Chandigarh

StateCommission

CC/317/2015

Madhu Chaudhary - Complainant(s)

Versus

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

Gaurav Bhardwaj, Adv.

18 Apr 2016

ORDER

 

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Complaint case No.	:	317 of 2015
Date of Institution	:	22.12.2015
Date of Decision	:	18.04.2016

 

Madhu Chaudhary wife of Late Dilbag Singh Barak, R/o H.No.160, Sector 4, Rohtak, Haryana.

……Complainant

V e r s u s

DLF Homes Panchkula Private Limited, SCO No.190,191,192, Sector 8-C, Chandigarh, through its Managing Director

….Opposite Party

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

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

                MR. DEV RAJ, MEMBER.

                MRS. PADMA PANDEY, MEMBER.

 

Argued by: Sh.Gaurav Bhardwaj, Advocate for the complainant.

                  Ms.Ekta Jhanji, Advocate for the Opposite Party.

 

PER JUSTICE JASBIR SINGH (RETD.), PRESIDENT

            Vide our separate detailed order of the even date, recorded in consumer complaint bearing no.295 of 2015 titled as Nisha Gupta Vs. DLF Homes Panchkula Private Limited and Ors., this complaint has been partly accepted, with costs, as per the directions given therein. 

2.       Certified copy of the order passed in consumer complaint bearing no.295 of 2015, shall also be placed on this file.
3.       Certified copy of the main order, alongwith this order be sent to the parties, free of charge.
4.       The file be consigned to Record Room, after completion.

 

Sd/-                        Sd/-                        Sd/-

(DEV RAJ) MEMBER

(JUSTICE JASBIR SINGH (RETD.)) PRESIDENT

(PADMA PANDEY) MEMBER

Rg

 

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Complaint case No.	:	295 of 2015
Date of Institution	:	02.12.2015
Date of Decision	:	18.04.2016

 

Nisha Gupta wife of Balwinder Kumar Gupta, House No.9/10, Sector 4-C, Battan Lal Road, Mandi Gobindgarh.

……Complainant

V e r s u s

1. DLF Homes Panchkula Private Limited, through its Managing Director, having its Registered Office at 2^nd Floor, Gateway Tower DLF Phase-III, Gurgaon, Haryana.
2. DLF Homes Panchkula Private Limited, through its Authorized Signatory Sh.Mahender Singh son of Mr.Suraj Bhan, SCO 190,191,192, Sector 8C, Chandigarh
3. DLF Homes Panchkula Pvt. Ltd., through its Authorized Signatory Sh.Vinod Kumar son of Lae Sh.D.N. Jha, SCO 190,191,192, Sector 8C, Chandigarh

….Opposite Parties

Argued by: Ms.Meena Bansal, Advocate for the complainant.

                  Ms.Ekta Jhanji, Advocate for the Opposite Parties.

 

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Complaint case No.	:	317 of 2015
Date of Institution	:	22.12.2015
Date of Decision	:	18.04.2016

 

Madhu Chaudhary wife of Late Dilbag Singh Barak, R/o H.No.160, Sector 4, Rohtak, Haryana.

……Complainant

V e r s u s

DLF Homes Panchkula Private Limited, SCO No.190,191,192, Sector 8-C, Chandigarh, through its Managing Director

….Opposite Party

Argued by: Sh.Gaurav Bhardwaj, Advocate for the complainant.

                  Ms.Ekta Jhanji, Advocate for the Opposite Party.

 

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Complaint case No.	:	18 of 2016
Date of Institution	:	11.01.2016
Date of Decision	:	18.04.2016

 

Sanjay Vashisth son of Sh.G.R. Vashisth, resident of House No.A-302, GH-1 (BMD), Sector 23 (Behind Nada Sahib Gurudwara), Panchkula-Haryana.

……Complainant

V e r s u s

DLF Homes Panchkula Private Limited, Chandigarh Technology Park, Plot No.2, Tower D, Ground Floor, Chandigarh U.T., through its Managing Director.

Tel.0172-4607728/441354, FAX-0171-4407737.

Email:- IInd Address:-

At SCO 190,191 & 192, Sector 8-C, Chandigarh-160009, Phone:0172-4607750.

….Opposite Party

Argued by: Sh.Gunjan Mehta, Advocate for the complainant.

                  Ms.Ekta Jhanji, Advocate for the Opposite Party.

 

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Complaint case No.	:	48 of 2016
Date of Institution	:	05.02.2016
Date of Decision	:	18.04.2016

 

Arun Yadav, Advocate, son of Sh.Rao Kehar Singh, Advocate, resident of Flat No.K-42, Group Housing Society No.94, Sector 20, Panchkula.

……Complainant

V e r s u s

DLF Homes Panchkula Private Limited, Chandigarh Technology Park, Plot No.2, Tower D, Ground Floor, Chandigarh U.T., through its Managing Director.

Tel.0172-4607728/441354, FAX-0171-4407737.

Email:- Now present official address:- SCO 190,191 & 192, Sector 8-C, Chandigarh-160009, Phone:0172-4607750.

….Opposite Party

Argued by: Sh.Rajesh Gupta, Advocate for the complainant.

                  Ms.Ekta Jhanji, Advocate for the Opposite Party.

================================================

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:-

	CC/295/2015	Nisha Gupta Vs. DLF Homes Panchkula Private Limited and others
	CC/317/ 2015	Madhu Chaudhary Vs. DLF Homes Panchkula Private Limited
	CC/18/2016	Sanjay Vashisth Vs. DLF Homes Panchkula Private Limited
	CC/48/2016	Arun Yadav Vs. DLF Homes Panchkula Private Limited

 

2.        The issues involved in all these cases, except minor variations, here and there, of law and facts are the same. Arguments were heard in common, in the above cases. It was agreed by Counsel for the parties, in the above complaints, at the time of arguments on 12.04.2016, that vide a consolidated order, the same (the above complaints) be disposed of.
3.       Under above circumstances, to dictate order, facts are being taken from consumer complaint no.295 of 2015,   titled  as Nisha Gupta Vs. DLF Homes Panchkula

 Private Limited and others.

            For her residence purpose, the complainant purchased an independent floor no.A1/32, first floor, in a project launched by the opposite parties, under the name and style of “DLF Valley”, Panchkula. Saleable area of the unit was 2690 square feet. Total price of the said unit, including External Development Changes, Infrastructure Development Charges etc. was fixed at Rs.92,99,329.97Ps. Buyer’s Agreement was executed between the parties, on 27.06.2011. It was a development linked payment plan and the entire payment was to be made within 18 months, on completion of construction of the unit, laying of flooring and tile works etc. As per schedule of payments (Annexure C-3 attached with the Agreement), the complainant paid an amount of Rs.77,80,217/- upto May 2015. It is so reflected in the customer ledger/statement of accounts placed on record at Annexure C-2. 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 26.06.2013. However, it was not done. To make payment of installments, the complainant wanted to raise loan. For the said purpose, copy of the Agreement was needed. Son of the complainant through email dated 09.05.2014 made a request to the opposite parties to supply certified copy of the Agreement, however, it was not done. Request was repeated many times, and ultimately, copy of the Agreement was supplied only on 09.11.2015. Above act, delayed raising of loan by the complainant, to make further payment of installments towards price of the unit. The complainant paid many visits to the project site, however, construction was not in progress. Compelled under such circumstances, she wrote an email dated 25.11.2015 to the opposite parties, in which request was made to refund amount paid alongwith interest, but to no avail.

4.        Upon notice, reply was filed by the Opposite Parties, wherein assertions made by the complainant were controverted. It is contended that construction of the unit was at full swing and possession is likely to be delivered in near future. Execution of the Agreement; 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. The said fact was brought to the notice of the complainant by writing a letter dated 08.07.2013 (Annexure R-6). In the said letter, it was stated that the opposite parties would make an effort to complete the project with delay of 12 months, which had occurred on account of stay aforesaid, granted by the Hon'ble Supreme Court of India and that, in case, the complainant is not agreed, to the said condition, she may get refund of her amount alongwith interest @9% p.a.  It is stated that since confirmation was sought from the complainant, whether she agreed to get possession, with delay period of 12 months or not, but, on the other hand, she continued making payment towards price of the said unit, as such, now she cannot claim refund of the amount deposited alongwith interest and compensation. It is further stated that possession of the unit, in question, could not be offered to the complainant, for want of construction and development work at the site, on account of the reasons beyond the control of the opposite parties, i.e. on account of force majeure circumstances.
5.       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/ clearances etc. by the Competent Authorities. It is further said that the complainant cannot claim refund of the amount paid, in the face of penal provisions to make payment for the period of delay in handing over the possession, by the opposite parties, to her, 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.
6.       During pendency of the complaint, when it was fixed for 24.02.2016, for filing rejoinder on behalf of the complainant, as also evidence of the parties, if any; an application was moved by the opposite parties, under Section 8 (amended) of the Arbitration and Conciliation Act, 1996, for referring the matter to the Arbitration. The said application was taken upon on 26.02.2016, and was disposed of, by this Commission, vide order of the even date, holding that the question qua arbitration will be considered at the time of final arguments, in the main complaint. 
7.         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.
8.       We have heard Counsel for the parties, and, have gone through evidence and record of all the cases, very minutely. 
9.       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.77,80,217/- (about 85% of the entire 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, sought vide letter dated 08.07.2013. During that extended period, 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 her that it is a good case, where the complaint needs to be allowed in toto i.e. refund of the amount deposited alongwith interest (as prayed), from the respective dates of deposits, till realization, compensation and litigation costs.
10.       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 further argued that, may be, taking note of un-amended provisions of Section 8 of 1996 Act vis-à-vis Section 3 of 1986 Act, it had earlier been said that the Consumer Foras have jurisdiction to entertain a complaint, as Section 3 provides additional remedy to the consumers and existence of arbitration clause in the agreement would not bar jurisdiction of the Consumer Foras, however, with amendment in Section 8 of the 1996 Act, position has changed. In a way, she made an attempt to say that amendment in Section 8 of 1996 Act, leaves no power, with the Consumer Foras to entertain any consumer complaint, in cases, wherein provisions for settlement of disputes is provided through arbitration.  It is stated that reasons, referred to above, for delay in delivery of possession, were intimated to the complainant vide letter dated 08.07.2013. 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, she also had deposited further amount, towards sale consideration of the unit, in question, which obviously means that she has given consent to extend the date of delivery of possession by 12 months. Once the complainant in response to a letter dated 08.07.2013, had failed to seek refund of the amount paid, with interest, at this stage, it is not open to her, to claim the said relief. 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. Parties are bound by terms and conditions of the Agreement and at this stage, when construction is near completion; it is not open to the complainant to seek refund of the amount paid. It is averred that only the Civil Court  has   jurisdiction   to   entertain   the present   complaint.    The   complainant   at   the best can   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.
11.       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 her. It is not in dispute that the unit, in question, was allotted in favour of the complainant, vide Agreement dated 27.06.2011. It is also not in dispute that in terms of development linked payment plan, the complainant continued to make payment, towards basic sale price of the unit, including other charges, aforesaid. It is also not in dispute that as per Clause 11 (a) of the Agreement, possession of the unit, after complete construction was to be delivered to the complainant within 24 months from the date of execution thereof i.e. on or before 26.06.2013. In case of failure of the same, as per Clause 15 of the Agreement, she 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. The opposite parties, by making reference to the above mentioned fact, wrote a letter dated 08.07.2013 Annexure R-6, seeking consent of the complainant to extend period, to complete construction by 12 months. Option was also given to the complainant, to seek refund of her amount deposited, alongwith simple interest @9% P.A. The complainant exercised former option and after receipt of above letter, further amount was deposited by her, with the opposite parties. Admittedly, upto May 2015, the complainant had paid an amount of Rs.77,80,217/- towards basic sale price and other charges. The above said act can bind the complainant, not to seek refund within the extended period of 12 months. The said period had expired in July 2014. Even thereafter, possession of the unit, in question, was never offered to the complainant. It is also not  in dispute that to raise loan, the complainant made a request to the opposite parties, to supply certified copy of the Agreement, but it was done after many months, that too, on repeated requests. The complainant failed to raise loan, which resulted into making difficulty for her to make payment of installments, towards price of the said unit.  Construction of the unit, is not completed, even as on today. In the reply filed by the opposite parties, 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.
12.       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 26.06.2013 (24 months from 27.06.2011). However, despite receipt of huge amount of Rs.77,80,217/-, promise to deliver possession of the unit was not fulfilled.
13.       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 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; with 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.

            Now coming to the second plea taken by the opposite parties, to the effect that there was 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, it may be stated here that the same also does not merit acceptance. In our considered opinion, it is the duty of the builder, to obtain the requisite permissions or sanctions, referred to above, 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.”

14.       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 regarding grant 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. Otherwise also, the said stay 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 extended period, the opposite parties failed to fulfill their promise of delivery of 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.
16.       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.”

 

            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.     

17.       The complainant was eager to get a living unit. Keeping that in mind, she even agreed to extend 12 months, to complete the construction, in terms of letter dated 08.07.2013, written by the opposite parties. In view of the extended time, possession was to be delivered by 07.07.2014. No attempt was made to complete the construction and hand over possession of the unit to the complainant even by that date. The present complaint was filed in the month of December 2015. Even on the date, when arguments were heard, qua completion of construction of the unit, in question, no firm date was given by the opposite parties. Above facts entitled the complainant to seek refund of her amount deposited.
18.       Another objection raised by Counsel for the opposite parties that time was not essence of the contract 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. The time was, thus, unequivocally made the essence of contract. The plea of Counsel for the opposite parties in this regard also stands rejected.
19.       Another objection was raised by Counsel for the opposite parties that the 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. 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 Clause 27. 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 her, as she 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.

20.       The next question, that falls for consideration, is, as to whether, the ground taken by the opposite parties, in the application aforesaid, moved on 24.02.2016, 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. Though it is doubtful, as to whether, the said application can be moved at the stage, when written reply and evidence had already been filed by the opposite parties on 10.02.2016, yet, in the interest of justice, this Commission will proceed ahead, to deal with the objection raised by the opposite parties. It may be stated here that under similar circumstances, in a case titled as Abha Arora Vs. Puma Realtors Pvt. Ltd. and another, consumer complaint No.170 of 2015, decided on 01.04.2016, this Commission, brushed aside similar argument, raised by Senior Counsel for the builder, while holding as under:-

“24 Before dealing with the legal issues, it is necessary to note down amended and unamended provisions of Section 8 of 1996 Act and other provisions, which were added in the 1996 Act (principal Act), by the Arbitration and Conciliation Amendment Act, 2015, which was signed by the Hon'ble President of India on 31.12.2015.

            Unamended provisions of Section 8 of 1996 Act,       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.”

25.  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.”

26. The provisions which needs interpretation/ explanation, as added in the principal Act, have been underlined, in the above extracted paragraph. Vide the 2015 Act, in principal Act, Fourth Schedule was added with it, scale of fee, to be charged by an Arbitrator has been prescribed. Besides as above, by making amendment in Section 11 of 1996 Act, it is provided that any application of the contesting parties to appoint an Arbitrator is to be decided by the High Court/its nominee expeditiously as possible and an effort be made to dispose of the same, within 60 days, from the date of service of notice upon the opposite party. Further, by making an amendment in the principal Act, Section 29 A has been added providing that an Arbitrator is supposed to make an award within 6 months from the date the Arbitral Tribunal enters upon the reference. There is a provision for extending the time period for 6 months more, with consent of the parties. Thereafter, the Court has been given power to extend it, in case of need. As per Section 34 of 1996 Act, the award so passed, can be challenged before the Court. As per amended provisions added in the principal Act, the Court is supposed to dispose of the said dispute within a period of one year, from the date, on which the notice is served upon the opposite party. As per law, the matter can further be challenged in the High Court and may be, thereafter, it will go to the Hon'ble Supreme Court of India.

27.  Now, we would like to deal with applicability of Section 8 (amended) of the principal Act, to the proceedings before this Commission. It is to be decided, as to whether, in the face of existence of an arbitration clause in the Agreement, it is open to this Commission, to entertain a consumer complaint, in terms of provisions of Section 3 of 1986 Act or not.

            Here, it is necessary to reproduce the provisions      of Section 3 of 1986 Act, for consideration:-

“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.”

28   Such issue was also raised, when unamended provisions of Section 8 of 1996 Act, was in existence. Similar argument was raised that when settlement of disputes is provided through arbitration in the Agreement, the consumer complaint is not maintainable. In umpteen number of cases, it is held by the Hon'ble Supreme Court of India, National Commission and various State Commissions, that Section 3 of 1986 Act provides additional remedy and existence of arbitration clause, in the Agreement, to settle disputes between the parties, is not a bar to entertain a complaint filed by the consumer, alleging deficiency in providing service etc.

            A similar issue came up before this Commission in Sh.Dharam Pal Gupta Vs. M/s Emaar MGF Land Limited and another, Consumer Complaint No.147 of 2015, decided on 13.10.2015. After noting the ratio of judgments of the Hon'ble Supreme Court of India, in various cases, and also of the National Commission, it was observed as under:-

It was next vehemently argued by Counsel for  opposite parties No.1 and 2 that the complaint filed under Section 17 of the Act, was not maintainable, before this Commission, on account of existence of an arbitration Clause in the Buyer’s Agreement. To say so, reference was made to Clause 42 of the Buyer’s Agreement, which reads thus:-

“42. In the event of any dispute arising out of or touching upon or in relation to the terms of this Agreement or its termination, including the interpretation and validity thereof and the respective rights and obligations of the Parties shall be settled amicably by mutual discussion, failing which the same shall be settled through arbitration of an Arbitrator to be appointed (by?) the Company. The arbitration proceedings shall be governed by the Arbitration and Conciliation Act, 1996, or any statutory amendments, modifications or re-enactment thereof for the time being in force and shall be held at New Delhi. The Courts at Mohali alone shall have the territorial jurisdictions in all matters arising out of/touching and/or concerning this Agreement”

It is stated that in case of dispute, an attempt will be made to settle the same, in an amicable manner, failing which, the same shall be referred to an Arbitrator in terms of Arbitration and Conciliation Act, 1996 (in short the 1996 Act). Heavy reliance has been placed on judgment of Calcutta High Court titled as Sudarshan Vyapar Pvt. Ltd. and another's case (supra). Further reliance was placed on a judgment rendered by the State Consumer Disputes Redressal Commission, Punjab, at Chandigarh, titled as Raj Kumar Singal Vs. M/s Puma Realtors Private Limited and another, Miscellaneous Application Nos.1226 and 1227 of 2014, in Consumer Complaint No.60 of 2014 and also upon a case titled as M/s S.B.P. and Co. Vs. M/s Patel Engineering Limited and another, AIR 2006 SC 450.

On the other hand, it is stated by Counsel for the complainant that in terms of Section 3 of the 1986 Act, above plea supported by the said judgments, needs to be rejected.

In the case of M/s S.B.P. and Co.'s case (supra), the Hon'ble Supreme Court dealt with altogether a different issue i.e. what is the nature of function of the Chief Justice or his designate, under Section 11 of the 1996 Act. Whether it is purely an administrative function or the Chief Justice or his designate, has the power to adjudicate upon the issues like existence of Arbitration clause in the Agreement/its validity. None of the provisions of 1986 Act were under consideration. The Hon'ble Supreme Court in M/s S.B.P. and Co.'s case (supra) discussed in detail, the provisions of the 1996 Act, and then gave a finding that powers of the Chief Justice of India or the High Court, under Section 11 (6) is not an administrative power but it is a judicial power. When discussing the question, as to who would fall within the definition of Judicial Authority, in terms of Section (8) of the 1996 Act, by making reference to ratio of judgment in the case Fair Air Engineers Pvt. Ltd.  &  anr. Vs. N.K. Modi, III (1996) CPJ 1 (SC) = (1996 (6) SCC 385, it was only said that judicial authority will include the Courts, and also specific Tribunals like Consumer  Fora. Whether the Consumer Fora is bound to refer the matter to the Arbitrator, was not under consideration, in the above case.

The part of ratio of judgment in case Fair Air Engineers Pvt. Ltd.  &  anr.'s case(supra) dealing with above aspect, was not discussed in M/s S.B.P. and Co.s case (supra). In the former judgment besides opining that Consumer  Fora have all the trappings of the judicial authority, further, by making reference to the provisions of Section 34 of the Arbitration Act, 1940 viz a viz Section 3 of 1986 Act, in Fair Air Engineers Pvt. Ltd.  &  anr.'s case (supra),it was observed as under:-

“It would, therefore, be clear that the Legislature intended to provide a remedy in addition to the consentient arbitration which could be enforced under the Arbitration Act or the civil action in a suit under the provisions of the CPC. Thereby, as seen, Section 34 of the Act does not confer and automatic right nor create an automatic embargo on the exercise of the power by the judicial authority under the Act. It is a matter of discretion. Considered from this perspective, we hold that though the District Forum, State Commission and National Commission are judicial authorities, for the purpose of Section 34 of the Arbitration Act, in view of the object of the Act and by operation of Section 3 thereof, we are of the considered view that it would be appropriate that these forums created under the Act are at liberty to proceed with the matters in accordance with the provisions of the Act rather than relegating the parties to an arbitration proceedings pursuant to a contract entered into between the parties. The reason is that Act intends to relieve the consumers of the cumbersome arbitration proceedings   or civil action unless the forums on their own and on their own and on the peculiar facts and circumstances of the particular case, come to the conclusion that the appropriate forum for adjudication of the disputes would be otherwise those given in the Act.”

It was specifically opined that the remedy under Section 3 of the 1986 Act, is in addition to and not in derogation to any other remedy available to an individual.

The above question was again dealt with, by the Hon'ble Supreme Court of India, in National Seeds Corporation Ltd. Vs. M. Madhusudhan Reddy  &  anr., I (2012) CPJ 1 (SC).  Taking note of the provisions of 1996 Act and Section 3 of the 1986 Act, it was observed as under:-

“29. The remedy of arbitration is not the only remedy available to a grower. Rather, it is an optional remedy. He can either seek reference to an arbitrator or file a complaint under the Consumer Act. If the grower opts for the remedy of arbitration, then it may be possible to say that he cannot, subsequently, file complaint under the Consumer Act. However, if he chooses to file a complaint in the first instance before the competent Consumer Forum, then he cannot be denied relief by invoking Section 8 of the Arbitration and Conciliation Act, 1996. Moreover, the plain language of Section 3 of the Consumer Act makes it clear that the remedy available in that Act is in addition to and not in derogation of the provisions of any other law for the time being in force. In Fair Air Engineers (P) Ltd. v. N.K. Modi (supra), the 2-Judge Bench interpreted that section and held as under:

“the provisions of the Act are to be construed widely to give effect to the object and purpose of the Act. It is seen that Section 3 envisages that the provisions of the Act are in addition to and are not in derogation of any other law in force. It is true, as rightly contended by Mr. Suri, that the words ‘in derogation of the provisions of any other law for the time being in force’ would be given proper meaning and effect and if the complaint is not stayed and the parties are not relegated to the arbitration, the Act purports to operate in derogation of the provisions of the Arbitration Act. Prima facie, the contention appears to be plausible but on construction and conspectus of the provisions of the Act we think that the contention is not well founded. Parliament is aware of the provisions of the Arbitration Act and the Contract Act, 1872 and the consequential remedy available under Section 9 of the Code of Civil Procedure, i.e., to avail of right of civil action in a competent Court of civil jurisdiction. Nonetheless, the Act provides the additional remedy.

30. In Skypak Couriers Limited v. Tata Chemicals Limited (supra), this Court observed:

“Even if there exists an arbitration clause in an agreement and a complaint is made by the consumer, in relation to a certain deficiency of service, then the existence of an arbitration clause will not be a bar to the entertainment of the complaint by the Redressal Agency, constituted under the Consumer Protection Act, since the remedy provided under the Act is in addition to the provisions of any other law for the time being in force.”

31. In Trans Mediterranean Airways v. Universal Exports (supra), it was observed:

“In our view, the protection provided under the CP Act to consumers is in addition to the remedies available under any other statute. It does not extinguish the remedies under another statute but provides an additional or alternative remedy”.

Ratio of the judgments have left nothing to chance. It was mandated that even in the case of special legislation, it is permissible for an individual to avail remedy, under the 1986 Act. The National Commission, in a case titled as DLF Limited Vs Mridul Estate (Pvt.) Ltd., Revision Petition No.412 of 2011 (alongwith other 11 connected cases), decided on 13.05.2013 after taking ratio of judgment in the case of M/s S.B.P. and Co.'s case (supra), came to a specific conclusion that remedy provided under Section 3 of the 1986 Act is in addition to and not in derogation of the provisions of any other law, for the time being in force. It was specifically stated that ratio of judgment passed in M/s S.B.P. and Co.'s case (supra), will not debar a Consumer Fora from entertaining the complaint, even in cases where an alternative remedy of Arbitration is provided. Vide that judgment many Revision-Petitions were decided.

Feeling aggrieved against the order dated 13.05.2013, passed by the National Commission, Rosedale Developers Private Limited/Opposite Party challenged above order in the Hon'ble Supreme Court. In the case of Rosedale Developers Private Limited Vs. Aghore Bhattacharya and others, (Civil Appeal No.20923 of 2013), the  Hon'ble Supreme Court of India, by making reference to the ratio of  judgment in the case M/s S.B.P. and Co.'s case (supra),  observed that the judgment has no bearing on the issue, as to whether in the face of an Arbitration Clause, Jurisdiction  can be exercised by the Consumer  Fora or not. In that judgment, the Supreme Court had not interpreted the provisions of 1996 Act in the light of the provisions contained in 1986 Act. It was further observed that the observation made in that judgment that Section 8 of the 1996 Act is mandatory, cannot lead to an inference that the Consumer  Fora is bound to make a reference to the Arbitral Tribunal. As such, the facts of Sudarshan Vyapar Pvt. Ltd. and another's and Raj Kumar Singal's cases (supra) relied upon by Counsel for  opposite parties No.1 and 2, cannot be applied to the facts of the present case.

The position has further been clarified by the National Commission, in the latest Judgment titled as Shri Satish Kumar Pandey and another Vs. M/s Unitech Limited, Consumer Complaint No.427 of 2014 (alongwith other 23 connected cases), decided on 08.06.2015. It was observed as under:-

“It was also contended by the learned counsel for the opposite party that since the agreements between the parties contains arbitration clause, arbitration and not a complaint before this Commission is the appropriate remedy. I, however, find no merit in this contention. As provided in Section 3 of the Consumer Protection Act, the provision of this Act are in addition to the other remedies available to a consumer. Therefore, the availability of arbitration as a remedy does not debar the complainant from approaching a consumer forum in a case of deficiency in the services rendered to him by the service provider or adoption of unfair trade practices by him. This issue came up for consideration of the Hon’ble Supreme Court in National Seeds Corporation Vs. M. Madhusudhan Reddy  &  anr. (2012) 2 SCC 506  and after taking into consideration the provisions of the Section 8 of the Arbitration Act of 1996 and the Section 3 of the C.P. Act it was held that the plain language of Section 3 of the C.P. Act makes it clear that the remedy available in that Act is in addition to and not in derogation of the provisions of any other law for the time being in force.  The Hon’ble Supreme Court has also held that the complaint filed by a consumer before the consumer fora would be maintainable despite their being an arbitration clause in the agreement to refer the dispute to the Arbitrator. In view of the above referred authoritative pronouncement of the Hon’ble Supreme Court which was later followed by a Three Members Bench of this Commission in DLF Ltd. Vs. Mridul Estate Pvt. Ltd., R.P. No.412 of 2011 decided on 13-05-2013, the aforesaid contention advanced by the learned counsel for the opposite party is liable to be rejected.”

Reading of ratio of the judgments referred to above, make it clear that in case of  M/s S.B.P. and Co.'s case (supra), the issue before the Supreme Court of India was altogether different. The provisions of 1986 Act were not under consideration viz. a viz. the provisions of 1996 Act.  As such, the ratio of judgments referred to above, makes it very clear that the judgments in Sudarshan Vyapar Pvt. Ltd. and another's and Raj Kumar Singal's cases (supra), were given by wrongly interpreting the ratio of M/s S.B.P. and Co.'s case (supra).

In view of the above, it is held that the submission of Counsel for  opposite parties No.1 and 2, that  the complaint filed under Section 17 of the Act, was not maintainable, before this Commission, on account of existence of an arbitration Clause in the Buyer’s Agreement, being devoid of merit, stands rejected.

29.     Not only this, in the latest judgment titled as Mahindra Holidays & Resorts India Ltd. Vs. Adnan Samoon Rassiawala & 6 Ors., First Appeal No. 127 of 2016, decided on 18.03.2016, the National Commission observed as under:-

“The short question for consideration in this Appeal is as to whether the Maharashtra State Consumer Disputes Redressal Commission at Mumbai (for short “the State Commission”) was justified in dismissing the application filed by the Appellant, the Opposite Party in the Complaint, under Section-8 of the Arbitration and Conciliation Act, 1996, seeking stay of the proceedings in the Complaint and for referring the matter to arbitration, in view of the fact that there was an Arbitration Agreement between the parties.

Though Mr. Pattjoshi, learned Senior Counsel, has made valiant attempt to convince us that in the light of the decision of the Hon’ble Delhi High Court in HDFC Bank Ltd. v. Satpal Singh Bakshi, 2013 (134) DRJ 566 (FB), the parties were bound by the Arbitration Agreement and in view of the clear provision of Section-8 of the said Act, the dispute, subject matter of the Complaint, ought to have been referred to arbitration, yet we are unable to persuade ourselves to agree with the learned Senior Counsel.  The issue sought to be raised is no more res integra as stands concluded by a number of authoritative pronouncements by the Hon’ble Supreme Court (see Secretary, Thirumurugan Cooperative Agricultural Credit Society v. M. Lalitha (dead) through LRs & Ors., (2004) 1 SCC 305; Skypak Couriers Ltd. v. Tata Chemicals Ltd., (2000) 5 SCC 294; and National Seeds Corporation Ltd. v. Madusudan Reddy, (2012) 2 SCC 506).

In light of the said decisions of the Hon’ble Supreme Court, directly on the point, decision of the High Court cannot be relied upon, particularly when none of the afore-noted decisions have been noticed in the High Court’s decision, on which reliance has been placed by the learned Senior Counsel.

We do not find any illegality in the impugned order, warranting our interference.

Consequently, the Appeal fails and is dismissed in limine”.

30. Now it is to be seen, whether, after making amendment in Section 8 of the principal Act, any additional rights have accrued to the service provider(s), to say that on account of existence of arbitration agreement, for settling disputes through an Arbitrator, this Commission is not empowered 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.

31.  Now, we will have to see what difference has been made by effecting 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 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 for arbitrator, 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. Otherwise also, as has been stated in the earlier part of this order, where there is any ambiguity in understanding meaning of provision of law, or where two interpretations are possible, one beneficial to the consumer would be accepted.

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 cases, the consumers/ complainants have spent their entire life savings to get a plot, so that they can construct a house thereon. Their 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,  the complaint is supposed to be decided within three months, from the date of service of 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,  the consumer will be forced to (as in the present case) pay huge expenses. As in the present case, the complainant is claiming refund of Rs.65,56,513/- alongwith interest, compensation and litigation costs, aggregate value whereof, if added may be near about Rs.1 crore. In that event, the complainant will be forced to pay an amount of Rs.1,68,750/-  towards her share of Arbitrator fees. Not only as above, it is admissible to an Arbitrator, to decide the 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 General Assembly Resolution No.39/248 and the provisions of 1986 Act. In view of above, the ground raised by Counsel for opposite party no.1, stands rejected.”

 

Similar view was reiterated by this Commission, in Praveen Kumar Arora and another Vs. Emaar MGF Land Limited, consumer complaint No.198 of 2015, decided on 04.04.2016, by further holding as under:-

“20. 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. In the present case, the complainants have spent their entire life earnings to purchase a unit, in a housing project, launched by the opposite party. It was their hope that they will live therein. However, their hopes were shattered, when despite making payment of entire amount towards price, they failed to get possession of a unit, in a developed project. As per established ratio of the judgment in Secretary, Thirumurugan Cooperative Agricultural Credit Society v. M. Lalitha (2004) 1 SCC 305 and also in the judgment of 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), it was said that the consumers are always in a weak position, and in cases where two interpretations are possible, the one beneficial to the consumer 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.

21. In view of the above, the argument raised by Counsel for 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”.

           

21.       Not only as above, execution of judgment/decree passed by the Consumer Foras is very easy and less time consuming. Invariably, in all the judgments passed, between one to three months’ time, is granted to the judgment debtors(s) to discharge liability. If it is not so done, and the order is not stayed in the meantime by the Higher Fora, two options are available with the complainant/decree holder. Section 25 of 1986 Act provides the procedure to enforce orders by the Consumer Foras. In Sector 25 (3), it is provided that where any amount is due from any person, under an order passed by any Consumer Fora, the concerned Consumer Fora, on an application moved by the decree holder, may issue a certificate to the Collector of the District, to recover the said amount, by way of land revenue, in  terms of Section 72 of the Punjab Land Revenue Act, 1887. The said provision is also very stringent. The Collector is supposed to attach the holding of the judgment debtors to take the said property under his own management and control. The Collector is further supposed to manage the said property and raise all rents and profits accruing therefrom to the exclusion of the defaulter, until the decree is satisfied. The above procedure will consume at the maximum four to six months, for realization of the amount awarded. Further option is also available to a complainant/decree holder, to move an application under Section 27 of 1986 Act, which provides that where a trader or a person against whom, a complaint was made, fails or omits to comply with the order passed by the Consumer Fora, such party would entail award of punishment of imprisonment for a term, which shall not be less than one month, but may extend to three years, or with fine, which shall not be less than Rs.2,000/-, and may be extended upto Rs.10,000/-, or both. This provision serves as a deterrent. As and when application is moved under Section 27 of 1986 Act, for fear of imprisonment, it is seen that immediately the judgment debtor(s) make an attempt to comply with the order passed by the Consumer Foras. Whereas, to the contrary Section 36 of 1996 Act, provides that award shall be enforced, in accordance with the provisions of the Code of Civil Procedure 1908, in the same manner, as if it was a decree of a Court. Such a procedure is very costly and time consuming. Executing a decree would virtually mean fighting one more litigation, in a Court, to get enforcement of the award. If such a procedure is adopted, it will defeat the very purpose and spirit of 1986 Act.

            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.

22.       Whether the complainant is entitled to compensation, for mental agony and physical harassment caused to her, at the hands of the opposite parties, as also escalation in prices, or not.

            The complainant had expectations to settle in the unit, after lapse of 24 months, from the date of execution of the Buyer’s Agreement i.e. from 27.06.2011. However, her hopes were not fulfilled when possession of the unit, in question, was not even offered to her, by the stipulated date. Compelled under the circumstances, she  even agreed to extend the period, to get possession, by 12 months, against letter dated 08.07.2013. As per information supplied by Counsel for the opposite parties, even today construction of the unit is not complete and firm date to hand over possession is not in sight. The Opposite Parties have failed to perform their part of the Agreement. The act in not handing over possession in time, as per the Agreement, and also extended period against letter dated 08.07.2013, is a material deficiency, in providing service on the part of the opposite parties. Thus, the complainant is certainly entitled to be compensated for mental agony and physical harassment suffered by her, as also escalation in prices.

23.       Whether the complainant is entitled to interest on the amount deposited alongwith interest, if so, at what rate.

            There is no dispute that for making delayed payments, as per Clause 39 (a) of the Buyer’s Agreement, the opposite parties were charging interest @15% P.A., for a delay of first 90 days, and, thereafter, penal interest @18% P.A. In view of above facts, the complainant is certainly entitled to get refund of the amount deposited by her, to the tune of Rs.77,80,217/- alongwith interest @15% P.A., from the respective dates of deposits, till realization. However, since in the instant case (CC No.295 of 2015), the complainant has claimed interest only @10% p.a. on the amount deposited, as such, this Commission, is restricted  to grant interest to that extent only, in this particular case. In other cases, interest will be payable @15% p.a.

24.       No other point, was urged, by Counsel for the parties.     
25.       For the reasons recorded above, this complaint is partly accepted, with costs. The opposite parties/builder are jointly and severally directed as under:-
    1.   To refund an amount Rs.77,80,217/-, to the complainant, alongwith interest @ 10% P.A., (as prayed), from the respective dates of deposits onwards.
    2.   To pay compensation, in the sum of Rs.2.50 lacs (as prayed), for causing mental agony and physical harassment, to the complainant, as also escalation in prices of the real estate.
    3.   To pay cost of litigation, to the tune of Rs.33,000/- (as prayed), to the complainant.
    4.   The payment of awarded amounts mentioned at sr.nos.(i) to (iii), shall be made by the opposite parties/builder, within a period of 45 days, from the date of receipt of a certified copy of this order, failing which, they shall be liable to pay the amount mentioned at sr.no.(i), alongwith penal interest @15% p.a. instead of interest @10% p.a. from the respective dates of deposits onwards, and interest @15% p.a, on the amounts mentioned at sr.nos.(ii) and (iii), from the date of filing of this complaint, till realization.

 

Consumer complaint bearing No.317 of 2015 titled as Madhu Chaudhary Vs. DLF Homes Panchkula Private Limited:-

1.      To refund an amount Rs.57,06,912.86Ps., to the complainant, alongwith interest @ 15% P.A., from the respective dates of deposits onwards. (Above rate of interest is less than the rate of interest charged by the Opposite Party for delayed payment i.e. 18% P.A.)
2.      To pay compensation, in the sum of Rs.3 lacs, for causing mental agony and physical harassment, to the complainant, as also escalation in prices of the real estate.
3.      To pay cost of litigation, to the tune of Rs.50,000/-, to the complainant.

 

Consumer complaint bearing No.18 of 2016 titled as Sanjay Vashisth Vs. DLF Homes Panchkula Private Limited:-

1. To refund an amount Rs.87,63,867/-, to the complainant, alongwith interest @ 15% P.A., from the respective dates of deposits onwards. (Above rate of interest is less than the rate of interest charged by the Opposite Party for delayed payment i.e. 18% P.A.)
2. To pay compensation, in the sum of Rs.3 lacs, for causing mental agony and physical harassment, to the complainant, as also escalation in prices of the real estate.
3. To pay cost of litigation, to the tune of Rs.50,000/-, to the complainant.

 

Consumer complaint bearing No. 48 of 2016 titled Arun Yadav Vs. DLF Homes Panchkula Private Limited:-

1. To refund an amount Rs.75,41,249.29Ps., to the complainant, alongwith interest @ 15% P.A., from the respective dates of deposits onwards. (Above rate of interest is less than the rate of interest charged by the Opposite Party for delayed payment i.e. 18% P.A.)
2. To pay compensation, in the sum of Rs.3 lacs, for causing mental agony and physical harassment, to the complainant, as also escalation in prices of the real estate.
3. To pay cost of litigation, to the tune of Rs.50,000/-, to the complainant.

 

26.       The payment of awarded amounts (in Consumer complaint bearing Nos.317 of 2015, 18 of 2016  and  48 of 2016) mentioned at sr.nos.(i) to (iii), shall be made by the opposite party(s)/builder, within a period of 45 days, from the date of receipt of a certified copy of this order, failing which, they shall be liable to pay the amount mentioned at sr.no.(i), alongwith penal interest @18% p.a., instead of @15% p.a., from the respective dates of deposits onwards, and interest @15% p.a., on the amounts mentioned at sr.nos.(ii) and (iii), from the date of filing of this complaint, till realization.
27.       However, it is made clear that in the cases, where the complainant(s) has/have availed loan facility from any financial institution(s), it shall have the first charge of the amount payable, to the extent, the same is due to be paid by him/her (complainant(s).
28.       Certified copies of this order be sent to the parties, free of charge.
29.       The file be consigned to Record Room, after completion.

Pronounced.

18.04.2016

Sd/-

[JUSTICE JASBIR SINGH (RETD.)]

PRESIDENT

 

Sd/-

[DEV RAJ]

MEMBER

 

Sd/-

[PADMA PANDEY]

 MEMBER

Rg.