Chandigarh

StateCommission

CC/21/2020

Shiv Lal Chabra - Complainant(s)

Versus

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

Narender Yadav & Vineet Yadav Adv.

11 Jan 2021

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

Complaint case No.	:	21 of 2020
Date of Institution	:	15.01.2020
Date of Decision	:	11.01.2021

 

Shiv Lal Chabra S/o Sh.Aasa Nand R/o H.No.80, Ram Nagar, Karnal, Haryana.

…… Complainant

V e r s u s

 

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

 

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

 

2. Rajeev Singh, Additional Director, DLF Gateway Tower, Second Floor, DLF City, Phase-III, Gurgaon-122002, Haryana, India.

 

3. Vishal Gupta, Director, DLF Gateway Tower, Second Floor, DLF City, Phase-III, Gurgaon-122002, Haryana, India.

Email ID:crmchandigarh@dlf.com

.....Opposite parties

 

BEFORE:              JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT.

                             MRS.PADMA PANDEY, MEMBER

 

Present through Video Conferencing:-

                             Sh.Narender Yadav, Advocate for the complainant.

                             Sh.Shiv Kumar, Advisor (Legal) of the opposite parties.

                        

JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT

         

                   This complaint has been filed by the complainant seeking refund of the amount paid by him towards purchase of unit bearing no.E-1/1, :First Floor,  measuring 1550 sq. feet, in the project of the opposite parties launched by them under the name and style- “The Valley”, Sector 3, Kalka Pinjore Urban Complex,  Haryana or in the alternative to issue directions to them to deliver actual physical possession thereof, alongwith compensation, litigation  cost etc. It has been stated that  booking of the said unit was done on 28.09.2010 and thereafter, agreement in respect thereof was executed between the parties on 01.08.2011. Total cost of the said unit was fixed at Rs.58,620,99.78ps. As per clause 11 (a) of the agreement, possession of the unit was to be delivered within a period of 24 months from the date of execution thereof i.e. latest by 31.07.2013, yet the opposite parties miserably failed to do so. It has been averred that thereafter vide letter dated 05.10.2016, Annexure C-3, the opposite parties offered possession of the unit in question and also made demand  of Rs.30,75,930/-which was later on reduced to Rs.28,93,000/- after giving 2% discount. However, despite the fact that the complainant  made payment of Rs.28,93,000/- as demanded by the opposite parties and also total amount of Rs.78,05,705/- stood received by them for the period from 28.09.2010 till 30.06.2017, yet, there were number of defects/snags in the said unit, as a result whereof requests were made by the complainant to remove the same, so that he is able to take possession, yet, neither defects/snags were removed nor possession of the unit was handed over, thereafter. Under those circumstances, the complainant waited for some time and then wrote letter dated 15.12.2017, Annexure C-5 and 20.03.2018, Annexure C-6 in the matter but to no avail. However, to his utter shock, instead of doing the needful, the opposite parties raised further demand of Rs.9,00,864/- for handing over possession of the said unit. 

                    By stating that the aforesaid act and conduct of the opposite parties amount to deficiency in providing service and adoption of unfair trade practice, this complaint has been filed by the complainant. In the written arguments filed by the complainant, he has shown his intentions for refund of the amount paid only instead of pressing his alternative relief for possession.

2.           The claim of the complainant has been contested by the opposite parties on numerous grounds, inter alia, that the complainant has concealed material facts from this Commission; that in the face of existence of arbitration clause in the agreement this consumer complaint is not maintainable; that this complaint is also not maintainable before this Commission as the complainant is seeking modification/re-writing of terms and conditions of the agreement and as such it can be adjudicated by civil court only; that this Commission did not vest with territorial jurisdiction; that he did not fall within the definition of ‘consumer’, as he is a speculator; that the complaint filed is beyond limitation as possession of the unit in question had been delivered as far as back vide letter dated 05.10.2016; that this complaint is infructuous in view of offer of possession made to the complainant vide the letter aforesaid; that he is a defaulter as he failed to pay remaining amount of Rs.13,15,465/- thereby guilty of violation of terms and conditions of the agreement and as such is not entitled to any relief and on the other hand is liable to pay holding charges; that all the demands were made as per terms and conditions of the agreement; that the case of complainant amounts to cancellation of the agreement and is thus required to be dealt with as per clause 14 of the agreement
3.           On merits, booking of the unit in question by the complainant; payments made by him as mentioned in the complaint; execution of  agreement; non delivery of possession of the unit by the promised date have not been disputed.
4.           However, it has been stated  that though as per clause 11 (a) of the agreement, possession of the unit was to be delivered within a period of 24 months from the date of execution thereof, yet, delay took place on account of force majeure circumstances, beyond the control of the opposite parties; that possession of the unit in question was offered to the complainant vide letter dated 05.10.2016 on receipt of occupation certificate but he failed to take over the same on making payment of remaining amount; that delay in offering possession of the unit took place because there was stay on construction activities by the Hon’ble Supreme Court, for the period from 19.04.2012 to 12.12.2012; that after vacation of stay on construction, it took several months to arrange/recall the labourers/masons to restart work at the project site; that the competent authorities also delayed in issuance of statutory approvals because service plan submitted by the company on 05.06.2013 was received on 14.08.2014 and revision of layout plan was received only on 06.09.2013 despite the fact that the same was submitted by the company on 11.03.2013; that all the above factors constituted force majeure circumstances which were beyond the control of the company; that number of allottees have taken over possession of their respective units and have executed sale deeds also; and that still the complainant will get the cost escalation free unit and can take over possession thereof on making payment of remaining amount. Prayer has been made to dismiss this complaint with heavy costs.
5.           The parties led evidence in support of their case.
6.           We have heard the contesting parties and have gone through the evidence and record of the case, including the written arguments filed by the parties, very carefully.
7.           First, we will deal with the objection raised by the opposite parties that the complainant did not fall within the definition of ‘consumer’. It may be stated here that the objection raised is not supported by any documentary evidence and as such the onus shifts to the opposite parties to establish that the complainant has purchased the unit in question to indulge in ‘purchase and sale of units/flats’ as was held by the Hon’ble National  Commission in Kavit Ahuja vs. Shipra Estates I (2016) CPJ 31 but since they failed to discharge their onus, hence we hold that the complainant is a consumer. Objection taken in this regard, as such, stands rejected. 
8.           Now we will deal with the objection regarding territorial jurisdiction of this Commission, it may be stated here that it is settled law that even an infinitesimal fraction of a cause of action will be part of the cause of action and confer jurisdiction on the Court/Tribunal/Fora within the territorial limits of which that occurs. In this case, it is clearly evident that the agreement dated 01.08.2011 in respect of the unit in question has been executed between the parties at Chandigarh. Not only as above, even the letters dated 15.12.2017, Annexure C-5 and 20.03.2018, Annexure C-6 have been received by the Company at their office at SCO No.190-192, Sector 8-C, Chandigarh. It is further evident that on all the payment receipts, demand letters and other letters relating to the unit in question, the address of the company is found mentioned as SCO No.190-192, Sector 8-C, Chandigarh  and Chandigarh Technology Park, Plot No.2, Tower No.D, Ground Floor, Chandigarh, meaning thereby that the company was actually and voluntarily residing and carrying on its business and personally work for gain thereat. As such, objection taken with regard to territorial jurisdiction stands rejected. 
9.           There is no dispute with regard to the fact that on 28.09.2010 the complainant had booked the unit in question and has paid an amount of Rs.78,05,705/- to the opposite parties, possession  whereof was required to be delivered within a period of 24 months from the date of execution thereof i.e. latest by 31.07.2013 as per clause 11 (a) of the agreement dated  01.08.2011. It is also not in dispute that the opposite parties miserably failed to  offer possession of the said unit by the promised date and it was offered after a long delay vide letter dated 05.10.2016, Annexure C-3.

                   Under above circumstances, the moot question which falls for consideration is, as to whether, the complainant was obliged to take over possession so offered vide letter dated 05.10.2016 i.e. after delay of more than three years of the committed date or not. Before deciding this question, it is very significant to mention here that it is evident from the Final Customer Observations Sheet (at page 71 of the file) that the complainant has reported to the opposite parties that there were number of defects/snags in the said unit i.e. sliding door was not working; tiles in the drawing room were not of the same colour; there was seepage in drawing room wall; main door was required to be repaired; and taps of washroom were not working and were blocked. These defects were of such a nature that the complainant could not have reside therein and as such, he vide letters dated 15.12.2017, Annexure C-5 and 20.03.2018, Annexure C-6, requested the opposite parties to intimate him for actual delivery of possession of  the unit in question. However, there is nothing on record that the said letters were even responded by the opposite parties, what to speak of removal of the said defects/snags and in this manner, the complainant, who is a senior citizen, was left in lurch.

                    Irrespective of the fact that the unit in question was complete in all respects or that there were defects/snags therein or not, when possession was offered in October 2016, vide letter Annexure C-3, the fact remains that there was an inordinate delay of more than 3 (three) years in offering the same. Thus, we are of the considered opinion that the complainant was not obliged to take over the said possession, even if it is assumed for the sake of arguments that the same was genuine/complete in all respects (though in the present case, not complete, as there were defects/snags therein of such a nature that the unit was not livable). Our this view is supported by the principle of law laid down by the Hon’ble Supreme Court of India in Civil Appeal No.12238 of 2018 (Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan), decided on 02.04.2019, wherein it was held as under:-

“9. We see no illegality in the Impugned Order dated 23.10.2018 passed by the National Commission. The Appellant – Builder failed to fulfill his contractual obligation of obtaining the Occupancy Certificate and offering possession of the flat to the Respondent – Purchaser within the time stipulated in the Agreement, or within a reasonable time thereafter. The Respondent – Flat Purchaser could not be compelled to take possession of the flat, even though it was offered almost 2 years after the grace period under the Agreement expired…….”

Similar view had been taken by the Hon’ble National Commission in M/s. Emaar MGF Land Ltd. & Anr. Vs. Dr.Manuj Chhabra, First Appeal No.1028 of 2015, decided on 19.04.2016, as under:-

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

 

Furthermore, in another case titled as Aashish Oberai Vs. Emaar MGF Land Limited, Consumer Case No. 70 of 2015, decided on 14 Sep 2016, similar view was reiterated by the Hon’ble National Commission, as under:-

“I am in agreement with the learned senior counsel for the complainants that considering the default on the part of opposite parties no.1 and 2 in performing its contractual obligation, the complainants cannot be compelled to accept the offer of possession at this belated stage and therefore, is entitled to refund the entire amount paid by him along with reasonable compensation, in the form of interest.”

 

10.           Under these circumstances, if the complainant did not pay the remaining amount, he cannot be termed as defaulter, especially when he saw that the offer so made in respect of the unit in question, after a huge delay was not habitable because of nature of the defects/snags referred to above. Because in the present case also, there is a delay of more than  3 years in offering possession of the unit in question, as such, in view of settled law that non-delivery of possession of plots/units in a developed project by the promised date (irrespective of the fact that occupation certificate has been obtained from the competent authorities) is a material violation on the part of a builder and in those circumstances, the allottee is well within his/her right to seek refund of the amount paid, if we order refund of the amount paid alongwith suitable interest that will meet the ends of justice. The complainant is therefore held entitled to get refund of the amount paid alongwith interest, from the respective dates of deposits till realization.
11.           However, to wriggle out of the situation, the opposite parties through their  Advisor (Legal) have taken a plea that delay in possession took place on account of the force majeure circumstances having been faced by them which were beyond their control i.e. there was stay on construction activities by the Hon’ble Supreme Court, for the period from 19.04.2012 to 12.12.2012 and after vacation thereof, it took several months to arrange/recall the labourers/masons to restart work at the project site; and also that there was delay on the part of the competent authorities to grant statutory approvals. We do not agree with the plea taken for the reasons to be recorded hereinafter.

                   First coming to the stay aforesaid, it is true that in some litigation, the Hon’ble Supreme Court of India stayed construction activities and order passed remained in force from 19.04.2012 up-to 12.12.2012 i.e. for about 8 months. In the present case, agreement was executed between the parties on 01.08.2011 and  as per clause 11 (a) thereof possession of the unit in question was to be delivered within a period of 24 months i.e. latest by 31.07.2013. Under above circumstances, if we add 8 months more on account of suspension of construction activities for the said period, in view of stay aforesaid, and also over and above that 8 months, we give more 4 months of grace period which might have consumed for arranging/recalling the labourers/mason for work i.e. total 12 months over and above 24 months aforesaid, to the opposite  parties then also possession of the unit in question should have been offered to the complainant latest by 31.07.2014 but it has not been done so and the same was offered only on 05.10.2016 and that too was incomplete. No justification, whatsoever, for delay in offering possession beyond 31.07.2014, has been given by the opposite parties.

                   The plea taken by the opposite parties to the effect that delay in handing over possession of the unit took place also due to delay in granting statutory approvals by the competent authorities, the same being absolutely beyond their control, is not tenable. As stated above, the unit in question was sold in the year 2011 and agreement was executed on 01.08.2011. The opposite parties should have obtained all the approvals/sanctions before booking the said unit. To the contrary, admittedly, the service plan was submitted by the company on 05.06.2013, which was received on 14.08.2014 and also approval with regard to revision of layout plan was received on 06.09.2013, meaning thereby that the project was sold in 2011 without obtaining necessary approvals and finalization of service and layout plans, which act amounts to unfair trade practice on the part of the opposite parties. If the opposite parties chose to accept booking without obtaining statutory approvals, they are to blame to themselves only.  The purchaser of the units, who had nothing to do with the revision of layout or service plans, cannot be penalized, by postponing the possession. Our this view is supported by the observations made by the Hon’ble National Commission in M/s. Narne Constructions Pvt. Ltd. Vs. Dr. Devendra Sharma & 4 Ors., Revision Petition No. 4620 of 2013, decided on 17 Dec 2015. Relevant part of the said order reads as under:-

 

“…..As far as final sanction of layout by HUDA is concerned, in my view, the petitioner cannot penalize the complainants/respondents for the delay in the aforesaid sanction since delay cannot be attributed to any act or omission on the part of the complainants/respondents.  In fact, in my opinion, the petitioner should not even have accepted the booking without final sanction of the layout by HUDA.  If the petitioner chose to accept booking on the basis of provisional sanction of the layout by HUDA, it is to blame to only itself for the delay, if any, on the part of the HUDA in issuing the final sanction of the layout.  The purchaser of the plot, who had nothing to do with the sanction of the layout by HUDA cannot be penalized, by postponing the possession or registration of the plot and therefore any escalation in the registration charges on account of delay in final sanction of layout by HUDA must necessarily be borne by the builder and not by the allottee of the plot…..”

 

12.           It has thus been proved that money has been collected from the prospective buyers including the complainant starting from 2011 itself without obtaining statutory approvals. Collecting money from the perspective buyers and selling the project, without obtaining the required permissions/approvals is an unfair trade practice on the part of the project proponent. It was so said by the Hon’ble National Commission, in a case titled as M/s Ittina Properties Pvt. Ltd. & 3 Ors. Vs. Vidya Raghupathi & Anr., First Appeal No. 1787 of 2016, decided on 31 May 2018. Relevant part of the said order reads as under:-

“…………….This Commission in Brig. (Retd.) Kamal Sood Vs. M/s. DLF Universal Ltd., (2007) SCC Online NCDRC 28, has observed that it is unfair trade practice on the part of the Builder to collect money from the perspective buyers without obtaining the required permission and that it is duty of the Builder to first obtain the requisite permissions and sanctions and only thereafter collect the consideration money from the purchasers.

It is an admitted fact that the sale deeds were executed in the year 2006 and by 2009 the completion certificate was not issued. The Occupancy Certificate was issued only on 25.09.2017 during the pendency of these Appeals before this Commission. Allotting Plots or Apartments before procuring the relevant sanctions and approvals is per se deficiency…………”

 

13.           At the time of arguments also, Sh.Shiv Kumar, (Advisor) Legal of the opposite parties failed to apprise this Commission, as to why the opposite parties were in  a hurry to sell the project in the absence of statutory approvals aforesaid and also why  the company failed to deliver possession of the unit  even by 31.07.2014 i.e. within a period of 12 months over and above the committed date (31.07.2013). Under these circumstances, plea taken by the opposite parties justifying the delay aforesaid in offering possession of the unit till 05.10.2016 is accordingly rejected.
14.           From the peculiar circumstances of this case, it has been proved that the builder-Company made false representations, which were materially incorrect and were made in such a way that the complainant, to whom it was made, were entitled to rely upon it and he may act in reliance on it. The complainant is thereby involved in a disadvantageous contract with the opposite parties and suffered financial loss, mental agony and physical harassment. Representations/statements made at that time were believed to be true. All the facts established that from the very inception there was intent to induce the complainant to enter into the contract by way of signing agreement, referred to above, and also intent to deceive him, which act amounts to grave deficiency in providing service, negligence and adoption of unfair trade practice on the part of the opposite parties.
15.           As far as objection taken by the opposite parties to the effect that in the face of existence of Arbitration clause in the agreement, jurisdiction of this Commission is barred it may be stated here that this issue has already been dealt with by the larger Bench of the Hon’ble National Commission in a case titled as Aftab Singh  Vs. Emaar MGF Land Limited & Anr., Consumer Case No. 701 of 2015, wherein, vide order dated 13.07.2017, it has been held that an Arbitration Clause in the Agreements between the buyer and the Builder cannot circumscribe the jurisdiction of a Consumer Fora notwithstanding the amendments made to Section 8 of the Arbitration Act. Feeling aggrieved against the said findings, the builder filed Civil Appeal bearing No.23512-23513 of 2017 before the Hon’ble Supreme Court of India, which was dismissed vide order dated 13.02.2018. Even the Review Petition (C) Nos. 2629-2630 of 2018 filed by the builder in Civil Appeal Nos.23512-23513 of 2017 against order dated 13.02.2018, was dismissed by the Hon’ble Supreme Court of India, vide order dated 10.12.2018.
16.           As far as objection taken to the effect that this consumer complaint is not maintainable because the complainant is seeking rewriting/modification of the contract and that only the civil court has the  power to adjudicate the matter is concerned, it may be stated here that it is a simple case of adoption of unfair trade practice, negligence and deficiency in providing service on the part of the opposite parties, as they have failed to deliver possession of the unit in question to the complainant by the committed date or within the extended period of 12 months, in view of stay on construction activities for 8 months plus 4 months, referred to above; the project had been launched and units were sold therein, without obtaining statutory approvals; and also incomplete possession was offered vide letter dated 05.10.2016 and the grievance of the complainant who is a senior citizen was not redressed despite requests having been made by him time and again. In Lucknow Development Authority Vs. M.K.Gupta, Civil Appeal No.6237 of 1990, decided on 5.11.1993,  the Hon’ble Supreme Court held that where the developer is at fault in not delivering possession of an immovable property, the act so amounts to denial of service and consumer complaint is maintainable before the Consumer Fora. As such, objection raised by the opposite parties in this regard stands rejected.
17.           Since, it is an admitted fact that actual physical possession of unit in question, complete in all respects, has not been delivered  to the complainant till the date of filing of this complaint as the opposite parties failed to rectify the defects/snags aforementioned despite making written requests by him vide the letters, referred to above, which went unanswered and in the absence thereof, it was not feasible for the complainant, who is a senior citizen to reside therein nor the amount paid by him has been refunded till date, as such, there is a continuing cause of action in his favour to file this complaint in view of law laid down in Lata Construction & Ors. Vs. Dr. Rameshchandra Ramniklal   Shah and Anr., II 2000 (1) CPC 269=AIR 1999 SC 380 and Meerut Development Authority Vs. Mukesh Kumar Gupta, IV (2012) CPJ 12 (SC),  wherein it was held that when actual physical possession of the residential units is not offered, there is a continuing cause of action in favour of the allottee/buyer. Objection raised in this regard, as such, stands rejected.
18.           Now, we will deal with the question, as to what rate of interest should be awarded to the complainant, while ordering refund of amount paid.  It may be stated here that compensation cannot be uniform and can best be illustrated by considering cases where possession is being directed to be delivered and cases where only monies are directed to be returned. The party concerned in refund cases is suffering a loss inasmuch as he had deposited the money in the hope of getting a flat/plot but he is deprived of same; he is deprived of the benefit of escalation of the price of that flat/plot; and also he would have to take out more money from his pocket for beating the escalation in price, for buying a new flat/plot and as such, compensation to be granted by way of interest on the deposited amount in such cases would necessarily have to be higher. Our this view is supported by the principle of law laid down by the Hon’ble Supreme Court in  Ghaziabad Development Authority Vs. Balbir Singh (2004) 5 SCC 65 wherein it was held that in a case where money is being simply returned, the purchaser is suffering a loss in as much as he had deposited the money in the hope of getting a flat/plot and therefore, he has been deprived of the benefit of escalation of the price. The compensation in such cases, therefore, would necessarily have to be higher.

                   Furthermore, a similar question, as to what rate of interest should be granted while ordering refund of the deposited amount, in case, the builder fails to deliver actual physical possession of residential units/plots, by the stipulated date, fell for determination before the Hon`ble Supreme Court of India in H.U.D.A. Vs. Neelam Sharma, Civil Appeal no.3417 of 2003 decided on 18.08.2004. In the said case, the Hon`ble Supreme Court held that in case of refund of amount, the Interest Act would apply and 12% interest is to be granted from the date of amounts deposited till repayment. The Hon’ble National Commission also, in Alok Kumar Vs. M/s. Golden Peacock Residency Private Limited & Anr., Consumer Case No. 1315 of 2018, decided on 06 Sep 2019  and Anil Kumar Jain & Anr  Vs. M/s. Nexgen Infracon Private Limited (A Mahagun Group Company), Consumer Case No. 1605 of 2018, decided on 23^rd Dec 2019, awarded interest @12% p.a. to the complainants, on the amounts to be refunded to them from the respective dates of deposits. In the present case also, if we grant interest @12% p.a. on the amount to be refunded to the complainant, that will meet the ends of justice.

19.           For the reasons recorded above, this complaint is partly accepted, with costs and the opposite parties, jointly and severally are directed as under:-

1. To refund the amount of Rs.78,05,705/- to the complainant, alongwith interest @12% p.a. from the respective dates of deposit onwards, without deducting any TDS, within a period of 30 days, from the date of receipt of a certified copy of this order, failing which, thereafter, the said amount of Rs.78,05,705/- shall carry 3% penal interest i.e. 15% p.a. (12% p.a. plus (+) 3% p.a.), from the date of passing of this order, till realization.
2. To pay compensation for causing mental agony and harassment and also cost of litigation, in lumpsum, to the tune of Rs.50,000/-, to the complainant, within a period of 30 days, from the date of receipt of a certified copy of this order, failing which, the said amount of Rs.50,000/-, shall carry interest @9% p.a. from the date of passing of this order, till realization.
3. However, it is made clear in this case that if the complainant has availed loan facility from any Bank/Financial Institution, for making payment towards price of the unit in question, it will have the first charge of the amount payable, to the extent, the same is due to be paid by the complainant.

20.           Certified Copies of this order be sent to the parties, free of charge.
21.           The file be consigned to Record Room, after completion.

Pronounced.

11.01.2021

 

Sd/-

[JUSTICE RAJ SHEKHAR ATTRI]

PRESIDENT

 

 

Sd/-

[PADMA PANDEY]

MEMBER

         

 

Rg