Chandigarh

StateCommission

CC/831/2016

Raman Kumar Saharan - Complainant(s)

Versus

DLF Homes Panchkula Pvt. Lmtd. - Opp.Party(s)

Karan Singh Adv.

05 May 2017

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

Consumer Complaint	:	831 of 2016
Date of Institution	:	21.11.2016
Date of Decision	:	05.05.2017

 

 

1. Raman Kumar Saharan S/o Ranjit Singh Saharan R/o C/o Dr. Baljit Singh, House No.2019, Sector 27-C, Chandigarh.
2. Mrs. Anamika Saharan W/o Raman Kumar Saharan R/o C/o Dr. Baljit Singh, House No.2019, Sector 27-C, Chandigarh.

 

                                            .........Complainants.

                                 Versus

 

 

1. DLF Homes Panchkula Private Limited, having its office at SCO no.190-192, Sector 8-C, Madhya Marg, Union Territory, Chandigarh through its Sales Manager.
2. DLF Pvt. Ltd., having regd. Office at DLF Gateway Tower, Second Floor, DLF City, Phase-III, Gurgaon – 122002, Haryana through its Directors.

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

 

Argued by:

 

Sh. Karan Singh, Advocate for the complainants.

Ms. Ekta Jhanji, Sh. Parveen Jain & Ms. Sapna Seth, Advocates for the Opposite Parties alongwith Sh. Shiv Kumar, Advisor (Legal) of the Company.

 

Consumer Complaint	:	8 of 2017
Date of Institution	:	04.01.2017
Date of Decision	:	05.05.2017

 

Mohinder Paul S/o Late Sh. Manohar Lal R/o House No.303, Guru Tegh Bahadur Nagar, Jalandhar, Punjab.

 

                                            .........Complainant.

                                 Versus

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

 

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

Argued by:

 

Sh. Karan Garg, Advocate for the complainant.

Ms. Ekta Jhanji, Sh. Parveen Jain & Ms. Sapna Seth, Advocates for the Opposite Party alongwith Sh. Shiv Kumar, Advisor (Legal) of the Company.

 

 

Consumer Complaint	:	23 of 2017
Date of Institution	:	11.01.2017
Date of Decision	:	05.05.2017

 

1. Col. Dinesh Panwar S/o Sh. S.P.S. Panwar,
2. Meenakshi Panwar W/o Col. Dinesh Panwar,

Both R/o H.No.3165, Sector-23, Gurgaon, Haryana.  

 

                                            .........Complainants.

                                 Versus

1. DLF Homes Panchkula Pvt. Ltd. SCO 190-191-192, Sector-8C, Chandigarh – UT., Pin – 160009 through its Manager/Authorized Signatory/Office-in-charge/Director Sales and Marketing.
2. DLF Homes Panchkula Pvt. Ltd., 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 and Marketing.

 

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

Argued by:

 

Sh. Narender Yadav, Advocate for the complainants.

Ms. Ekta Jhanji, Sh. Parveen Jain & Ms. Sapna Seth, Advocates for the Opposite Parties alongwith Sh. Shiv Kumar, Advisor (Legal) of the Company.

 

Consumer Complaint	:	24 of 2017
Date of Institution	:	11.01.2017
Date of Decision	:	05.05.2017

 

1. Monika Goyal W/o Sh. Vineet Goyal,
2. Vineet Goyal S/o Sh. Prem Sukh Goyal,

Both R/o M/s Prem Sons, Main Bazaar, Solan, Distt. Solan.

 

                                            .........Complainants.

Versus

1. DLF Homes Panchkula Pvt. Ltd. SCO 190-191-192, Sector-8C, Chandigarh – UT., Pin – 160009 through its Manager/Authorized Signatory/Office-in-charge/Director Sales and Marketing.
2. DLF Homes Panchkula Pvt. Ltd., 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 and Marketing.

 

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

 

Argued by:

 

Sh. Narender Yadav, Advocate for the complainants.

Ms. Ekta Jhanji, Sh. Parveen Jain & Ms. Sapna Seth, Advocates for the Opposite Parties alongwith Sh. Shiv Kumar, Advisor (Legal) of the Company.

 

Consumer Complaint	:	25 of 2017
Date of Institution	:	11.01.2017
Date of Decision	:	05.05.2017

 

1. Col. B. S. Ahlawat S/o Badlu Ram,
2. Shakuntla Ahlawat W/o Col. B. S. Ahlawat,

Both R/o A-28, Vijay Rattan Vihar, Sector-15, Part 2, Gurgaon.

 

                                            .........Complainants.

                                 Versus

1. DLF Homes Panchkula Pvt. Ltd. SCO 190-191-192, Sector-8C, Chandigarh – UT., Pin – 160009 through its Manager/Authorized Signatory/Office-in-charge/Director Sales and Marketing.
2. DLF Homes Panchkula Pvt. Ltd., 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 and Marketing.

 

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

Argued by:

 

Sh. Narender Yadav, Advocate for the complainants.

Ms. Ekta Jhanji, Sh. Parveen Jain & Ms. Sapna Seth, Advocates for the Opposite Parties alongwith Sh. Shiv Kumar, Advisor (Legal) of the Company.

 

Consumer Complaint	:	26 of 2017
Date of Institution	:	11.01.2017
Date of Decision	:	05.05.2017

 

Sanjeev Goel S/o Late Sh. Amar Nath Goel, R/o H.No.1665, Sector 15, Panchkula.

 

                                            .........Complainant.

                                 Versus

 

1. DLF Homes Panchkula Pvt. Ltd. SCO 190-191-192, Sector-8C, Chandigarh – UT., Pin – 160009 through its Manager/Authorized Signatory/Office-in-charge/Director Sales and Marketing.
2. DLF Homes Panchkula Pvt. Ltd., 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 and Marketing.

 

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

Argued by:

 

Sh. Narender Yadav, Advocate for the complainant.

Ms. Ekta Jhanji, Sh. Parveen Jain & Ms. Sapna Seth, Advocates for the Opposite Parties alongwith Sh. Shiv Kumar, Advisor (Legal) of the Company.

 

Consumer Complaint	:	27 of 2017
Date of Institution	:	11.01.2017
Date of Decision	:	05.05.2017

 

Parveen Deswal S/o Sh. Shiv Swaroop Yadav, HQ SPIC DRDO, Rao Tularam Marg Development Enclave, Delhi Cantt. Delhi – 110010.

 

                                            .........Complainant.

                                 Versus

 

1. DLF Homes Panchkula Pvt. Ltd. SCO 190-191-192, Sector-8C, Chandigarh – UT., Pin – 160009 through its Manager/Authorized Signatory/Office-in-charge/Director Sales and Marketing.
2. DLF Homes Panchkula Pvt. Ltd., 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 and Marketing.

 

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

Argued by:

 

Sh. Narender Yadav, Advocate for the complainant.

Ms. Ekta Jhanji, Sh. Parveen Jain & Ms. Sapna Seth, Advocates for the Opposite Parties alongwith Sh. Shiv Kumar, Advisor (Legal) of the Company.

 

 

Consumer Complaint	:	28 of 2017
Date of Institution	:	11.01.2017
Date of Decision	:	05.05.2017

 

Chand Ram S/o Sh. Jai Lal, H.No.193, Sector-2, Rohtak.

 

                                            .........Complainant.

                                 Versus

1. DLF Homes Panchkula Pvt. Ltd. SCO 190-191-192, Sector-8C, Chandigarh – UT., Pin – 160009 through its Manager/Authorized Signatory/Office-in-charge/Director Sales and Marketing.
2. DLF Homes Panchkula Pvt. Ltd., 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 and Marketing.

 

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

Argued by:

 

Sh. Narender Yadav, Advocate for the complainant.

Ms. Ekta Jhanji, Sh. Parveen Jain & Ms. Sapna Seth, Advocates for the Opposite Parties alongwith Sh. Shiv Kumar, Advisor (Legal) of the Company.

 

 

Consumer Complaint	:	47 of 2017
Date of Institution	:	17.01.2017
Date of Decision	:	05.05.2017

 

Arjun Bragta, son of Late Sh. Partap Singh Bragta, resident of Village Ghalera, PO Chalnair, Tehsil Kotkhai, Distt. Shimla, Himachal Pradesh.

 

                                            .........Complainant.

                                 Versus

M/s DLF Homes Panchkula Pvt. Ltd., having its office at SCO 190-191-192, Sector 8-C, Chandigarh – 160009 through its Managing Director.

 

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

Argued by:

 

Sh. Vipul Dharmani, Advocate for the complainant.

Ms. Ekta Jhanji, Sh. Parveen Jain & Ms. Sapna Seth, Advocates for the Opposite Party alongwith Sh. Shiv Kumar, Advisor (Legal) of the Company.

 

 

Consumer Complaint	:	93 of 2017
Date of Institution	:	30.01.2017
Date of Decision	:	05.05.2017

 

1. P. K. Jindal son of Sh. P. D. Jindal, resident of Sh. P. D. Jindal,
2. Neelam Jindal wife of Sh. P. K. Jindal,

Both resident of House No.B-1, PWD B&R Colony, Near Bus Stand, Sirsa, Haryana.

 

                                            .........Complainants.

                                 Versus

1. DLF Homes Panchkula Pvt. Ltd., having office at SCO 190-191-192, Sector 8C, Chandigarh through its Managing Director.
2. DLF Homes Panchkula Pvt. Ltd. having Regd. Office. DLF Gateway Tower, Twelfth (12) Floor, DLF City, Phase III, Gurgaon 122002, Haryana, India through its Vice Chairman.

 

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

Argued by:

 

Sh. Sanjeev Sharma, Advocate for the complainants.

Ms. Ekta Jhanji, Sh. Parveen Jain & Ms. Sapna Seth, Advocates for the Opposite Parties alongwith Sh. Shiv Kumar, Advisor (Legal) of the Company.

 

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 the aforesaid 10 consumer complaints bearing Nos.831 of 2016, 8, 23, 24, 25, 26, 27, 28, 47 & 93 all of 2017.

2.          After hearing arguments on 21.04.2017, we were of the opinion that the facts and issues in law, involved in the above bunch of complaints, by and large, are the same, and therefore, the aforesaid 10 complaints can be disposed of, by passing one consolidated order.

3.          During arguments, Ms. Ekta Jhanji, Advocate, Counsel for the Opposite Parties, placed on record, a detailed chart, under her signatures, showing in each case detail of property purchased, its price, date of agreement, total price and amount received and further when possession was offered, etc. which was taken on record. It was also stated by the Counsel that the facts given in the chart were correct, as per their record.

4.          Under above circumstances, to dictate order, facts are being taken from consumer complaint bearing No.831 of 2016, titled as ‘Raman Kumar Saharan & Anr. Vs. DLF Homes Panchkula Pvt. Ltd. & Anr.’.

5.          In brief, the facts are that the complainants booked a flat No.DVF-C-3/14 FF (First Floor) in the project of the project of the Opposite Parties, namely, DLF Valley, Panchkula,  on 24.03.2010 by paying an amount of Rs.4,00,000/-. The complainants were allotted the same vide allotment letter dated 05.04.2010 (Annexure C-1). An Independent Flat Buyer’s Agreement was executed between the parties on 11.01.2011. As per Clause 11(a) of the said Agreement, the possession of the completed unit was to be delivered within 24 months from the date of execution of the said Agreement i.e. on or before 10.01.2013. The complainants had paid an amount of Rs.19,40,971/- up-to 12.04.2012. Thereafter, the Opposite Parties stopped making demands of payments towards the unit, in question. In July, 2012,  complainant No.1 visited the office of the Opposite Parties to inquire the status of construction work but he was not allowed to see construction position of his property. He was informed that the construction work had been stopped because of stay granted by the Hon’ble Supreme Court. The stay was vacated on 12.12.2012 but the construction work at the site did not start for a long time. It was further stated that possession of the property was not offered by 10.01.2013. It was further stated that the Opposite Parties again demanded payment in the month of March 2013, which was duly paid.  

6.         It was further stated that on visiting the site in the month of August, 2013, complainant No.1 was shocked to see that the construction was going on at a snail speed and there were no basic amenities on site as promised. The Opposite parties stated that they would try to complete construction within 12 months but they failed. It was further stated that the basic amenities like roads, club house, swimming pool, parks were not complete and construction was too slow. It was further stated that the complainants made all the payments as and when demanded and till 08.12.2014, they made payment of Rs.32,78,305.66 against the agreed amount of Rs.35,37,099.78. It was further stated that the Opposite Parties did not deliver possession of the unit, in question, even after about four years, of the promised date. 

7.          Alleging deficiency, in rendering service, and indulgence into unfair trade practice, on the part of the Opposite Parties, the complainants filed the instant complaint under Section 17 of the Consumer Protection Act 1986 (in short 1986 Act) seeking directions to the Opposite Parties, to hand over physical possession of the unit, in question, immediately without any further delay; execute conveyance dead and get the same registered with the office of Sub Registrar as per Haryana Govt. rates after handing over physical possession of the floor;  pay interest on the deposited amount w.e.f. 01.12.2014 till the date of actual handing over of physical possession of the flat; interest @18% per annum on the deposited amount w.e.f. 30.11.2012; not to ask for excess amount beyond the agreed cost of the unit as per agreement i.e. Rs.40,02,099.78; pay Rs.2,00,000/- as compensation on account of mental agony and harassment and Rs.1,00,000/- for litigation expenses and grant any other relief which this Commission deems fit and proper under the facts and circumstances of the present case.

8.          The Opposite Parties, in their preliminary submissions in the written statement stated that possession has already been offered to the complainants vide letter dated 15.11.2016. It was further stated that the instant complaint has been filed in total disregard to the terms of Floor Buyer’s Agreement dated 11.01.2011 executed between the parties, which amounted to default/breach of its terms and conditions. It was further stated that the complainants are backing out from the executed contract. It was further stated that the complainants had full knowledge about the executed terms of Agreement. 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 Parties pray to allow 31% cost escalation of the construction as well 47% of the land holding cost, totaling 76% of the sale price. It was further stated that the project was cost escalation free as the complainants shall get the possession of the floor on the same price as committed by the Opposite Parties at the time of booking of the floor on 05.04.2010. 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. The Opposite Parties have further stated that after dismissal of the said litigation by Hon’ble Supreme Court on 12.12.2012, the Opposite Parties vide letter dated 15.04.2013 (Annexure R-3) offered an exit option to the complainants by accepting refund of their entire amount paid till date with 9% interest but they refused to avail the said option and apart from opting to continue with the project, also consented to the extension of time.

9.          As regards present status of the project, it was stated that occupation certificate(s) of 1669 units had already been received. 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.

10.        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 booked by them for investment purposes and earning profits and that when given the option to exit vide letter dated 15.04.2013, the complainants agreed to continue with allotment and delay and, as such, they (complainants) voluntarily waived of their right to raise any grievance. Another objection raised in the written statement is 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 Parties 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 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 8 of preliminary objections, it was 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. Apart from above objections, the territorial jurisdiction of this Commission to entertain and try the complaint has been challenged on the ground that since the property, in dispute, is situated in Panchkula, which comes within the jurisdiction of Panchkula District, only Courts at Panchkula and Punjab & Haryana High Court have the territorial jurisdiction to entertain and try the instant complaint. However, it was admitted in Para 19 of the reply, on merits, that the office of the opposite parties is situated in Chandigarh and the agreement was executed between the parties at Chandigarh.

11.        The Opposite Parties also moved miscellaneous applications under Section 8 of Arbitration and Conciliation Act, 1996 in the following consumer complaints, for referring the matter to the sole arbitration:-

Sr. No.	Complaint Case No.	Miscellaneous Application No.
	831/2016	18/2017
	8/2017	367/2017
	23/2017	371/2017
	24/2017	363/2017
	25/2017	365/2017
	26/2017	375/2017
	27/2017	370/2017
	28/2017	366/2017
	472017	313/2017

 

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.  

12.         On merits, it was stated that the complainants booked Property No.DVF-C3/14-FF on 05.04.2010 and both the parties signed the Agreement on 11.01.2011. It was further stated that later on, name of Mrs. Anamika Saharan got added on 08.02.2012. It was further stated that the value of the property as per Schedule of Payment (SOP) was Rs.40,23,439.10 plus service tax. It was further stated that since area of the floor got increased from 1550 sq. ft. to 1751 sq. ft., therefore, the price of the floor also increased to Rs.43,08,980.95. It was further stated that till date, the complainants had paid an amount of Rs.32,78,236.66 and there is a DLI of Rs.48,180.04 levied against the complainants on account for delay of 1538 days in making payments. 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 signing of the Agreement subject to force majeure conditions or due to reasons beyond the control of Opposite Parties as mentioned in Clauses 11(b) and 11(c) of the Agreement. It was further stated that delivery of possession of the unit, in question, was delayed on account of force majeure conditions. It was further stated that SLP No.21786-88/2010 was filed, wherein the Hon’ble Apex Court stayed the construction activities at the project vide order dated 19.04.2012, which was vacated on 12.12.2012 only. It was further stated that after vacation of stay, the construction work again resumed and, therefore, delay in handing over possession was due to force majeure conditions. It was further stated that neither there was any deficiency, in rendering service, on the part of the Opposite Parties nor they indulged into any unfair trade practice. The remaining averments, were denied, being wrong.

13.        The complainants, in support of their case, submitted affidavit of Sh. Raman Kumar Saharan (complainant No.1), by way of evidence, alongwith which, a number of documents were attached.

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

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

16.        It is evident that the complainants were allotted Independent Floor No.DVF-C3/14-FF#217 in DLF Valley,  Panchkula vide allotment letter dated 05.04.2010 (Annexure C-1) and Independent Floor Buyer’s Agreement was executed between the parties on 11.01.2011 (annexure C-3). The total price of the said independent floor, as depicted in the Agreement, was Rs.35,37,099.78, besides other charges, securities, deposits and taxes etc. as specified in the Application/Agreement. The complainants, in all, actually paid a sum of 32,78,236.66 as mentioned in the Chart showing details of the property, in question, placed on record, under the signatures of the Counsel for the Opposite Party(ies), at the time of arguments on 21.04.2017. As per Clause 11(a) of the Agreement, the Opposite Parties were to complete the construction of the said independent floor within a period of 24 months from the date of execution of the said

 

Agreement. Vide letter dated 15.04.2013 (Annexure R-3), they (Opposite Parties) sought further time of 12 months, in addition to 24 months, to complete the construction work. It was further stated that vide that letter, option was also given to the complainants to seek refund alongwith 9% interest. However, the complainants agreed to a further period of 12 months in handing over of possession. It is, however, on record, that there was stay by the Hon’ble Supreme Court of India from 19.04.2012 to 12.12.2012, which in turn, delayed the completion of the project. The Opposite Parties have claimed that this being a force majeure condition, they are entitled to benefit of delay of one year. The possession of the unit, in question, has been offered by the Opposite Parties to the complainants on 15.11.2016 vide offer of possession letter (Annexure R-1 colly) and the instant complaint was filed on 21.11.2016. 

17.        The Opposite Parties, in preliminary submissions, have prayed to allow them 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 Parties failed to complete construction and deliver possession within stipulated period and extended          one year period, they (Opposite Parties) are themselves responsible for delay and deficiency in service and        their prayer for allowing them escalation cost amounts           to seeking amendment of the terms and conditions of the Agreement. The plea, being devoid of merit, must fail, and the same stands rejected.

18.        Since the Independent Floor Buyer’s Agreement, in the instant case, was executed between the parties on 11.01.2011 and period stipulated therein for handing over possession was to commence from the date of execution of the same (Agreement), the averment of the Opposite Parties that Hon’ble Punjab & Haryana High Court had restrained them from creating any third party rights, during the year 2010 (Annexures R-6 and R-7), is not relevant.

19.           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. This question has already been elaborately dealt with by this Commission in case titled ‘Sarbjit Singh Vs. Puma Realtors Private Limited’, IV (2016) CPJ 126. Paras 25 to 35 of the said order, inter-alia, being relevant, are extracted hereunder:-

“25.        The next 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.

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.”

27.                It is also desirable to reproduce unamended provisions of Section 8 of 1996 Act, which reads thus:- 

“8. Power to refer parties to arbitration where there is an  arbitration agreement.—

(1) A judicial authority before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration.

(2) The application referred to in sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof.

(3) Notwithstanding that an application has been made under sub-section (1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made.”

28.      Many a times, by making reference to the provisions of Section 8 of 1996 Act, in the past also, such objections were raised and the Hon'ble Supreme Court of India, when interpreting the provisions of Section 3 of 1986 Act, in the cases of Fair Air Engg. Pvt. Ltd. & another Vs. N. K. Modi (1996) 6  SCC 385, C.C.I Chambers Coop. Housing Society Ltd. Vs Development Credit Bank Ltd. (2003) 7 SCC 233, Rosedale Developers Private Limited Vs. Aghore Bhattacharya and others, (Civil Appeal No.20923 of 2013) etc., came to a conclusion that the remedy provided under Section 3 of 1986 Act, is an independent and additional remedy and existence of an arbitration clause in the agreement, to settle disputes, will not debar the Consumer Foras, to entertain the complaints, filed by the consumers.

29.       In the year 2015, many amendments were effected in the provisions of 1996 Act. After amendment, Section 8 of 1996 Act, reads as under:-

 “8. Power to refer parties to arbitration where there is an arbitration agreement.—

(1) A judicial authority, before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party to the arbitration agreement or any person claiming through or under him, so applies not later than the date of submitting his first statement on the substance of the dispute, then, notwithstanding any judgment, decree or order of the Supreme Court or any Court, refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists.”

30.     Now it is to be seen, whether, after amendment in Section 8 of the principal Act, any additional right has accrued to the service provider(s), to say that on account of existence of arbitration agreement, for settling the disputes through an Arbitrator, the Consumer Foras have no jurisdiction to entertain a consumer complaint. As has been held by Hon'ble Supreme Court of India, in various cases, and also of the National Commission, in large number of judgments, Section 3 of the 1986 Act, provides additional remedy, notwithstanding any other remedy available to a consumer. The said remedy is also not in derogation to any other Act/Law.

31.        Now, we will have to see what difference has been made by the amendment, in the provisions of Section 8 of 1996 Act. After amendment, it reads that a Judicial Authority is supposed to refer the matter to an Arbitrator, if there exists an arbitration clause in the agreement, notwithstanding any judgment, decree, order of the Hon'ble Supreme Court of India, or any other Court, unless it finds that prima facie, no valid arbitration agreement exists. The legislation was alive to the ratio of the judgments, as referred to above, in earlier part of this order. Vide those judgments, it is specifically mandated that under Section 3 of 1986 Act, an additional remedy is available to the consumer(s), which is not in derogation to any other Act. As and when any argument was raised, the Hon'ble Supreme Court of India and the National Commission in the judgments, referred to above, have made it very clear that in the face of Section 8 of 1996 Act and existence of arbitration agreement, it is still opened to the Consumer Foras to entertain the consumer complaints. None of the judgments ever conferred any jurisdiction upon the Consumer Foras to entertain such like complaints. Only the legal issues, as existed in the Statute Book, were explained vide different judgments. If we look into amended provisions of Section 8 of the principal Act, it explains  that judicial Authority needs to refer dispute, in which arbitration agreement exist to settle the disputes notwithstanding any judgment/decree or order of any Court. That may be true where in a case,  some order has been passed by any Court, making arbitration Agreement non-applicable to a dispute/parties. However, in the present case, the above said argument is not available. The jurisdiction of Consumer Foras to entertain consumer complaints, in the face of arbitration clause in the Agreement, is in-built in 1986 Act. It was not given to these Foras, by any judgment ever. The provisions of Section 3 of 1986 Act interpreted vide judgments vis a vis Section 8 of un-amended 1996 Act, were known to the legislature, when the amended Act 2015 was passed. If there was any intention on the part of the legislature, then it would have been very conveniently provided that notwithstanding any remedy available in 1986 Act, it would be binding upon the judicial Authority to refer the matter to an Arbitrator, in case of existence of arbitration agreement, however, it was not so said.

32.        We can deal with this issue, from another angle also. If this contention raised is accepted, it will go against the basic spirit of 1986 Act. The said Act (1986) was enacted to protect poor consumers against might of the service providers/multinational companies/traders. As in the present case, the complainant has spent his life savings to get a unit, for his residential purpose. His hopes were shattered. Litigation in the Consumer Fora is cost effective. It does not involve huge expenses and further it is very quick. A complaint in the State Commission can be filed, by making payment between Rs.2000/- to Rs.4000/- (in the present case Rs.4000/-). As per the mandate of 1986 Act,  a complaint is supposed to be decided within three months, from the date of service to the opposite party. In cases involving ticklish issues (like the present one, maximum not more than six months to seven months time can be consumed), whereas, to the contrary, as per the principal Act (1996 Act),  the consumer will be forced to incur huge expenses towards his/her share of Arbitrator’s fees. Not only as above, 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 can safely be said that if the matter is referred to an Arbitrator, as prayed, in the present case, it will defeat the very purpose of the provisions of 1986 Act.

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.”

35.     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.”

             In view of the above, the objection raised by the Opposite Parties, being devoid of merit, is rejected.

20.        Another objection raised by the Opposite Parties was that 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 was stated that since the property, in question, is situated in District Panchkula and a part of cause of action arose at Panchkula. However, it was admitted in Para 19 of the reply, on merits, that the office of the opposite parties is situated in Chandigarh and the agreement was executed between the parties at Chandigarh. 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 them. Clearly, application for allotment of Unit (Annexure R-4, at Page 75 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 was also executed between the parties on 11.01.2011 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., Vs. 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 Foras. 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 Vs 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.

21.        In Cosmos Infra Engineering India Ltd. Vs Sameer Saksena & another I (2013) CPJ 31 (NC) and Radiant Infosystem Pvt. Ltd. & Others Vs 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 them, 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.

22.        The next objection raised by Counsel for Opposite Parties was 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. It was further stated that 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. 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”

 

 

23.        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. Vs.  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 Vs. 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.  

24.        To defeat claim of the complainants, the next objection raised by the Opposite Parties was that since the complainants had 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. 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. Otherwise also, in a case titled as Kavita Ahuja Vs. 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 Vs.  Nirmala Devi Gupta, 2016 (2) CPJ 316. Not only above, recently under similar circumstances, in a case titled as “Aashish Oberai Vs. Emaar MGF Land Limited”, Consumer Case No.70 of 2015, decided on 14 Sep. 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. vs. 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.  

25.        An objection has been raised by the Opposite Parties 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 rights to raise any grievance. This plea of the Opposite Parties is not well based. While seeking option vide letter dated 15.04.2013, the complainants were informed of delay and extension of one year was sought. One year extended period expired on 10.01.2014 whereas the possession was offered on 15.11.2016 vide offer of possession letter (Annexure R-1 colly.). 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 10.01.2014, 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.  

26.        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 11.01.2011 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 Parties, they were 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 complainant was 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. It is also an admitted fact, that by making reference to above fact of granting stay, which resulted into  delay in construction at the site, consent of the complainants was sought, vide letter dated 15.04.2013, to complete construction within further 12 months. Option was also given to the complainants, to seek refund of the deposited amount, alongwith simple interest @9% P.A. The complainants exercised former option and continued to make payment(s) thereafter and as admitted by the Counsel for the parties, at the time of arguments, the complainants have made payments in the sum of Rs.32,78,236.66. 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 in January 2014 on 10.01.2014. No justification whatsoever for delay in offering possession beyond 10.01.2014 has been explained by the Opposite Parties. By making a misleading statement, that possession of the unit, was to be delivered within  maximum period of 24 months from the date of execution of the Agreement and within further extended period of 12 months i.e. latest by 10.01.2014, and by not abiding by the commitment, made by the Opposite Parties, they were not only deficient, in rendering service, but also indulged into unfair trade practice. The argument of the Opposite Parties 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 11.01.2011 and before execution thereof, the Opposite Parties 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 Parties 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 Parties. Possession of the unit, in question, having been offered vide offer of possession letter dated 15.11.2016 (Annexure R-1 colly.), clearly, there is inordinate delay of around 2 years 10 months beyond initial stipulated period of two years and 1 year 10 months from one year extended period 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 Opposite Parties. The Opposite Parties are bound to remove the deficiencies/snags, if any, in the construction of the unit, in question, without any delay, and deliver the possession to the complainants, after deposit of amount by them (complainants).

27.         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 Parties 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 11.01.2011 i.e. by 10.01.2014. There is, thus, inordinate delay of around 1 year 10 months, even beyond the extended period. Possession of the unit, in question, was offered by the Opposite Parties on 15.11.2016. The 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, held in Para 16 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.

28.        Recently 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.

(3)   No separate compensation would be payable to the complainants either towards the rent if any paid by them or for the mental agony and harassment which they have suffered on account of the failure of the opposite party to perform its contractual obligation.”

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, 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. from 11.01.2014, till delivery of possession of the unit would meet the ends of justice. 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). The complainants are, thus, held entitled to compensation by granting interest @12% on the deposited amount for the delay period as above.

31.        In the instant case, though this Commission vide order dated 31.01.2017 directed the complainants to deposit the amount of demand raised vide offer of possession letter dated 15.11.2016 within four weeks from the date of the said order and also directed the Opposite Parties to deliver possession of the unit, in question, within four weeks thereafter, yet, as admitted by Counsel for the parties, neither the amount towards demand raised vide offer of possession letter dated 15.11.2016 was deposited with the Opposite Parties nor the requisite documents submitted.

32.        As per offer of possession letter placed, on record, six months’ time was given to the complainants to complete the formalities and make the payment.

33.        Ms. Ekta Jhanji and Sh. Parveen Jain, Advocates, Counsel for the Opposite Parties, on instructions, stated that in case, the complainants are eager to get possession, they will complete formalities and deposit the amount before the period of six months and as and when amount is deposited and necessary documents are submitted, within 3 weeks thereafter, possession will be handed over, to the complainants. It was further stated that contingent Vat deposit will not be insisted upon at this stage, subject to furnishing of an affidavit by the complainants to make the payment as and when demanded by the Government. In cases relating to this project, earlier the Opposite Parties, at the time of offering possession, were also raising demand   on   account   of  stamp  duty  and  registration charges but now while offering possession, no demand on account of stamp duty and registration charges has been raised.

34.         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 Parties, by the promised date in the Agreement or latest by 10.01.2014 i.e. within the extended period. Admittedly, the possession of unit, in question, has been offered to the complainants on 15.11.2016. The complainants have been adequately compensated by granting 12% interest for the delay period. The price of the unit, in question, is escalation free. The complainants shall also get the benefit of escalation in price of the unit. Under these circumstances, compensation, on account of mental agony and physical harassment, caused to the complainants, due to the acts of omission and commission of the Opposite Parties, if granted, to the tune of Rs.1,50,000/- shall be reasonable, adequate and fair. The complainants are, thus, held entitled to compensation, in the sum of Rs.1,50,000/-.

35.        Similarly, in following 6 complaints bearing No.8, 23, 25, 26, 27 and 28 all of 2016, particulars of which are indicated in Table below, the possession of the unit(s) was offered by the Opposite Parties on the dates indicated against the respective complaints:-

TABLE

Sr. No.	Complaint No.	Date of independent Floor Buyer’s Agreement.	Due date for possession after 2 years plus 1 year extended period	Date on which possession offered.	Whether amount and documents deposited after offer of possession.	Compensation credited (Rs.)
A.	B.	C.	D.	E.	F	G
1.	8/2017	11.01.2011	10.01.2014	05.10.2016	Yes on 17.01.2017	-
2.	23/2017	17.01.2011	16.01.2014	26.10.2016	Yes on 17.01.2017	-
3.	25/2017	20.01.2011	19.01.2014	15.11.2016	Yeson 27.01.2017	-
4.	26/2017	18.01.2011	17.01.2014	26.10.2016	Yes on 13.02.2017	-
5.	27/2017	06.01.2011	05.01.2014	10.10.2016	Yes on 04.02.2017 & 25.02.2017 (Documents pending)	-
6.	28/2017	12.01.2011	11.01.2014	08.06.2016	Yes on 04.03.2017	-

 

 

36.        In cases relating to this project, earlier the Opposite Parties, at the time of offering possession, were also raising demand   on   account   of  stamp  duty  and  registration charges but now while offering possession, no demand on account of stamp duty and registration charges has been raised.

37.        As per offer of possession letters placed, on record, in the aforesaid cases (except CC/28/2017), six months’ time was given to the complainant(s) to complete the formalities and make the payment. Ms. Ekta Jhanji and Sh. Parveen Jain, Advocates, Counsel for the Opposite Parties, on instructions, stated that the Opposite Parties are not insisting upon contingent deposit of Vat at this stage, subject to furnishing of an affidavit by the allottee(s) to make the payment as and when demanded by the Government. It was further stated that the complainants need not pay Advocate charges and stamp duty and registration charges would be payable by the complainant(s) at the time of execution of sale deed; however, incidental expenses for the same shall be borne by the complainants.

38.        In all the aforesaid six complaints, as stated by Counsel for the Opposite Parties, during arguments, amount(s), demand(s) whereof was raised vide offer of possession letters, minus contingent deposit of vat, stood deposited by the complainant(s), in terms of this Commission orders dated 09.01.2017/13.01.2017. The requisite documents have also been submitted by the complainant(s) except in complaint bearing No.27 of 2017.

39.        In complaint No.23 of 2017, at Sr. No.2 in above table, only an amount of Rs.4,000/- remained to be paid by the complainant(s) to the Opposite Parties.

40.        However, in complaint No.28 of 2017, in which, possession of the unit, in question, was offered on 08.06.2016, demand on account of stamp duty & registration charges was also raised. In this case, the complainant was required to make payment within 30 days but he made payment of the demand raised except stamp duty & registration charges & contingent deposit of vat only on 04.03.2017. Thereafter, he also submitted the documents with the Opposite Parties. It was stated during arguments that nothing remained due against the complainant. The Counsel for the complainant stated that in terms of directions issued by this Commission despite payment by the complainant, possession of the unit, in question, has not been delivered by the Opposite Parties.

41.        It was stated by Counsel for the Opposite Parties that the snags/deficiencies, if any, will be removed, before delivering possession.

42.        Therefore, in all aforesaid complaints, the complainants are entitled to compensation by way of grant of 12% interest, for the delayed period, up-to the date of offer of possession plus 2 months (30 days for making payment + 30 days grace period), as under:-

 

Sr. No.	Complaint No.	Date of offer of possession	Date up-to which entitled to compensation
1.	8/2017	05.10.2016	04.12.2016
2.	23/2017	26.10.2016	25.12.2016
3.	25/2017	15.11.2016	14.01.2017
4.	26/2017	26.10.2016	25.12.2016
5.	27/2017	10.10.2016	09.12.2016
6.	28/2017	08.06.2016	07.08.2016

 

43.        If after deposit of amount minus contingent deposit of vat and submission of requisite documents, possession is not delivered, for delay beyond 30 days, the complainants shall be further entitled to compensation by way of interest @12% p.a. on the deposited amount.

44.        In one consumer complaint bearing No.24 of 2017, particulars of which are given hereunder, as is apparent from order dated 27.02.2017, possession of the unit, in question, stands delivered to the complainants on 23.02.2017, in terms of order dated 13.01.2017 passed by this Commission, after deposit of the amount on 19.01.2017 & 13.02.2017, towards demands raised vide offer of possession letter, minus the demand qua component of contingent deposit of vat. This was admitted by the Counsel for the parties during arguments.

 

1.	Date of independent Floor Buyer’s Agreement.	01.12.2010
2.	Due date for possession after 2 years plus 1 year extended period	30.11.2013
3.	Date on which possession offered.	29.10.2016
4.	Date on which possession taken	23.02.2017

 

45.        The complainants are held entitled to compensation @12% p.a. interest for the delay period, after 2 years plus 1 year extended period, up-to + 2 months from the date of offer of possession.

46.        The complainant(s) in the aforesaid complaints, are also entitled to compensation for mental agony, harassment and deficiency in rendering service.

47.        In Consumer Complaints bearing Nos.8, 25, 26, 27 & 28 all of 2017, the complainants are held entitled to compensation in the sum of Rs.1,50,000/- in each case, on account of mental agony, physical harassment and deficiency in service.

48.        However, in Consumer Complaint bearing No.23 of 2017, there has been DLI in the sum of Rs.63,363.63, against the complainants. Delay in payment of installments partly contributes to delay in completion of unit. Therefore, the complainants, in this case, are not entitled to same amount of compensation. Grant of compensation in the sum of Rs.1,25,000/-, in each case, would served the ends of justice.

49.        In Consumer Complaint bearing No.47 of 2017, details whereof are given hereunder, possession of the unit, in question, has not been offered to the complainant by the Opposite Party:-

 

1.	Date of independent Floor Buyer’s Agreement.	14.02.2011
2.	Whether original allottee?	Yes
3.	Due date for possession after two years plus one year extended period	13.02.2014
4.	Date of receiving Occupation Certificate.	21.10.2016

 

In this case, the occupation certificate of the unit, in question, has been obtained by the Opposite Party on 21.10.2016. As stated above, in this case, possession of the unit, in question, has not been offered/delivered by the Opposite Party to the complainant. Therefore, in view of observations made in the preceding paras, the complainant, in this case, is held entitled to possession of the unit, in question, complete in all respects on payment of amount due, 12% p.a. interest on the deposited amount for the delayed period beyond three years i.e. from 14.02.2014 till possession is handed over and compensation in the sum of Rs.1,50,000/-.

50.          In consumer complaint bearing No.93 of 2017, particulars whereof are indicated below, the  complainants have sought refund of the deposited amount:-

1.	Amount deposited. (Rs.)	Rs.39,40,569.56
2.	Date of Agreement.	10.01.2011
3.	Due date for offering possession after 2 years plus 1 year extended period.	09.01.2014
4.	Whether possession offered	Yes on 10.10.2016
5.	Delay in offer of possession	2 Years 9 Months 26 Days
6.	Whether first allottee	Yes
7.	DLI	Rs.84,574.44

 

51.        In the Chart submitted by the Counsel for the Opposite Parties, during arguments, receipt of the amount as shown against the Column ‘Amount deposited (Rs.)’ at Sr. No.1 in the table, has been admitted.

52.        As is evident from record of this complaint, the Independent Floor Buyer’s Agreement was executed on 10.01.2011. As per Clause 11(a) of the Agreement, the Company was to endeavor to complete construction of the independent floor within a period of 24 months from the date of execution of the agreement unless there was delay or failure due to reasons mentioned in Clauses 11(b) and 11(c) or due to failure of the allottee to pay in time the total price and other charges, taxes and cesses, 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 the Agreement. Clause 12 of the Agreement stipulated that company upon obtaining certificate of occupation and use from the Governmental Authority, shall offer in writing, possession of the independent floor to the allottee in terms of the Agreement to be taken within 30 days from the date of issue of such notice and the Company shall give possession provided the allottee is not in default of any terms and conditions of the Agreement and has complied with all provisions, formalities, documentation etc., as may be prescribed by the Company in this regard. The possession of the unit, in question, has been offered on 10.10.2016. Three years period for handing over possession expired on 09.01.2014 from the date of the Agreement which was executed on 10.01.2011. No reason or circumstances, which were beyond the control of the Opposite Parties for such delay beyond initial period of two years and one year extended period, have been explained. There is, thus, inordinate delay in offering possession of the allotted unit. 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, in the light of law settled by Hon’ble National Commission in such cases, held that the complainants are entitled to refund of the amount deposited by them with the Opposite Parties. 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  complainants 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. Recently 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 complainants, in this complaint, are held entitled to refund of the amounts alongwith interest @15% per annum from the dates of respective deposits.       

53.        There has been DLI in the sum of Rs.84,574.44, against the complainants. Delay in payment of installments partly contributes to delay in completion of unit. Therefore, grant of compensation in the sum of Rs.1,50,000/-, in this case viz. CC/93/2017, would serve the ends of justice.

54.        No other point, was urged, by the Counsel for the parties, in all the cases.

55.        For the reasons recorded above, all the complaints bearing Nos.831 of 2016, 8, 23, 24, 25, 26, 27, 28, 47 & 93 all of 2017 are partly accepted, with costs, in the following manner:-

Consumer Complaints bearing No:

 

831 of 2016, 8, 23, 25, 26, 27 & 28 all of 2017

 

             In these cases, the Opposite Parties have offered possession in October 2016 and November 2016, (except complaint bearing No.28 of 2017, in which possession was offered on 08.06.2016). The amount towards demand raised, except the demands towards, contingent VAT deposit and Advocate charges stands deposited by the complainants in all the above cases, except complaint No.831 of 2016. The Opposite Parties shall hand over possession after removing the snags within 3 weeks.

             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), within a period of 30 days, from the date  balance payment, whereever due, is made/documents are completed  by the complainant(s).
(ii)	Execute and get registered the sale deed 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 11.01.2014, 11.01.2014, 17.01.2014, 20.01.2014, 18.01.2014, 06.01.2014 & 12.01.2014 respectively up-till two months from the date of offer of possession i.e. up-to 14.01.2014, 04.12.2016, 25.12.2016, 14.01.2017, 25.12.2016, 09.12.2016 & 07.08.2016 respectively, 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, till realization.              For failure of Opposite Parties to deliver possession within 30 days from the date of making payment by the complainants, 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 10th of the following month and failure shall entail penal interest @15% p.a. instead of 12% p.a. till payment is made.
(iv)	Pay compensation in the sum of Rs.1,50,000/-, in each case i.e. [in CC No.831 of 2016, 8, 25, 26, 27 & 28 all of 2017], and Rs.1,25,000/- in  CC No.23 of 2017 on account of mental agony, physical harassment and deficiency in service and Rs.35,000/- as litigation costs, 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:

24 of 2017.

 

             In this case, possession of the unit, in question, stands handed over to the complainants on 23.02.2017.

             The Opposite Party is held liable and directed as under:-

(i)	Execute and get registered the sale deed in respect of the unit, in question, within two months 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 complainant(s).
(ii)	To pay compensation, by way of interest @12% p.a., on the deposited amount, to the complainants, with effect from 01.12.2013 till 28.12.2016, within 45 days, from the date of receipt of a certified copy of this order, failing which, the said amount(s) shall carry penal interest @15% p.a., instead of 12% p.a., from the date of default, 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 amount shall carry interest @12% p.a., from the date of filing the complaint till realization.

Consumer Complaint bearing No:

47 of 2017.

 

 

             The Opposite Party is held liable and directed as under:-

(i)	To hand over physical possession of  the units, allotted in favour of the complainant, complete in all respects, to the complainant, within four months from the date  of receipt of a certified copy of this order, on payment of the amount, by the complainant due against him.
(ii)	Execute and get registered the sale deed in respect of the unit, in question, within one month from the date of handing over of possession to the complainant. The stamp duty, registration charges and incidental expenses, if any, shall be borne by the complainant.
(iii)	To pay compensation, by way of interest @12% p.a., on the deposited amount, to the complainant, from 14.02.2014 till 31.05.2017, within 45 days, from the date of receipt of a certified copy of this order, failing which, the said amounts shall carry penal interest @15% p.a., instead of 12% p.a., from the date of default, till realization.
(iv)	To pay compensation by way of interest @12% p.a. on the deposited amount, to the complainant w.e.f. 01.06.2017, onwards (per month), till possession is delivered, by the 10th of the following month, failing which, the same shall also carry penal interest @15% p.a., instead of 12% p.a.,  from the date of default, till payment is made.
(v)	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 complainant, 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 till realization.

            In all these complaints, 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).

             As regards the amount of contingent Vat deposit, the complainant(s) shall furnish an affidavit to make the payment as and when demanded by the Government. The amount of contingent vat, shall be payable by the complainant(s) as and when the same becomes payable by the Opposite Parties to the Government. The complainant(s) shall deposit contingent vat within three weeks from the date the same is paid by Opposite Parties to the Government and the complainant(s) are informed of this fact. Delay beyond three weeks from the receipt of notice shall attract simple interest @12% per annum.

Consumer Complaints bearing No:

93 of 2017.

 

             The Opposite Parties  are, jointly and severally, held liable and directed as under:-

 (i)  To refund the amount of Rs.39,40,569.56 alongwith simple interest @15% per annum, to the complainants, from the respective dates of deposits, till realization,, 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 @18% per annum, instead of 15% per annum, from the date of default till actual payment;

 (ii) To pay an amount of Rs.1,50,000/- as compensation for mental agony, physical harassment & deficiency in service and Rs.35,000/- as litigation costs, to the complainants, 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 amount alongwith simple interest @15% per annum from the date of filing the complaint till actual payment;

            However, it is made clear that in case, the complainants have availed loan facility from any financial institutions, such an institution shall have the first charge on the amount payable, to the extent, the same is due against the complainants.

56.        Certified copy of this order, be placed on the file of consumer complaints bearing Nos.8, 23, 24, 25, 26, 27, 28, 47 & 93 all of 2017.

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

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

Pronounced.

05.05.2017

[JUSTICE JASBIR SINGH (RETD.)]

PRESIDENT

 

 

 

(DEV RAJ)

MEMBER

 

 

 

(PADMA PANDEY)

MEMBER

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