Chandigarh

StateCommission

CC/94/2016

D.S. Dhanda - Complainant(s)

Versus

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

Narender Yadav

02 Jun 2016

ORDER

 STATE CONSUMER DISPUTES REDRESSAL COMMISSION, U.T., CHANDIGARH

 

Complaint case No.	:	94 of 2016
Date of Institution	:	14.03.2016
Date of Decision	:	02.06.2016

 

D.S. Dhanda son of Sh.Kishan Lal Dhanda, resident of House No.302, Shakti Apartment, Sector-14, Panchkula, Haryana.

……Complainant

V e r s u s

 

1. DLF Homes Panchkula Private Limited, SCO 190-191-192, Sector 8C, Chandigarh, U.T., Pin-160009, through its Manager/Authorized Signatory/Officer-in-Charge/ Director Sales and Marketing.
2. DLF Homes Panchkula Private Limited, 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 and Marketing.

Site Address:-

The Valley, Sector 3, Kalka-Pinjore Urban Complex

….Opposite Parties

Argued by: Sh.Narender Yadav, Advocate for the complainant.

                  Ms.Ekta Jhanji, Advocate for the Opposite Parties.

 

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Complaint case No.	:	158 of 2016
Date of Institution	:	22.04.2016
Date of Decision	:	02.06.2016

 

Pawan Singh son of Sh.Saroop Singh, resident of Flat No.402, Block-A, Plot No.GH-105, Sector 20, Panchkula, Haryana.

……Complainant

V e r s u s

1. DLF Homes Panchkula Private Limited, SCO 190-191-192, Sector 8C, Chandigarh, U.T., Pin-160009, through its Manager/Authorized Signatory/Officer-in-Charge/ Director Sales and Marketing.
2. DLF Homes Panchkula Private Limited, 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 and Marketing.

Site Address:-

The Valley, Sector 3, Kalka-Pinjore Urban Complex

….Opposite Parties

Argued by: Sh.Narender Yadav, Advocate for the complainant.

                  Ms.Ekta Jhanji, Advocate for the Opposite Parties.

 

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Complaint case No.	:	159 of 2016
Date of Institution	:	22.04.2016
Date of Decision	:	02.06.2016

 

Lt.Col. Amit Singh son of Sh.Dalvir Singh, H.No.37/1, Patterson Square, Ambala Cantt., Haryana.

……Complainant

V e r s u s

1. DLF Homes Panchkula Private Limited, SCO 190-191-192, Sector 8C, Chandigarh, U.T., Pin-160009, through its Manager/Authorized Signatory/Officer-in-Charge/ Director Sales and Marketing.
2. DLF Homes Panchkula Private Limited, 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 and Marketing.

Site Address:-

The Valley, Sector 3, Kalka-Pinjore Urban Complex

….Opposite Parties

Argued by: Sh.Narender Yadav, Advocate for the complainant.

                  Ms.Ekta Jhanji, Advocate for the Opposite Parties.

 

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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 JUSTICE JASBIR SINGH (RETD.), PRESIDENT   

 

              By this order, we propose to dispose of, following cases:-

1	CC/94 of 2016	D.S. Dhanda	Vs	DLF Homes Panchkula Private Limited and anr.
2	CC/158 of 2016	Pawan Singh	Vs	DLF Homes Panchkula Private Limited and anr.
3	CC/159 of 2016	Lt.Col. Amit Singh	Vs	DLF Homes Panchkula Private Limited and anr.

 

2.        Arguments were heard in common, in the above cases, as the issues involved therein, except minor variations, here and there, of law and facts are the same.
3.        At the time of arguments, on 27.05.2016, it was agreed between Counsel for the parties, that facts involved in the above complaints, by and large, are the same, and therefore, these three complaints can be disposed of, by passing a consolidated order.
4.        Under above circumstances, to dictate order, facts are being taken from consumer complaint bearing No. 94 of 2016, titled as D.S. Dhanda Vs. DLF Homes Panchkula Private Limited and anr. The complainant, who is a retired employee, has filed this consumer complaint seeking possession of the unit, allotted to him, by the opposite parties. It is case of the complainant that copy of the brochure Annexure C-1, showing rosy pictures of the upcoming project, has been given to the prospective buyers, by the opposite parties. Allured by the facts given in the said brochure and appearing through media, the complainant booked a built-up flat, in the said project, on 30.03.2010 and paid an amount of Rs.4 lacs, towards booking amount. Vide letter dated 03.04.2010, he was allotted flat, bearing no.DVF-E-7/25-FF#217, measuring 1450 square feet saleable area, in a project known as “DLF Valley”, in Sector 3, Kalka-Pinjore Urban Complex, Panchkula, Haryana. Total price of the said unit, including External Development Changes, Infrastructure Development  Charges etc. was fixed at Rs.35,08,999.69Ps. plus taxes payable as per law. Buyer’s Agreement was executed between the parties, on 11.02.2011. By that time, the opposite parties had already received an amount of about Rs.10 lacs. As per Clause 11 (a) of the Agreement, possession of the unit was contemplated to be delivered within 24 months, from the date of execution of the same i.e. upto 10.02.2013, failing which, as per Clause 15, the opposite parties were liable to pay Rs.10/- per square feet, per month, for the period of delay. When this complaint was filed in the year 2016, the complainant had already paid an amount of Rs.32,18,158/-. It is grievance of the complainant that within the given time i.e. 10.02.2013, delivery of possession of the unit was not in sight. The opposite parties issued an advertisement in a newspaper namely “Hindustan Times” on 13.01.2014, much after the cutoff date, promising that possession of the units, will be handed over in the year 2014. Even thereafter, possession of the unit was not offered to the complainant. Many queries raised by the complainant, through various letters/emails were not even replied by the opposite parties. It is also grievance of the complainant that whatever construction has been raised at the site, is of poor quality and many facilities as per promise made, has not yet been provided. It was averred that on account of non-delivery of possession of the unit, by the stipulated date, the complainant is being forced to live in a rented accommodation, for which he is paying hefty amount of rent to the tune of Rs.15,000/- per month, meaning thereby that additional financial loss has been caused to him. By stating as above, prayer has been made, seeking directions to the opposite parties to deliver possession of the unit, in question, alongwith compensation and litigation expenses.
5.        Upon notice, reply was filed by the opposite parties, wherein assertions made by the complainant were controverted. It was stated that on account of delay in handing over possession of the unit, no loss is going to be caused to the complainant because allotment made to him is cost escalation free. Possession of the constructed unit will be handed over to the complainant at a price, which was fixed in the year 2011. Execution of the Agreement and promise to hand over possession within 24 months, from the date of execution of that Agreement were not controverted. However, it is stated that construction at the site could not be completed, on account of stay granted on construction activities, by the Hon'ble Supreme Court of India, between 19.04.2012 upto 12.12.2012, which caused delay in handing over possession of the constructed unit to the complainant. It was further stated that to get extension of time of one year, to handover possession of the unit, consent was sought from the complainant vide letter dated 05.06.2013 Annexure R-9 and in the alternative, it was open to him to get back the money deposited by him, alongwith simple interest @9% p.a.. However, the said option was not exercised by the complainant. It is stated that as on date, when reply was filed, construction of 258 independent floors is complete and another 1517 built-up units are near completion. Even occupation certificates have been received for aforesaid 259 units and as on date 86 units have been offered for possession to the owners. Not only this, even completion certificate in respect of the project, has been obtained from the Competent Authorities. It is stated that when construction is not complete, on account of force majeure circumstances, the complainant is only entitled to get delayed compensation. It is asserted that the unit, in question, was purchased for future gain, as such, the  complainant would not fall within definition of a consumer, as defined under Section 2 (1) (d) of 1986 Act. It was also pleaded that time is not the essence of contract. It is pleaded that construction of the units, is in full swing and offer of possession, will be given to the complainant shortly. Even, facilities/amenities to be provided, are on the verge of completion and the same will be provided to the buyers, in coming days.     
6.        On merits, it was admitted that the unit was sold to the complainant. Amount so received and further that possession could not be delivered in time, for want of complete construction, was also admitted. It was averred that the complainant defaulted in making payment of installments, towards the said unit. It is further stated that not only as above, other reasons for delay in starting construction work, at the site are, delay in sanction/ revision of layout plans by the Competent Authorities; delay in approval of service plans and various other approvals/sanctions etc. by the Competent Authorities. It is further said that the complainant will be compensated, by making payment of compensation for the period of delay in handing over the possession, by the opposite parties, as per Clause 15 of the Agreement. It is a contractual obligation between the parties to be discharged, as such, this Commission has no jurisdiction to entertain the complaint and only the Civil Court has jurisdiction. It is stated that terms and conditions of the Agreement are binding upon the parties. Prayer was made, to dismiss the complaint, filed by the complainant.  
7.        In the rejoinder filed, the complainant reiterated all the averments contained in the complaint and repudiated those, contained in the written version of the opposite parties.
8.        The parties led evidence, in support of their cases by filing their affidavits to support their averments. Large number of documents were also placed on record, to strengthen their respective pleas.
9.        We have heard Counsel for the parties, and, have gone through evidence and record of all the cases, very minutely. 
10.        At the time of arguments, besides raising arguments, as reflected in the reply filed, an additional issue was raised by Counsel for the opposite parties that in view of Section 8 of the Arbitration and Conciliation Act, 1996 [as amended vide the Arbitration and Conciliation (Amendment) Act, 2015], to settle disputes between the parties, the matter is required to be referred to an Arbitrator, as such, this Commission has no jurisdiction to entertain the same (complaint).
11.        Counsel for the complainant, by making reference to the facts mentioned in earlier part of this order, stated that it is a case of failed promise on the part of the opposite parties i.e. after receipt of substantial amount of Rs.32,18,158/- (about 90% of the sale consideration), possession of the unit, in question, has not been delivered to the complainant, within the agreed period. The complainant had agreed even to extension of period of 12 months. During that extended period also, possession of the unit was not delivered. Even as on today, construction of the unit is not complete. By stating as above, it is argued that the said act of the opposite parties amounted to deficiency in providing service and also they indulged into unfair trade practice, by making false promise with a view to extract money from the poor customers. It is stated by him that it is a good case, where the complaint needs to be allowed in toto.      
12.        Above contentions were controverted by Counsel for the opposite parties. It is stated 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. It is stated that reasons, referred to above, for delay in delivery of possession, were intimated to the complainant. Promise was made to hand over possession of the unit, within extended period of 12 months. To the said proposal, the complainant agreed and in furtherance to that, he also had deposited further amount, towards sale consideration of the unit, in question, which obviously means that he has given consent to extend the date of delivery of possession by 12 months. At this stage, it is not open to him, to claim the said relief i.e. compensation for mental agony and physical harassment; interest on the deposited amount till delivery of possession of the unit etc.  It is further stated that construction activities at the site were stopped on account of force majeure circumstances, which were beyond the control of the opposite parties, as referred to above. It is averred that only the Civil Court has   jurisdiction   to   entertain   the present   complaint. The   complainant at the best can only claim penal amount/ compensation, as envisaged in Clause 15 of the Agreement, qua   delay  caused to deliver possession   of   the unit, as time was not essence of contract. On facts, no serious dispute was raised.
13.        After hearing arguments of Counsel for the parties, and on going through the evidence, on record, we are inclined to grant relief to the complainant, in terms of prayer made by him. The complainant is a retired employee and he applied for the constructed unit, with a hope that he will get shelter, over his head, alongwith his family members but his hopes were shattered. It is not in dispute that the unit, in question, was allotted to the complainant on 03.04.2010. It is also not in dispute that as per payment plan, he continued to make payment of installments. When Buyer’s Agreement was signed between the parties, on 11.02.2011, he had already paid substantial amount of around Rs.10 lacs. As per Clause 11 (a) of the Agreement (at page 110 of the file), it is evident that possession of the unit was to be delivered within 24 months, from the date of execution of that Agreement i.e. on or before 10.02.2013, subject to force majeure circumstances. In case of failure of the same, 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 upto 12.12.2012 i.e. for about 8 months. Even by that time, limit to provide possession to the complainant had not yet expired. 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 complainant was sought, vide letter dated 05.06.2013, to complete construction within further 12 months. Option was also given to the complainant, to seek refund of his amount deposited, alongwith simple interest @9% P.A. The complainant exercised former option and continued to make payment thereafter and by the time, the complaint was filed, he had paid an amount of Rs.32,18,158/- (about 90% of the sale consideration), towards basic sale price and other charges. The extended period expired on 10.02.2014, even then, possession of the unit was not offered to the complainant. Construction of the unit, is not complete, even as on today. Reading of written statement makes it very clear, that still no firm date to hand over possession of the unit has been given. At the time of arguments, Counsel for the opposite parties very hesitantly disclosed that construction at the project site is not complete and even today, unit is not ready for delivery of possession.

              Above act of the opposite parties amounted to deficiency in providing service. They have also indulged into unfair trade practice, by making false promises to the complainant. As per the Agreement, construction of unit was to be completed by 10.02.2013 (24 months from 11.02.2011), or at the most within the extended period i.e. latest by 10.02.2014. Despite receiving huge amount of Rs.32,18,158/-, against Rs.35,08,999.69Ps., the construction  is not complete, even after a lapse of about five years, from the date when Buyers’ Agreement was executed between the parties.

14.        It may be stated here that the force majeure circumstances, which have been claimed by the opposite parties, for not completing development and construction work, at the site are; delay in sanction of layout plans by the Competent Authorities;  delay in approval of service plans and various other approvals/ sanctions/clearances etc. by the Competent Authorities; and also stay on construction on the land, in question,  granted by the Hon'ble Supreme Court of India, in the case of Ravinder Singh and Ors. Vs. State of Haryana and Others, SLP 21786-21788 of 2010, vide order dated 19.04.2012, which was finally vacated on 12.12.2012.                     However, the question arises, as to whether, the aforesaid circumstances, encountered by the opposite parties, can be termed as force majeure circumstances, for non-development & construction work at the site and non-delivery of possession of the units, by the stipulated date; within the extended period of 12 months, or even as on today, or not.

              First coming to the plea taken by the opposite parties regarding delay in sanction of final lay-out plans by the Authorities, it may be stated here that the said plea does not merit acceptance. It was bounden duty of the opposite parties, to get approved the final layout plans, in respect of the project, in question, before launching the project, and only, thereafter, accept booking amount from the customers. The complainant including other allottees cannot be penalized for the delay in the aforesaid sanction of layout plans. If the opposite parties chose to accept booking, on the basis of provisional sanction of the layout plan, by the Competent Authorities, it is to blame to only themselves, for the delay, and not the purchasers of units. The purchaser of a unit, who had nothing to do with the sanction of the layout plans, by the Competent Authorities, cannot be penalized, by postponing the possession or registration of the unit. Similar view was taken by the National Commission in a case titled as M/s. Narne Constructions Pvt. Ltd. Vs. Dr. Devendra Sharma & 4 Ors., Revision Petition No. 4620 of 2013, decided on 17^th Dec 2015. As such, the plea raised by the opposite parties, in this regard, stands rejected.

              In our considered opinion, it is the duty of the builder, to obtain the requisite permissions or sanctions, in the first instance, and, thereafter, recover/accept the consideration money from the purchaser of the flats/plots. It is a known fact that delay occurs in obtaining various permissions from different Governmental Authorities, and this fact is well-known to the builder(s). The time normally taken in getting such permissions could have been contemplated by the builder, before issuing the brochure. It is an unfair trade practice, if the builder, without any planning and without obtaining any effective permissions/ sanctions/licence to allot plot or to construct building/ apartments, invites offers and collects money from the buyers. If the possession of unit, as also the construction of the building/apartment is delayed, because of such reasons, and the possession thereof is not delivered within the stipulated time, the builder itself is responsible for that, and it cannot take shelter under force majeure circumstances. It was also so said by the National Commission, in a case titled as Kamal Sood Vs. DLF Universal Ltd., III (2007) CPJ 7 (NC). In that case also, a similar plea regarding non-grant of various sanctions, approvals and certificates in respect of the DLF project, by the Government concerned, resulting into delay in delivery of possession of the unit, was raised by the Builder. However, the National Commission in that case, while brushing aside the said plea of the builder, observed and held as under:-

“The main questions which require consideration in the appeal are—

(i)  Can a builder give alluring advertisement promising delivery of possession of the constructed building/flat to the purchaser/ consumer within the stipulated time, and, subsequently, on his failure, turn around and contend that as governmental permissions, such as, approval of zoning plan, layout plan and schematic building plan, were not given, the delay in construction should not be the ground for grant of compensation to the consumer? And,

(ii)   Secondly, whether the consumer should suffer by paying escalation cost due to such delay?

2. In our view, it is unfair trade practice on the part of the builder to collect money from the prospective buyers without obtaining the required permissions such as zoning plan, layout plan and schematic building plan. It is the duty of the builder to obtain the requisite permissions or sanctions such as sanction for construction, etc., in the first instance, and, thereafter, recover the consideration money from the purchaser of the flat/buildings.

3. Secondly, in such a case, if there is any express promise that the premises would be delivered within the stipulated time, and, if not done so, escalation cost is required to be borne by the builder.”

             The principle of law, laid down in the aforesaid case, is fully applicable to the present case. In this view of the matter, plea of the opposite parties, to this effect, also stands rejected.

15.        So far as the plea that the delay was caused on account of stay by the Hon'ble Supreme Court of India, in a case of Ravinder Singh and Ors. Vs. State of Haryana and Others, SLP 21786-21788 of 2010, is concerned, it may be stated here that the said stay was granted on 19.04.2012 and was vacated on 12.12.2012. The said stay order was not specific to the opposite parties, directions were issued to the Government only, not to undertake construction on the land in question. At the maximum taking a stay order, as an order to the opposite parties/builder also, benefit of only about 08 months (stay granted on 19.04.2012 and vacated on 12.12.2012) can be given and not beyond that. It was not clarified by the opposite parties, as to what stopped them to start construction and development work before 19.04.2012 and, thereafter, from 12.12.2012, the date when stay aforesaid was vacated, and complete the same. Even in the extended period, the opposite parties failed to fulfill their promise to deliver possession of the unit, after complete construction. At the same time, as has been held above, if the opposite parties did not take requisite approvals/sanctions, from the Competent Authorities, before launching the project, in question, they cannot take shelter under the force majeure clause, to defeat the claim of the complainant.

              A similar plea, with regard to force majeure circumstances, was taken by the opposite parties, in another case, filed against them, by similar located allottees in the same project, titled as Mrs.Raj Rani and another Vs. DLF Homes Panchkula Pvt. Ltd. and another, consumer complaint no.252 of 2015. This Commission, vide order dated 22.03.2016 allowed the complaint, by holding as under:-

“The next question, which falls for consideration, is, as to whether the complainants are entitled to refund of the amount deposited by them with interest or not. Clauses 11(a) and 11(b) of Independent Floor Buyer’s Agreement dated 10.02.2011 (Annexure C-2), are extracted hereunder:-

“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.”

No doubt, as per the afore-extracted clauses, the Opposite Parties were to complete the construction of the floor, in question, within a period of 24 months from the date of execution of the Agreement dated 10.02.2011 i.e. by 09.02.2013. However, as admitted by the Opposite Parties, they failed to offer possession within the aforesaid stipulated period of 24 months and vide letter dated 05.06.2013 (Annexure R-3) informed the complainants that they (Opposite Parties) would endeavor to complete the project subject to the delay of 12 months, which occurred due to stoppage of the work because of stay on construction activities. In this letter, the Opposite Parties also informed the complainants that Hon’ble Supreme Court dismissed the SLP No.21786-88/2010 vide its order dated 12.12.2012 and the earlier order dated 19.04.2012 passed by it (Supreme Court) not to undertake further construction  at the project land stood vacated. The Opposite Parties also informed the complainants that if they did not agree to delay of 12 months, they (Opposite Parties) will cancel the allotment and refund the amount deposited with 9% interest. Admittedly, there was no stay as on 12.12.2012 on construction activity. As per own averment of the complainants, in Para 5 of the complaint, they agreed to extension of the period for further 12 months for offering possession of the independent floor, in question. In fact, stay on construction activities was in force for a period of 8 months only. However, the Opposite Parties failed to deliver possession of the floor, in question, complete in all respects, to the complainants within the extended period of 12 months, which expired on 10.02.2014. Till date, or till the date of filing the complaint, which was filed on 28.10.2015, possession has not been offered by the Opposite Parties to the complainants, what to talk of compensation, as envisaged under Clause 13 of the Independent Floor Buyer’s Agreement dated 10.02.2011. Nothing has been placed, on record, by the Opposite Parties, by way of documentary evidence, to the effect that they (Opposite Parties) ever offered possession of the floor, in question, to the complainants during the extended period of 12 months or thereafter or till the filing of the complaint. As conceded during arguments, the Opposite Parties will take another period of three months to offer possession. There is clear cut admission by the Opposite Parties that there was delay in offering possession and they even failed to deliver possession after seeking one year extension, which expired on 10.02.2014, and are not in a position to do so even today. While seeking extension, the Opposite Parties had offered the complainants either to extend the period or seek refund alongwith 9% interest. In the face of such apparent and clear deficiency and delay of more than two years in offering possession, even after the extended period of one year, which elapsed on 10.02.2014, objection taken by the Opposite Parties that the complainants did not make payment of installments in time, being afterthought and unsustainable, stands rejected. There is no specific averment in the written statement that as on date, as to what amount, is payable by the complainants as per Construction Linked Payment Plan. Though the Opposite Parties vide Annexure R-4 (Colly.) have placed copies of letters/reminders sent to the complainants regarding outstanding payment(s) but perusal of these annexures clearly reveal that the complainants made payment thereof, as is evident from the receipts placed on record, vide Annexure R-4 (Colly.). The complainants had made payments in the sum of Rs.51,91,736/- to the Opposite Parties, which was undoubtedly their hard earned money. Clearly they needed a residential unit and instead of seeking refund, as offered by the Opposite Parties, they agreed to extension of one year, which too expired on 10.02.2014. When the Opposite Parties themselves failed to deliver possession to the complainants even by the extended period and till date, they are liable to refund the entire amount paid by the complainants with interest. Further, when the Opposite Parties were ready to refund the deposited amount in June, 2013 (Annexure R-3) alongwith 9% interest, their objection to refund the deposited amount is not tenable. As regards reliance on Clause 14 of the Independent Floor Buyer’s Agreement dated 10.02.2011 by the Opposite Parties, it may be stated here that the instant complaint was filed on 28.10.2015 seeking refund of the deposited amount, itself amounts to giving notice for terminating the Agreement. As already stated above, possession was to be delivered by  09.02.2013 and the complainants very fairly, on the asking of the Opposite Parties, extended the same for one year i.e. up to 10.02.2014. Even the extended period expired on 10.02.2014 and still the Opposite Parties are not in a position to offer possession. The complainants are, thus, entitled to refund of Rs.51,91,736/- with simple interest @15% per annum. By not refunding the deposited amount, the Opposite Parties were deficient in rendering service.”

 

              Similar view was reiterated by this Commission, in another similar case, titled as Nisha Gupta Vs. DLF Homes Panchkula Pvt. Ltd. and ors., consumer complaint no.295 of 2015 decided on 18.04.2016 (alongwith 3 connected cases). In view of the above, no help, therefore can be drawn, by the opposite parties, from the pleas raised by them, for non-delivery of possession of the constructed unit, to the complainant.   

16.        To defeat claim of the  complainant, another objection was raised by Counsel for the opposite parties, that the complainant is a speculator, as he has purchased the unit, in question, for earning profits i.e. for resale, as and when there is escalation in the prices of real estate, therefore, he would not fall within the definition of consumer, as defined by Section 2 (1) (d) (ii) of the Act, or not.

              It may be stated here that there is nothing, on the record to show, that the complainant is property dealer, and is 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. In a case titled as Kavita Ahuja Vs. Shipra Estate Ltd. and Jai Krishna Estate Developer Pvt. Ltd. Consumer Complaint No.137 of 2010, decided on 12.02.2015, by the National Consumer Disputes Redressal Commission, New Delhi, it was held 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. Similar view was reiterated by the National Commission, in DLF Universal Limited Vs Nirmala Devi Gupta,  Revision Petition No. 3861 of 2014, decided on 26.08.2015. The principle of law, laid down, in the aforesaid cases, 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 complainant, by way of investment, with a view to earn profit, in future. The complainant, thus, falls within the definition of ‘consumer’, as defined under Section 2(1)(d) of the Act. Such an objection, taken by Counsel for the opposite parties, therefore, being devoid of merit, is rejected.  

17.        The next question, that falls for consideration, is, as to whether, time was essence of the contract or not. It may be stated here that the plea taken by the opposite parties, in this regard, is also devoid of merit, in view of Clauses 11 (a) and 15 of the Buyer’s Agreement, according to which, possession of the unit, in question, was to be delivered within a maximum period of 24 months, from the date of execution of the same, failing which they were liable to pay compensation/penalty @ Rs.10/- per square feet of the saleable area, per month, for the period of delay, in case they encountered force majeure circumstances. The time was, thus, unequivocally made the essence of contract. The plea taken by the opposite parties, in this regard, also stands rejected.
18.        The next question, that falls for consideration, is, as to whether, the instant consumer complaint is not maintainable, and only a Civil Court can decide the case. It may be stated here, that the complainant hired the services of the opposite parties, for purchasing the unit, in the manner, referred to above. As stated above, according to Clause 11 (a) of the  Agreement, the opposite parties were liable to deliver physical possession of the unit, within a period of 24 months months, from the date of execution of the same (Agreement), with complete basic amenities, as provided in the brochure and necessary for living a smooth and comfortable life. 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”

              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, Section 3 of the 1986 Act, provides an alternative remedy. Even if, it is assumed that the complainant has a remedy to file a suit, in the Civil Court, the alternative remedy provided under Section 3 of the Act, can also be availed of by him, as he falls within the definition of consumer. In this view of the matter, the objection of the opposite parties, in this regard, being devoid of merit, must fail, and the same stands rejected.

19.        The next question, that falls for consideration, is, as to whether, the ground taken by the opposite parties, at the time of arguments, 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. It may be stated here that the objection raised by the opposite parties, in this regard, deserves rejection, in view of the judgments passed by this Commission in Abha Arora Vs. Puma Realtors Pvt. Ltd. and another, consumer complaint No.170 of 2015, decided on 01.04.2016 and Praveen Kumar Arora and another Vs. Emaar MGF Land Limited, Consumer Complaint no.198 of 2015, decided on 04.04.2016, wherein this issue was dealt, in detail, while referring various judgments of the Hon'ble Supreme Court of India; the National Commission, New Delhi, and also Section 3 of the Consumer Protection Act, 1986. Ultimately it was held by this Commission that even 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 jurisdiction to entertain the consumer complaint. It was also so said by the National Commission, recently, 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.”

              In view of the above, and also in the face of ratio of judgments, referred to above, the arguments raised by Counsel for the opposite parties, stands rejected.

20.        The opposite parties are also guilty of adoption of unfair trade practice. It is on record that the complainant booked the unit, in question, in the project aforesaid, in the year 2010. He was allotted the unit, vide letter dated  03.04.2010, on which date, he had paid an amount of Rs.4 lacs. Buyer’s Agreement was not put for signing in a reasonable time, say two to three months. He continued to make payment and when Buyer’s Agreement was got signed, on 11.02.2011, he had already paid an amount of around Rs.10 lacs. By not offering Buyer’s Agreement, for signing in a reasonable time, the opposite parties also committed unfair trade practice.
21.        The next question, that falls for consideration, is, as to whether, the complainant is entitled to delivery of possession of the unit. 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). On account of force majeure circumstances, referred to above, by giving them advantage of 12 months extended period, consent whereof, had been obtained from the complainant, the opposite parties were required to deliver possession on or before 10.02.2014, but not later than that. However, it is an admitted fact that possession of the unit, in question, has not been offered, even by the date of filing the instant complaint, or even till date, despite the fact that more than 90% of the sale consideration i.e. Rs.32,18,158/-  out of Rs.35,08,999.69Ps., has been paid by the complainant, for want of basic amenities at the site.  No doubt, the opposite parties averred in their written version, that possession of unit, is expected to be delivered to the complainant, shortly, yet, they failed to place, on record, any cogent and convincing evidence, that  construction of the unit is going to be complete in the near future and also that development in area is in progress. By making a misleading statement, that possession of the unit, was to be delivered within the 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 10.02.2014, 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 complainant is certainly entitled to physical possession of the unit, in question.
22.       The next question, that falls for consideration, is, as to whether, the complainant is entitled to compensation, if so, at what rate, for non-delivery of physical possession of the unit. Earlier, in a case titled as Narender Kumar Yadav Vs. DLF Homes Panchkula Pvt. Ltd. and another, consumer complaint no.224/2015 decided on 13.01.2016, this Commission, had granted compensation @ Rs.10/- per square feet of the saleable area (as provided in the Agreement), alongwith interest, to the complainant, for the period of delay. However, recently in Parsvnath Exotica Ghaziabad Resident's Association Vs. Parsvnath Buildwell Pvt. Ltd. & Anr., consumer complaint no.45/ 2015, decided by the Hon’ble National Commission, on 06.05.2015, under similar circumstances, interest on the deposited amount, for the period of delay was granted, by holding as under:-

“Though, the Agreement between the developer and the flat buyers provides for payment of compensation in case of delay @ Rs.5/- per square feet of the super area per month, such clauses have been found to be unfair trade practice and have been consistently rejected by this Commission in several decision, including  Consumer Complaint No. 427 of 2014 Satish Kumar Pandey & Ors. Vs. Unitech Ltd. and connected matters decided on 08.6.2015.  Therefore, the aforesaid clauses cannot be taken into consideration, while determining the compensation payable to the members of the complainant association for the aforesaid delay in completion of construction.”

23.       Not only this, in another case, titled as 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 reads 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.”

24.       No doubt in the Buyer’s Agreement, some scope for delay due to unavoidable circumstances was kept in mind, for compensating the complainant 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 complainant 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.  If the argument of the opposite parties 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 its other business venture, at nominal interest of 3 to 4 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. Thus, keeping in view the principle of law laid down by the Hon'ble National Commission, in the cases, referred to above, if interest @12% on the deposited amount for the period of delay, till delivery of possession of the unit, is awarded, that would meet the ends of justice.
25.       The next question, that falls for consideration, is, as to whether, the complainant is entitled to compensation, under Section 14(1)(d) of the Act, on account  of mental agony and physical harassment, and injury caused to him, for a long number of years, by not delivering physical possession of the unit to him, by the opposite parties, by the promised date in the Agreement or latest by 10.02.2014 i.e. within the extended period. The complainant purchased the unit, with the hope to have a roof over his head alongwith with his family members but his hopes were dashed to the ground. Even the possession of unit, in question, was not offered to the complainant, till date i.e. even after the expiry of a period of more than about five years, from the date of allotment and more than about two years, from the stipulated date, by the opposite parties, what to speak of delivery thereof. The complainant underwent a lot of mental agony and physical harassment, on account of the acts of omission and commission of the opposite parties. Compensation, on account of mental agony and physical harassment, caused to the complainant, due to the acts of omission and commission of the opposite parties, if granted, to the tune of Rs.3 lacs, shall be reasonable, adequate and fair. The complainant, is, thus, held entitled to compensation, in the sum of Rs.3 lacs.
26.       Another additional argument was raised by Counsel for the opposite parties, while placing reliance on a case titled Haryana Urban Development Authority Vs. Raje Ram, Civil Appeal No.2381 of 2003, decided on 23.08.2008, by the Hon’ble Supreme Court,  to the effect that since in consumer complaints no.158 of 2016 and 159 of 2016, the complainants are subsequent allottees and when they had purchased the units, in question, in re-sale, delay in delivery of possession had already been caused and further delay was in their notice, as such, they are not entitled to any compensation. It is not in dispute, that the complainants, in the consumer complaints, referred to above, had purchased the units, in resale, from the original owners. Both the sale transactions were endorsed by the opposite parties, in favour of the complainants. No new conditions were imposed, at the time of transfer of the said units, in the name of the complainants, in the said complaints and the conditions already imposed vide the original Agreements, were kept intact. Not only this, when the complainants in the said consumer complaints, have purchased the units, even by that time, extended period to handover possession, has not yet expired. The purchaser(s) can reasonably expect that as per promise made with the original allottee(s), possession of the unit(s) will be delivered in time or may be within the extended period, if agreed. However, it was not done. It is well settled law that once the property is transferred/endorsed, in the name of the buyer from the original owner, he/she (buyer), is vested with all the rights and interests, accrued in favour of his/her predecessor(s), as he/she stepped into her/his shoes. It was also so said by the National Consumer Commission, New Delhi in case Vatika Limited   Vs Mr. Rajneesh Aggarwal, REVISION PETITION NO. 525 OF 2013, decided on 22.07.2014, wherein the complainant was the fourth subsequent allottee. In that case also, the builder relied upon Haryana Urban Development Authority's case (supra), in support of his contention. In that case, the National Commission, held as under:-  

“So far as the case of Raje Ram is concerned, the facts of the present case are totally different. In the present case, the respondent/complainant had purchased the apartment in question from the first transferee on 29.4.2006 when the construction had not been completed and   purchase/transfer of the apartment was duly approved by the petitioner company after charging Rs.65,840/- as transfer charges. In the circumstances, the petitioner company could not deny its role as a service provider to the respondent/complainant and has to be held liable for any deficiency in service with reference to the terms and conditions of the agreement which was made equally applicable to the complainant also consequent upon the approval of the assignment by the petitioner company on 30.4.2006 on payment of the transfer charges to the petitioner company. For the reasons stated above, we do not find any merit in the revision petition and the same is dismissed accordingly but with no order as to costs.”

            The principle of law laid down in the aforesaid case, decided by the National Commission is fully applicable to the present case. In view of the above, the argument raised by Counsel for the opposite parties, being devoid of merit, is rejected.

27.       No other point, was urged, by the Counsel for the parties, in all the cases.
28.       For the reasons recorded above, all the complaints are partly accepted, with costs, in the following manner:-

 

 

Consumer Complaint bearing No.94 of 2016, titled as D.S. Dhanda Vs DLF Homes Panchkula Private Limited and anr. The opposite parties are jointly and severally directed as under:-

 

1. To hand over physical possession of  the unit, allotted in favour of the complainant, complete in all respects, as per the terms and conditions of the Agreement, to the complainant, within a period of four months, from the date  of receipt of a certified copy of this order, on payment of the amount, legally due against him.
2. To execute and get registered the sale deed, in respect of the unit, in question, within one month from the date of handing over possession, as indicated in Clause (i) above, on payment of registration charges and stamp duty, by the complainant, directly to the Registering Authorities concerned.
3. To pay compensation, by way of interest @12% p.a., on the deposited amount, to the complainant, from 10.02.2014 (promised date in view of the extension sought vide letter dated 05.06.2013 i.e. 12 months after the stipulated date as per Agreement i.e. from 10.02.2013) to 31.05.2016, within 2 months, 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., till realization.
4. To pay compensation by way of interest @12% p.a. on the deposited amount, due to the complainant  w.e.f. 01.06.2016, onwards (per month), by the 10^th 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 the delivery of possession.
5. To pay compensation, in the sum of Rs.3 lacs, on account of mental agony and physical harassment, caused to the complainant, within two months from the date of receipt of a certified copy of this order, failing which, the same shall carry interest @12% p.a., from the date of filing the complaint till realization.
6. To pay cost of litigation, to the tune of Rs.50,000/-, to the complainant, within two months from the date of receipt of a certified copy of this order, failing which, the same shall also carry interest @12% p.a., from the date of filing the complaint till realization.

 

Consumer Complaint bearing No.158 of 2016 titled as Pawan Singh Vs DLF Homes Panchkula Private Limited and anr., The opposite parties are jointly and severally directed as under:-

 

1. To hand over physical possession of  the unit, allotted/transferred in favour of the complainant,  in the manner referred in the main complaint, complete in all respects, as per the terms and conditions of the Agreement, to the complainant, within a period of four months, from the date of receipt of a certified copy of this order, on payment of the amount, legally due against him.
2. To execute and get registered the sale deed, in respect of the unit, in question, within one month from the date of handing over possession, as indicated in Clause (i) above, on payment of registration charges and stamp duty, by the complainant, directly to the Registering Authorities concerned.
3. To pay compensation, by way of interest @12% p.a., on the deposited amount, to the complainant, from 24.04.2014 (added 12 months extended period, from the stipulated date i.e. 24.04.2013, in view of advertisement given by the opposite parties in the newspaper, regarding stay aforesaid) to 31.05.2016, within 2 months, 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., till realization.
4. To pay compensation by way of interest @12% p.a. on the deposited amount, due to the complainant  w.e.f. 01.06.2016, onwards (per month), by the 10^th 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 the delivery of possession.
5. To pay compensation, in the sum of Rs.3 lacs, on account of mental agony and physical harassment, caused to the complainant, within two months from the date of receipt of a certified copy of this order, failing which, the same shall carry interest @12% p.a., from the date of filing the complaint till realization.
6. To pay cost of litigation, to the tune of Rs.50,000/-, to the complainant, within two months from the date of receipt of a certified copy of this order, failing which, the same shall also carry interest @12% p.a., from the date of filing the complaint till realization.

 

Consumer Complaint bearing No.159 of 2016, titled as Lt.Col. Amit Singh Vs. DLF Homes Panchkula Private Limited and anr. The opposite parties are jointly and severally directed as under:-

 

1. To hand over physical possession of  the unit, allotted/transferred in favour of the complainant,  in the manner referred in the main complaint, complete in all respects, as per the terms and conditions of the Agreement, to the complainant, within a period of four months, from the date  of receipt of a certified copy of this order, on payment of the amount, legally due against him.
2. To execute and get registered the sale deed, in respect of the unit, in question, within one month from the date of handing over possession, as indicated in Clause (i) above, on payment of registration charges and stamp duty, by the complainant, directly to the Registering Authorities concerned.
3. To pay compensation, by way of interest @12% p.a., on the deposited amount, to the complainant, from 19.12.2013 (promised date in view of the extension sought vide letter dated 02.04.2013 i.e. 12 months after the stipulated date as per Agreement i.e. from 19.12.2012) to 31.05.2016, within 2 months, 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., till realization.
4. To pay compensation by way of interest @12% p.a. on the deposited amount, due to the complainant  w.e.f. 01.06.2016, onwards (per month), by the 10^th 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 the delivery of possession.
5. To pay compensation, in the sum of Rs.3 lacs, on account of mental agony and physical harassment, caused to the complainant, within two months from the date of receipt of a certified copy of this order, failing which, the same shall carry interest @12% p.a., from the date of filing the complaint till realization.
6. To pay cost of litigation, to the tune of Rs.50,000/-, to the complainant, within two months from the date of receipt of a certified copy of this order, failing which, the same shall also carry interest @12% p.a., from the date of filing the complaint till realization.

 

29.        Certified copy of this order, be placed on the file of connected cases, mentioned above.
30.        Certified copies of this order be sent to the parties, free of charge.
31.        The file be consigned to Record Room, after completion.

Pronounced.

02.06.2016_

Sd/-

[JUSTICE JASBIR SINGH (RETD.)]

PRESIDENT

 

 

Sd/-

[DEV RAJ]

MEMBER

 

 

Sd/-

[PADMA PANDEY]

 MEMBER

Rg.