite Parties shall pay the aforesaid amounts alongwith simple interest @15% per annum, instead of 13% per annum, from the date of default i.e. after expiry of 45 days period, till actual payment;
To pay an amount of Rs.75,000/- on account of mental agony, physical harassment and deficiency in service and Rs.35,000/- as litigation costs, to the complainant, within a period of 45 days from the date of receipt of a certified copy of the order, failing which, the Opposite Parties shall pay the aforesaid amounts alongwith simple interest @13% per annum, from the date of filing the complaint till actual payment.

53. However, it is made clear that in case, the complainant has availed loan facility from any financial institution(s), such an Institution shall have the first charge on the amount payable, to the extent, the same is due against the complainant.

54. Certified copy of this order, be placed on the file of consumer complaints bearing Nos.346, 718, 802, 804 & 848 of 2017 and 11 of 2018.

55. Certified copies of this order be sent to the parties, free of charge.

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

Pronounced.

23.04.2018.

[JUSTICE JASBIR SINGH (RETD.)]

PRESIDENT

(DEV RAJ)

MEMBER

(PADMA PANDEY)

MEMBER

Chandigarh

StateCommission

CC/595/2017

Mrs. Sunita Dhull - Complainant(s)

Versus

DLF Homes Panchkula Private Limited - Opp.Party(s)

Jagjeet Beniwal Adv.

23 Apr 2018

ORDER

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