Chandigarh

StateCommission

CC/157/2018

Ramesh Kumar Malik - Complainant(s)

Versus

DLF Universal Limited - Opp.Party(s)

Narender Yadav, Vineet Yadav, Adv.

12 Jul 2018

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Complaint No.	:	157 of 2018
Date of Institution	:	12.04.2018
Date of Decision	:	12.07.2018

 

1. Ramesh Kumar Malik
2. Veena Malik

Both R/o H.No.1694, Sector 9, Faridabad, Haryana.

…Complainants

V e r s u s

1. DLF Universal Limited (earlier known as DLF India Limited) having its Registered Office at  Shopping Mall, 3^rd Floor, Arjun Marg, DLF City, Phase-I, Gurgaon - 122002, Haryana, through its Chairman/Managing Director/Director/ Authorized Signatory

        Regional Office Address:-

        DLF Universal Limited (earlier known as DLF India Limited) SCO No.190-191-192, Sector 8-C, Chandigarh, 160009, through its Chairman/Managing Director/Director/Authorized Signatory.        

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

…..Opposite Parties

 

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

 

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

                        SH.DEV RAJ, MEMBER

                        MRS. PADMA PANDEY, MEMBER

 

Argued by:-       Sh.Narender Yadav, Advocate for the complainants.

Sh.Parveen Jain, Advocate for the opposite parties.

 

 

PER JUSTICE JASBIR SINGH (RETD.), PRESIDENT

                The facts, in brief, are that the complainants purchased an independent floor bearing no.R2-E807, First Floor, from opposite party no.1, in its Group Housing Project, known as Hyde Park, situated at Mullanpur, New Chandigarh, Punjab, total price whereof was fixed at Rs.77,36,860/-. The complainants paid an amount of Rs.11,95,650/- to the opposite parties, in the following manner: -

S.No.	Particulars	Dated	Amount
1.	IFH/CRB/00029/0912	12.09.2012	600000.00
2.	IFH/CRB/00175/1012	26.10.2012	595650.00

 

When despite making payment of above amount, buyer’s agreement was not offered for signing, the complainants sent letter dated 26.10.2012 to the opposite parties, and made a request to get it signed, however, it was not done. Thereafter, the opposite parties raised demand for making further payment by writing letters, on 28.05.2013, 16.05.2014 and 29.05.2014. In the meantime, the complainants wrote letters, with a request to get the agreement signed, however, it was not done. The complainants, thereafter, sought refund of the amount paid, however, nothing was done by the opposite parties, as a result whereof, they filed the present complaint, seeking directions to them (opposite parties), to refund the amount paid, alongwith interest, compensation for mental agony and physical harassment and also to pay litigation expenses.

2.         In the reply filed by the opposite parties, sale of the unit, in question, was not disputed. Price of the said unit, as stated in the complaint, was also not disputed. However, it was stated that after making initial payment, as referred to above, the complainants failed to make further payment, as per schedule. Many reminders were sent to the complainants, to make further payments, towards price of the said unit, but they failed to do so, as a result whereof, allotment of the unit, in question, was cancelled by writing letters dated 09.12.2013 and 23.06.2014 Annexure R-2 colly. Vide last letter, it was intimated to the complainants that the entire amount paid, stood forfeited. Rather, more amount needs to be deposited by the complainants. It was further stated that buyer’s agreement was not deliberately signed by the complainants, despite offer being made to them.

                Territorial and pecuniary jurisdiction of this Commission was challenged. It was stated that since in the present case, agreement was not executed between the parties, as such, the complainants are not consumers and consumer complaint is not maintainable. It was further pleaded that the complainants are not consumers, as they have not purchased the unit for their own use.  It was averred that the present dispute cannot be adjudicated by this Commission, as the proceedings before it, are summary in nature. It was stated that the complaint filed is beyond limitation. Prayer has been made to dismiss the complaint.

3.         The contesting parties led evidence, in support of their case.
4.         We have heard the contesting parties, and have gone through record of the case, very minutely.
5.         When notice of motion was issued in this case, on 16.04.2018, following statement of Counsel for the complainants was noted: -

“Sh. Narender Yadav, Advocate, Counsel for the complainants states that may be after forfeiting part of earnest money amount the builder is bound to refund the balance amount in terms of judgment of Hon'ble National Consumer Disputes Redressal Commission, New Delhi in case titled Shri Harjinder S. Kang Vs. M/s Emaar MGF Land Ltd., 2016  (4) C.P.J 415.”

 

6.         First, we will deal with the objection raised by the opposite parties to the effect that since the unit, in question, is situated at Mohali, Punjab, as such, this Commission has got no territorial jurisdiction to entertain and decide this complaint. After taking notice of provisions of Section 17 (2) (a) and (c) of the Act, the objection raised needs rejection. Relevant provisions read thus:-

 “Section 17 in the Consumer Protection Act, 1986

17.  [(2) A complaint shall be instituted in a State Commission within the limits of whose jurisdiction,—

(a) the opposite party or each of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain; or

(b) …………………..

(c) the cause of action, wholly or in part, arises.]”

 

                It is specifically stated that a complainant can file a complaint in the State Commission, within the limits of whose jurisdiction, the opposite party(s) actually and voluntarily resides or carries on business. It is evident from almost all the documents (except or one two) that the same have been issued in favour of the complainants, by Chandigarh Office of the Company i.e. Chandigarh Technology Park, Plot No.2, Tower-D, Ground Floor, Chandigarh or SCO No.190-191-192, Sector 8-C, Chandigarh.  It is well settled law that Jurisdiction of the Consumer Fora cannot be excluded from a place, where a part of cause of action accrued to the consumers/complainants to file a complaint, irrespective of the fact that the property is situated at any place. In view of above, objection taken by the opposite parties, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected. 

7.         Another objection taken by the opposite parties, with regard to pecuniary jurisdiction of this Commission, also deserves rejection. It may be stated here that as per Section 17 (1) (a) of the Act, the State Consumer Disputes Redressal Commission shall have pecuniary jurisdiction to entertain any complaint, complaints where the value of the goods or services and compensation, if any, claimed exceeds rupees twenty lakhs but does not exceed rupees one crore. It was also so elucidated elaborately by a Large Bench of the National Commission in the case titled as Ambrish Kumar Shukla and 21 ors. Vs. Ferrous Infrastructure Pvt. Ltd., Consumer Case No.97 of 2016, decided on 07.10.2016.  Relevant part of the said order reads thus:-

“It is evident from a bare perusal of Sections 21, 17 and 11 of the Consumer Protection Act that it’s the value of the goods or services and the compensation, if any, claimed which determines the pecuniary jurisdiction of the Consumer Forum.  The Act does not envisage determination of the pecuniary jurisdiction based upon the cost of removing the deficiencies in the goods purchased or the services to be rendered to the consumer.  Therefore, the cost of removing the defects or deficiencies in the goods or the services would have no bearing on the determination of the pecuniary jurisdiction.  If the aggregate of the value of the goods purchased or the services hired or availed of by a consumer, when added to the compensation, if any, claimed in the complaint by him, exceeds Rs. 1.00 crore, it is this Commission alone which would have the pecuniary jurisdiction to entertain the complaint.  For instance if a person purchases a machine for more than Rs.1.00 crore, a manufacturing defect is found in the machine and the cost of removing the said defect is Rs.10.00 lacs, it is the aggregate of the sale consideration paid by the consumer for the machine and compensation, if any, claimed in the complaint which would determine the pecuniary jurisdiction of the Consumer Forum.  Similarly, if  for instance, a house is sold for more than Rs.1.00 crore, certain defects are found in the house, and the cost of removing those defects is Rs.5.00 lacs, the complaint would have to be filed before this Commission, the value of the services itself being more than Rs.1.00 crore.”

 

8.         In the present case, total value of the unit, in question, i.e. Rs.77,36,860/- plus compensation claimed by way of interest @18% p.a. on the deposited amount of Rs.11,95,650/- and also Rs.2 lacs, for mental agony, physical harassment etc., if taken into consideration, in no way, exceeds Rs.1 crore. Thus, this Commission has got pecuniary Jurisdiction, to entertain and decide the complaint.  Objection taken by the opposite parties, that this Commission lacks pecuniary jurisdiction, being devoid of merit, must fail and the same stands rejected.
9.         Further contention was raised by Counsel for the opposite parties that the complainants are investors, as such, they are not consumers. We are not going to accept this contention. It may be stated here that there is nothing on the record that the complainants are the property dealers, and deal in the sale and purchase of property, on regular basis, and as such, the unit, in question, was purchased by them, by way of investment, with a view to resell the same, as and when, there was escalation in the prices thereof. Thus, in the absence of any cogent evidence, in support of the objection raised by the opposite parties, mere bald assertion to that effect, cannot be taken into consideration. Since the opposite parties have levelled allegations against the complainants, the onus lay upon them, to place on record, documentary evidence in that regard, which they failed to do so. Otherwise also, in a case titled as Kavita Ahuja Vs. Shipra Estate Ltd. and Jai Krishna Estate Developer Pvt. Ltd. 2016 (1) CPJ 31, decided by the National Consumer Disputes Redressal Commission, New Delhi, it was held that the buyer(s) of the residential unit(s), would be termed as consumer(s), unless it is proved that he or she had booked the same for commercial purpose. Similar view was reiterated by the National Commission, in DLF Universal Limited Vs Nirmala Devi Gupta,  2016 (2) CPJ 316. As such, objection taken in this regard, stands rejected.
10.         It is not in dispute, that the unit was sold in favour of the complainants, for a sum of Rs.77,36,860/-. Initially, the complainants paid an amount of Rs.11,95,650/- to the opposite parties, towards part price of the said unit. Thereafter, it appears that the complainants failed to make further payments, despite reminders received by them, on the pretext that opposite party no.1 has failed to offer agreement for their signatures. To the contrary, it is stated by the opposite parties that agreement was deliberately not signed by the complainants. When despite sending reminders, the complainants failed to make the payments, as demanded by the opposite parties, unit allotted to them was cancelled vide letters dated 09.12.2013 and 23.06.2014, Annexures R-2 colly. Perusal of contents of letter dated 23.06.2014 indicates that opposite party no.1 calculated forfeitable amount, for default committed on the part of the complainants, @ Rs.16,16,835.55 ps. i.e. Rs.6,74,160/- towards earnest money (inclusive of S.Tax) and Rs.9,42,675/- towards delayed payment interest. We are of the considered opinion that when cancellation of allotment of the unit was made by the opposite parties, there was no justification to burden the complainants, with delayed payment interest. After forfeiting the earnest money, equal to about 10% of the sale consideration, rest of the amount should have been refunded, immediately, to the complainants, however, it was not so done, by the opposite parties and in an arbitrary manner, they kept on utilizing the same. At the time of arguments, Sh.Parveen Jain, Advocate, Counsel for the opposite parties, stated that the amount, as shown in the letter dated 23.06.2014, was rightly forfeited. However, when confronted with the ratio of judgment of the National Commission, titled as Shri Harjinder S. Kang (supra), he failed to justify the stand taken by the opposite parties. In Shri Harjinder S. Kang (supra), similar question came up for consideration, before the National Commission and it was observed as under: -

“The case of the opposite party is that as per Clause 2(f) of the Buyers' Agreement, extracted hereinabove, 15% of the total sale price constitutes the Earnest Money which they were entitled to forfeit.  However, it has been held by this Commission in DLF Ltd., Vs. Bhagwanti Narula, Revision Petition No.3860 of 2014, decided on 06.1.2015, that an amount exceeding 10% of the total price of the property cannot be forfeited as Earnest Money unless the opposite party can show that it has suffered loss to the extent of the amount actually forfeited by it.  Applying the principle laid down in the above referred decision of this Commission, the opposite party could have forfeited only a sum of Rs.12,77,475/- from the amount paid to it by the complainant.  The balance amount of Rs.71,97,275/- (84,74,750/- - 12,77,475/-) was required to be refunded to the complainant, which the opposite party has failed to do.

14.   In the event of the failure of the allottee to make the timely payment of the sale consideration, the agreement could be terminated after a delay of more than thirty days from the due date.  In the present case, the default on the part of the complainant occurred for the first time on 26.4.2013 since the instalment payable on that date was not paid in full.  Therefore, the agreement could have been terminated on 26.5.2013.  The opposite party however, failed to do so and continued to utilize the entire amount, which the complainant had paid to it from time to time.  The opposite party therefore, must compensate the complainant by paying compensation by way of interest on the balance amount of Rs.71,97,275/- with effect from 26.5.2013.”

                The claim of the complainants is squarely covered by ratio of the judgment, referred to above. It is admitted by the opposite parties that qua the unit, earnest money was fixed at Rs.6,74,160/- (it was so reflected in cancellation letter dated 23.06.2014). At the maximum, the said amount should have been forfeited and not the entire amount paid. In a way, the opposite parties were bound to refund an amount of Rs.5,21,490/- (Rs.11,95,650/- minus (-) Rs.6,74,160/-), immediately, after issuance of cancellation letter dated 23.06.2014 aforesaid. It is well settled law that whenever money has been received by a party which ex ae quo et bono ought to be refunded, the right to interest follows, as a matter of course. The obligation to refund money received and retained without right implies and carries with it, the right to interest. It was also so said by the Hon`ble Supreme Court of India, in UOI vs. Tata Chemicals Ltd (Supreme Court), (2014) 6 SCC 335). By not refunding the aforesaid amount of Rs.5,21,490/- immediately, after cancellation of the allotment of unit, in question, the opposite parties indulged into unfair trade practice and the same also certainly amounted to deficiency, in rendering service, on their part. The complainants are, thus, held entitled to refund of an amount of Rs.5,21,490/- alongwith interest @9% per annum from 23.06.2014 i.e. the date of issuance of final cancellation letter of the unit, in question. In view of above, the opposite parties are also liable to pay compensation to the complainants, for adopting unfair trade practice and deficient in providing service, by not refunding the said amount, as held above. 

11.         Further objection taken by the opposite parties, that the complaint filed by the complainants is barred by time, also stands rejected. It may be stated here that since it has been held by this Commission, that the opposite parties were liable to refund remaining amount of Rs.5,21,490/- after cancellation of the unit, which was not done and at the same time, it is also an admitted fact that the said amount is still being utilized by them (opposite parties), as such, there is a continuing cause of action in favour of the complainants, in view of law laid down by the National Commission in the case of KNK Promoters & Developers Versus. S.N. Padmini, Revision Petition No. 340 of 2011, decided on 31 Aug 2016 and Saroj Kharbanda Versus Bigjo's Estates Limited, First Appeal No. 986 of 2016, decided on 01 Feb 2018, in which it was held that the builder/opposite parties cannot withheld the amount deposited by the allottee and if it is so, there is a continuing cause of action in favour of the allottee, to file a complaint seeking refund of the said amount.
12.         As far as the objection taken by the opposite parties, to the effect that since no agreement in the present case was executed between the parties and only allotment was made, on inviting application form, on  making payment of Rs.11,95,650/- out of which, Rs.6,74,160/- was received as earnest money, as such, the complainants are not consumers, is devoid of merit, in view of principle of law laid down by the National Commission, in C.S. Grewal Vs. M/S. Taneja Developers And Infrastructures Ltd. & 2 Ors., First Appeal No. 543 of 2016, decided on 17 May 2018, in which it was held that after the deposit of earnest money alongwith application for allotment of a unit, a person does fall under the definition of ‘consumer’.
13.         Another objection was taken by the opposite parties, in their written version, that consumer complaint was not maintainable before this Commission, as the proceedings under it are summary, in nature. It may be stated here that the complainants hired the services of the opposite parties, for purchasing the unit, in question, in the manner, referred to above. It is a simple case, wherein, instead of making further payments after making payment of initial amount of Rs.11,95,650/-, the complainants sought refund of the amount deposited, as buyer’s agreement was not sent to them for signatures. Thereafter, despite receiving reminders from the opposite parties, they failed to make payment, resulting into forfeiture of the entire amount paid, which act has been held to be unjustified on the part of the opposite parties, as per the prevailing law. Such like matters, are being covered under the purview of the Act, and have been adjudicated by the Consumer Foras, earlier, a number of times. It is a simple case of non-refund of the remaining amount, after forfeiture, by the opposite parties, to the complainants, which fact is not disputed. As such, this Commission can very well adjudicate this complaint instead of relegating it to the Civil Court. Objection taken in this regard, also stands rejected.
14.         No other point was urged by the contesting parties.
15.         For the reasons recorded above, this complaint is partly accepted, with costs. The opposite parties, jointly and severally are directed as under: -

1.     To refund an amount of  Rs.5,21,490/- to  the complainants, alongwith interest @9% p.a., from 23.06.2014 i.e. the date of issuance of final cancellation letter onwards.
2.     To pay Rs.50,000/- as compensation, towards deficiency in providing service, adoption of unfair trade practice, and also causing mental agony, physical harassment to the complainants.
3.     To pay cost of litigation, to the tune of Rs.22,000/- to the complainants.
4.     The payment of awarded amounts mentioned at sr.nos.(i) to (iii), shall be made by the opposite parties, to the complainants, within a period of 45 days, from the date of receipt of a certified copy of this order, failing which, thereafter, they shall be liable to pay the amount mentioned at sr.no.(i), alongwith penal interest @12% p.a. from the date of default (till that period @9% p.a.) and interest @9% p.a., on the amount mentioned at sr.nos. (ii) and (iii), from the date of filing of this complaint, till realization.

16.         However, it is made clear that, if the complainants have availed loan facility from any Bank or financial institution for making payment towards price of the said unit, it shall have the first charge of the amount payable, to the extent, the same is due to be paid by them (complainants).
17.         Certified Copies of this order be sent to the parties, free of charge.
18.         The file be consigned to Record Room, after completion.

Pronounced.

12.07.2018

Sd/-

 [JUSTICE JASBIR SINGH (RETD.)]

PRESIDENT

 

 

Sd/-

 (DEV RAJ)

MEMBER

 

 

Sd/-

 (PADMA PANDEY)

        MEMBER

Rg.