REERVED

State Consumer Disputes Redressal Commission

U.P. Lucknow.

Complaint no.291 of 2018

1- Mrs. Rukhsana Syed w/o Mr. Sharafat Ali,

    R/o Rlat NO.T-3/1205, Eldeco Eternia,

    Sitapur Road, Lucknow.

2- Ms. Ambreen Syed d/o Mr. Sharafat Ali,

    R/o Rlat NO.T-3/1205, Eldeco Eternia,

    Sitapur Road, Lucknow.                         …. Complainants.

Versus

1- Eldeco Housing & Industries Ltd. through

    its Chairman-cum-Managing Director, having

    its Registered Office at 201-212, II Floor,

    Plot No.3, Spelendor Forum, District Center,

    Jasola, New Delhi-110025

2- Eldeco Housing & Industries Ltd. through

    its Project Director, Lucknow Office at

    2^nd Floor, Eldeco Corporate Chamber-1,

   (Opp. Mandi Parishad), Vibhuti Khand,

    Gomti Nagar, Lucknow-226010 (UP)…. Opposite parties.

Present:-

1- Hon’ble Mr. Rajendra Singh, Presiding Member.

2- Hon’ble Mr. Vikas Saxena, Member.

Sri Vishnu Kumar Mishra, Advocate for the Complainants.

Sri Vikas Agarwal, Advocate for the Opp. Parties.

Date  :     04.08.2022

JUDGMENT

Per Mr. Rajendra Singh, Member: This complaint has been filed by the complainant under section 17(1)(a)(i) of the Consumer Protection Act, 1986, for the following reliefs:

1. The opposite parties be directed to pay interest on the deposited amount at a rate of 18% on account of delay of four years and as per the law settled by the Hon’ble opposite Court.
2. The opposite parties be directed to refund the additional amount of Rs.375,474/– which has been extracted by the respondents on various miscellaneous charges and other heads and Rs.360,000/– which has been paid by the complainant in the form of rent due to deficiency in service committed by the respondents.
3.  The opposite parties may be directed to pay the compensation of Rs.1 lakh for the mental agony and harassment.
4. The opposite party be directed to pay Rs.1 lakh to the complainant on account of damages due to deficiency in services of the opposite party and also awards the cost of litigation Rs.50,000/–
5. Further prayed to this Hon’ble Commission that any other order may be passed in accordance with law and same shall be in the interest of justice.

The brief facts of the complaint case are that, that Eldeco Housing and Industries Ltd, a company incorporated under the Companies Act 1956 and having its registered office at 201–212, II floor, plot no.3, Splendor Forum, District Centre, Jasola, New Delhi-110025 and its Lucknow office is at II floor, Eldeco Corporate Chamber-I, (Opp. Mandi Parishad), Vibhuti  Khand, Gomti Nagar, Lucknow – 226010, UP, started with a project called “Eldeo Eternia”, Lucknow at Sitapur Road under the banner of “ELDECO  ETERNIA”. The complainants were looking for their residential purpose a flat or house and represented by the opposite party that the project is being developed by the opposite party in Lucknow at Sitapur road under the banner of “ELDECO ETERNIA”. It has been told by the representative of opposite party, that basic cost for 2 BHK flat having Central Lawn facing is Rs.3,085,500/-. Thereafter the complainants vide application dated 18.03.2011 applied for allotment 2 BHK flat having Central Lawn Facing at “ELDECO  ETERNIA” situated at Sitapur Road, Lucknow. The complainants’ paid the booking amount of Rs.150,000/- + service tax Rs.3863/-.

After booking of flat the opposite parties had issued an allotment letter having Ref no.EE/T3/3034  dated 24.03.2011 and allotted flat no.1205 in Tower-3  consisting of super area ad measuring 112.40 m² or 1210 square ft in the said project. The opposite parties had also informed the complainant about two types of payment plan, vide allotment letter dated  24.03.2011  i.e., Plan–A, Cash Down Payment plan and Plan-B, Time Linked Instalment Plan. The applicant had opted for Plan-A, Cash down Payment Plan accordingly complainants were given a discount of Rs.308,550/- and after adjusting the discount remaining amount was paid by the complainant against the said allotment of flat. As per the allotment letter, it was incumbent upon the opposite parties to complete the construction of the said flat in “ELDECO  ETERNIA” project along with club house bearing approximate area of 112.40 m² in total sale of consideration Rs.3,085,500/- and will hand over the possession after 36 months but within the grace period of six months i.e., within 42 months meaning thereby the opposite parties were required to hand over the possession of the said flat before 23.09.2014 in all cases but the same was not done by the opposite parties.

Despite the above the opposite parties had also demanded Rs.375,474/- on account of other charges on various heads which were not the part of buyers agreement or terms and condition of agreement. As per the Part B, with heading payments clause 2 (a) only levies on additional charge of preferential location charges and no the extra charges were levied or stated to be paid by the buyers. Further on account of maintenance Part (E) with heading maintenance deals only with the maintenance charges which include all the maintenance and upkeep of infrastructure installation. The clause (E ) is reproduced as under:

“ Part  B -payments: (1) (a) ….

2(a) For flats at Preferential Location, Preferential Location Charges (herein ”PLC”), as applicable, shall be payable by the allottees.

Part (E) – Maintenance: 1. On completion of construction work, and/or offer of possession or possession due date (defined herein before) whichever is earlier :-

(a)(i) on completion of the building/allotted unit possession due date, company shall give the offer of possession and shall intimate the amount to be deposited as lump sum deposit for the maintenance and upkeep of infrastructure installation like–lifts, water supply pumps, firefighting system, etc . Maintenance of infrastructure installation means cost of the AMC and repair of breakdowns.

(b)………..

From the above it becomes crystal clear that opposite parties had committed deficiency in service by means of (a) not providing the possession of flat within the stipulated period of buyers agreement,(b) by means of charging extra amount in the form of club development charges amounting to Rs.20,000/–, (c) parking charges amounting Rs.90,000/– (d) External Electrification charges which is nowhere mentioned in the buyer’s agreement/terms and conditions of agreement. (e) firefighting charges, (f) power backup charges and other charges in the head of reimbursement amounting to Rs.197,752/-. Thus the opposite parties had charged extra amount to the tune of Rs.375,474 /– which was not the part of agreement as agreed by the complainant and respondent company as per the terms and conditions of the agreement. The aforesaid demand letter dated 07.02.2015 was raised just to extract money from the complainants and it clearly shows the deficiency and unfair trade practice on the part of the opposite parties and respondent had executed the sale deed of allotted flat after a delay of more than two years from the date of receipt of balance amount as asked by the respondents. As per the terms and conditions of the agreement of said project, opposite parties are required to complete the said project within the period of 36 months but they have failed completely in timely construction. They did not give possession of the said flat within stipulated time. On account of delayed possession the complainants were bound to live in a rental life for more than three years after the retirement of her husband and as such on account of deficiency in service committed by the opposite parties, the complainants were bound to bear and additional expenses of Rs.360,000/– in the form of rent.

Due to breach of the representations and assurances by the opposite parties, the complainant had suffered huge losses and damages and the complainant has been put to several physical and mental tension and for which the opposite party is liable to compensate. In addition to the aforesaid monthly losses and damages caused to the complainant, the opposite parties were also guilty of having committed the offence of criminal breach of trust, cheating and defrauding the complainant as the opposite party had taken the consideration from the complainant on the representation that the possession shall be handed over by completing the project in the year 2014 but failed to hand over the possession of the said flat. The opposite parties have failed to provide proper services according to their assurance and promise but instead they have adopted incorrect and fraudulent methods to extract additional amount which were not included in the terms of the agreement. Since the work is not completed within 36 months as per the term and condition of the contract, opposite parties are liable to refund the amount with the interest and Hon’ble State Consumer Disputes Redressal Commission, UP has jurisdiction to entertain the complainant. Therefore it is most respectfully prayed that this Hon’ble Commission may kindly be pleased to grant the above mentioned reliefs.

The opposite parties have stated in their written statement that the complaint case is false, malicious, incorrect and malafide and is nothing but an abuse of the process of the law and it is an attempt to waste the precious time Of This Hon’ble Commission, as the same has been filed by the complainant shall just to avail undue advantage. The complaint case is thus liable to be dismissed. The opposite parties at the very beginning state that there has been no negligence or deficiency in services whatsoever on their part in dealing with the flat in question. The instant complaint case lacks cause of action since the possession of the flat in question was already delivered in the year 2015 and the sale deed of the flat in question has also been executed in 2017 and the present complaint Case has been filed after the lapse of limitation of two years as such the present case is liable to be dismissed. Initially on 18.03.2011 complainants are jointly given application form for allotment of the flat in the group Housing scheme namely “Eldeco Eternia” situated at Sitapur road. Upon the aforesaid application on 24.03.2011 the respondents allotted flat number T-3-1205 having super area 1210 square Ft in the group housing scheme “Eldeco Eternia” and issued Allotment Certificate and Agreement in which terms and conditions are duly mentioned in favour of complainants. The complainants opted instalment payment plan and the last instalment was paid on 10.11.2014 by the complainant and as per instalment payment plan possession of the unit was due after three months of the last payment + six months grace period as such possession was due in August 2015 while the respondent issued offer of possession in February 2015 as such there was no delay in handing over the possession of the unit. On 07.02.2015 respondents issued Final Demand Notice/offer of possession of the unit in question and the dues were demanded as per terms and conditions of the Allotment Certificate Agreement Dtd 24.03.2011.

On 03.08.2015 the complainants requested to the respondents for providing possession of unit and gave an undertaking dated 03.08.2015 that the complainant will execute the sale deed of the unit subsequently and after considering the request and undertaking of the complainants, the possession of the unit was given to him and the possession certificate was executed on 28.09.2015 the complainants had taken possession of the unit peacefully and voluntarily and residing in their unit in question from 28.09.2015. The maintenance and other charges shall be payable which was duly intimated to the complainants at the time of booking of the unit which was duly paid by the complainants are without any protest. Thereafter on 13.04.2017 the sale deed of the unit in question was duly registered after being satisfied with the cost and allied charges. As such after taking possession with full satisfaction and execution of sale deed with full satisfaction, now the complainants cannot raise any demand from the respondents. On 28.09.2015 physical possession of the unit/flat in question was handed over to the allottees/complainants which was taken by the complainant with full satisfaction. Thereafter, car parking documents as well as maintenance agreement were also executed between the parties. It is important to mention here that the respondents are handed over the maintenance of common services of their project in question to the RWA/Resident Welfare Association of the residents of the Eldeco Eternia and now all the maintenance of the Eldeco Eternia is managed by the RWA. The complainants are bound by their undertaking and the terms and conditions of the allotment. So keeping in all the above submission made by the respondents are, This Hon’ble Commission may please to treat the complaint as non-maintainable.

We have heard the ld. Counsel for the complainants Sri Vishnu Kumar Mishra and ld. Counsel for the opposite parties Sri Vikas Agarwal. We perused the pleadings, evidence and documents on record.  

In this case it is clear that the sale deed has been executed on 13.04.2017. Possession of the flat has been given on 28.09.2015. As per agreement the possession was to be delivered on 24.09.2014. So in the delivery of possession there is delay of about 12 months. It is admitted to both the parties and the documents have been filed by them. Now as the delay has been caused by the opposite party, the complainant is entitled to for damages for a period of 12 months.

If in any project no date of delivery of possession has been given, whether it means infinite time? In such cases the Court observes reasonable time to deliver the possession to a allottee.However the Hon’ble Supreme Court in CIVIL APPEAL NO(S). 3533-3534 OF 2017 M/S. FORTUNE INFRASTRUCTURE (NOW KNOWN AS M/S. HICON INFRASTRUCTURE) & ANR. VS TREVOR D’LIMA & ORS. ( Judgement March 12 , 2018 ) has held:

“15. Moreover, a person cannot be made to wait indefinitely for the possession of the flats allotted to them and they are entitled to seek the refund of the amount paid by them, along with compensation. Although we are aware of the fact that when there was no delivery period stipulated in the agreement, a reasonable time has to be taken into consideration. In the facts and circumstances of this case, a time period of 3 years would have been reasonable for completion of the contract i.e., the possession was required to be given by last quarter of 2014. Further there is no dispute as to the fact that until now there is no development of the property. Hence, in view of the above discussion, which draw us to an irresistible conclusion that there is deficiency of service on the part of the appellants and accordingly the issue is answered. When once this Court comes to the conclusion that, there is deficiency of services, then the question is what compensation the respondents/complainants is entitled to ?”

In the above-mentioned case Hon’ble Supreme Court also held regarding payment of compensation or quantum of compensation as follows:

“18. This Court in Ghaziabad Development Authority v. Balbir Singh, (2004) 5 SCC 65, has observed that there is no fixed formula for fixing damages in the following manner:

          ‘8. However, the power and duty to award compensation does not mean that irrespective of facts of the case compensation can be awarded in all matters at a uniform rate of 18% per annum. As seen above, what is being awarded is compensation i.e. a recompense for the loss or injury. It therefore necessarily has to be based on finding of loss or injury and has to correlate with the amount of loss or injury. Thus, the Forum or the Commission must determine that there has been deficiency in service and/or misfeasance in public office which has resulted in loss or injury. No hard-and-fast rule can be laid down, however, a few examples would be where an allotment is made, price is received/paid but possession is not given within the period set out in the brochure. The Commission/Forum would then need to determine the loss. Loss could be determined on basis of loss of rent which could have been earned if possession was given and the premises let out or if the consumer has had to stay in rented premises then on basis of rent actually paid by him.Along with recompensing the loss the Commission/Forum may also compensate for harassment/injury, both mental and physical. Similarly, compensation can be given if after allotment is made there has been cancellation of scheme without any justifiable cause. 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. In cases where possession is being directed to be delivered the compensation for harassment will necessarily have to be less because in a way that party is being compensated by increase in the value of the property he is getting. But in cases where monies are being simply returned then the party is suffering a loss inasmuch as he had deposited the money in the hope of getting a flat/plot. He is being deprived of that flat/plot. He has been deprived of the benefit of escalation of the price of that flat/plot. Therefore, the compensation in such cases would necessarily have to be higher. … We clarify that the above are mere examples. They are not exhaustive. The above shows that compensation cannot be the same in all cases irrespective of the type of loss or injury suffered by the consumer.” (emphasis supplied)

Before discussing further, we have to see the basic object of the Consumer Protection Act.

The Consumer Protection Act, came into existence and implemented in 1986, provides Consumer Rights to prevent consumers from fraud or specified unfair practices. It safeguards and encourages and gives an opportunity to consumers to speak against insufficiency and flaws in goods and services. If traders, manufacturers and distributors follow any foul trade, this act protects their rights as a consumer.

This Protection Act covers entire goods and services of all sectors that are public, private, or cooperative sectors, except those exempted by the central government. The act provides a floor for a consumer where one can file their complaint against the product and the forum takes an action against the concerned supplier and compensation is granted to the consumer for the inconvenience he/she has encountered. The objectives of the consumer petition act may be summarised as –

• To Provide better and all round protection to consumer.
• To Provide machinery for the speedy redressal of the grievances.
• To Create framework for consumers to seek redressal.
• To Provide rights to consumers.
• To Safeguarde rights of Consumers.

What are the rights of consumers?Let us know more about the rights of consumer. Listed below are the Rights of the Consumer:

• Right to Safety- Before buying, a consumer can examine on the quality and guarantee of the goods and opt for ISI or AGMARK products.
• Right to Choose- Consumer must have the right to choose from a variety and number of goods and in a competitive price
• Right to be informed- The buyers must be provided with complete information with all the necessary and adequate details of the product, make her/him act wise, and change the buying decision.
• Right to Consumer Education- The consumer must be aware of his/her rights and avoid exploitation.
• Right to be heard- The consumer will get due attention to express their grievances at a suitable platform.
• Right to seek compensation- The consumer has the right to seek or ask for redressal against unfair and inhumane practices or exploitation of the consumer.

So it is clear that the Consumer Protection Act has been passed to safeguard the interest of the consumers.

Now we come to the facts of the present case. There is not a single word regarding completion certificate, occupancy certificate, NOC from pollution department, NOC from civil aviation Department and NOC from fire department. Without these, offer of giving possession is no offer in the eye of law.

In the case ofFaqir Chand Gulati  Vs.   Uppal Agencies Pvt. Ltd. & Anr., Civil appeal no.3302 of 2005, judgment dated 10.06.2008, Hon’ble Supreme Court has held that a prayer for completion certificate and C&D Forms cannot be brushed aside by stating that the builder has already applied for the completion certificate or C&D Forms. If it is not issued, the builder owes a duty to make necessary application and obtain it. If it is wrongly withheld, he may have to approach the appropriate court or other forum to secure it. If it is justifiably withheld or refused, necessarily the builder will have to do whatever is required to be done to bring the building in consonance with the sanctioned plan so that the municipal authorities can inspect and issue the completion certificate and also assess the property to tax. If the builder fails to do so, he will be liable to compensate the complainant for all loss/damage.

Hon’ble Supreme Court in the case ofIreo Grace Realtech Private Limited  Vs.  Abhishek  Khanna &Ors., civil appeal no.5785 of 2019, with other civil appeals, judgment 11.01.2021,has held where the development makes an alternate offer of allotment of apartment, the allottees are however not bound to accept the same because of inordinate delay in completing the construction of the towers or units were allotted to them and if the Occupation Certificate is not available even as on date, clearly amounts to deficiency of service.

Now it is clear that the reasonable period for handing over the possession of the flat/plot is three years from the date of allotment order and also a grace period of six months, therefore the total. Comes 42 months from the date of allotment. So the possession should have been given on 24 September 2014, it has not been given on the said cut of date and there is delay of about 12 months.

Now some case laws of Hon’ble Supreme Court and Hon’ble NCDRC are to be discussed in this light.

In  R. V. Prasannakumaar v. Mantri Castles Pvt. Ltd., 2019 SCCon Line SC 224, under the terms of the ABA, possession of the flats was to be handed over to the buyers on 31 January 2014. However, the developer received an occupation certificate only on 10 February 2016 and it was thereafter from May 2016 that the developer started issuing letters offering possession. Based on this, the NCDRC awarded compensation in the form of interest at the rate of 6 per cent per annum. The developer had pleaded that since the agreement provided compensation at the rate of Rs.3 per square foot per month for delayed possession, the purchasers were not entitled to anything in addition. Dealing with the submission, this Court observed:

“9. We are in agreement with the view of the NCDRC that the rate which has been stipulated by the developer, of compensation at the rate of Rs.3 per sq. ft. per month does not provide just or reasonable recompense to a flat buyer who has invested money and has not been handed over possession as on the stipulated date of 31 January 2014. To take a simple illustration, a flat buyer with an agreement of a flat measuring a 1000 sq. ft. would receive, under the agreement, not more than Rs. 3000/- per month. This in a city such as Bangalore does not provide just or adequate compensation. The jurisdiction of the NCDRC to award just compensation under the provisions of the Consumer Protection Act, 1986 cannot in the circumstances be constrained by the terms of the agreement. The agreement in its view is one sided and does not provide sufficient recompense to the flat purchasers.”

The Court observed that there was a delay of two years and hence the award of interest at the rate of 6 per cent was reasonable and justified.

In Pioneer Urban Land and Infrastructure Limited v. Govindan Raghavan, (2019) 5 SCC 725, there was a delay of almost two years in obtaining an occupancy certificate after the date stipulated in the ABA. As a consequence, there was a failure to provide possession of the flat to the purchaser within a reasonable period. This Court dwelt on the terms of the ABA under which the builder was entitled to charge interest at 18 per cent per annum for the delay in payment of instalments by the purchaser. On the other hand, the failure to provide possession on the part of the developer was subject to a grace period of twelve months followed by a termination notice of ninety days and a further period of ninety days to the developer to effect a refund. Adverting to these clauses, the court noted:

“6.4. A perusal of the apartment buyer's agreement dated 8-5- 2012 reveals stark incongruities between the remedies available to both the parties. For instance, Clause 6.4(ii) of the agreement entitles the appellant builder to charge interest @18% p.a. on account of any delay in payment of instalments from the respondent flat purchaser. Clause 6.4(iii) of the agreement entitles the appellant builder to cancel the allotment and terminate the agreement, if any instalment remains in arrears for more than 30 days. On the other hand, as per Clause 11.5 of the agreement, if the appellant builder fails to deliver possession of the apartment within the stipulated period, the respondent flat purchaser has to wait for a period of 12 months after the end of the grace period, before serving a termination notice of 90 days on the appellant builder, and even thereafter, the appellant builder gets 90 days to refund only the actual instalment paid by the respondent flat purchaser, after adjusting the taxes paid, interest and penalty on delayed payments. In case of any delay thereafter, the appellant builder is liable to pay interest @9% p.a. only. Another instance is Clause 23.4 of the agreement which entitles the appellant builder to serve a termination notice upon the respondent flat purchaser for breach of any contractual obligation. If the respondent flat purchaser fails to rectify the default within 30 days of the termination notice, then the agreement automatically stands cancelled, and the appellant builder has the right to forfeit the entire amount of earnest money towards liquidated damages. On the other hand, as per Clause 11.5(v) of the agreement, if the respondent flat purchaser fails to exercise his right of termination within the time limit provided in Clause 11.5, then he shall not be entitled to terminate the agreement thereafter, and shall be bound by the provisions of the agreement.”

Hon’ble Justice Indu Malhotra speaking for the Court noted:

“6.8. A term of a contract will not be final and binding if it is shown that the flat purchasers had no option but to sign on the dotted line, on a contract framed by the builder. The contractual terms of the agreement dated 8-5-2012 are ex facie one-sided, unfair and unreasonable. The incorporation of such one-sided clauses in an agreement constitutes an unfair trade practice as per Section 2(1)(r) of the Consumer Protection Act, 1986 since it adopts unfair methods or practices for the purpose of selling the flats by the builder.” The Court observed that in these circumstances, the flat purchasers could not be compelled to obtain possession which was offered almost two years after the grace period under the agreement had expired. Hence, the NCDRC was held to have correctly awarded interest at the rate of 10 percent per annum.

The decision of this Court in Dhanda Case, 2019 SCC On Line SC 689  has been relied upon by learned Senior Counsel appearing on behalf of the developer as elucidating the principle that where a flat buyers agreement stipulates a consequence for delayed possession, exceptional and strong reasons must be established before the forum constituted under the Act of 1986 awards compensation in addition to what has been contractually agreed. In Dhanda’s case, the SCDRC issued a direction for handing over physical possession of the residential unit to the complainant and for execution of a sale deed. In addition, compensation was awarded by way of interest at the rate of 12 per cent per annum with effect from twelve months after the stipulated date under the agreement. In an appeal by the developer, the NCDRC directed that the rate of interest for a house building loan for the corresponding period in a scheduled nationalised bank would be appropriate and if a floating rate of interest was prescribed, the higher rate of interest should be taken for the computation. A sum of Rs.1 lac per annum from the date for handing over possession to the actual date of possession was regarded as appropriate in the facts of the case. In that case under the terms of the buyer’s agreements, possession was to be delivered within twenty-four months of the execution of the agreement i.e. 10 February 2013 – failing which the developer was liable to pay compensation at the rate of Rs.10 per square foot per month for the delay. The developer contended that construction activities were delayed as a result of an injunction granted by this Court over a period of eight months and consequently sought an extension of the period for handing over possession by one year. Alternatively, the developer offered to refund the money deposited with interest at 9 per cent per annum. Construction of 258 independent floors was completed while about 1,500 units were nearing completion. In two sets of Civil Appeals which came up before this Court earlier, agreed terms were arrived at providing for the award of interest at 9 per cent per annum from the date of deposit till refund. While considering the order of the NCDRC, this Court observed:

“16. The District Forum under the Consumer Protection Act, 1986 is empowered inter-alia to order the opposite party to pay such amount as may be awarded as compensation to the consumer for any loss or injury suffered by the consumer due to the negligence of the opposite party including to grant punitive damages. But the forums under the Act cannot award interest and/or compensation by applying rule of thumb. The order to grant interest at the maximum of rate of interest charged by nationalised bank for advancing home loan is arbitrary and no nexus with the default committed. The appellant has agreed to deliver constructed flats. For delay in handing over possession, the consumer is entitled to the consequences agreed at the time of executing buyer's agreement. There cannot be multiple heads to grant of damages and interest when the parties have agreed for payment of damages at the rate of Rs. 10/- per sq. ft. per month. Once the parties agreed for a particular consequence of delay in handing over of possession then, there has to be exceptional and strong reasons for the SCDRC/NCDRC to award compensation at more than the agreed rate.”

Now the interest may be 6% to 10% in favour of the allottees if they have not been given possession of the flat/plot within promised or within a reasonable time. The complainant has deposited the entire agreed cost of the flat before June 2009. Now it is the duty and obligation of the opposite party to deliver the possession within stipulated time but they failed to do so.

In  the  case  of   PRIYANKA MITTAL & ANR. V. PARSVNATH DEVELOPERS LTD. & ANR. (NCDRC). These appeals arise out of single order of State Commission, hence, decided by common order. These appeals have been filed against the order dated 25.2.2015 in Complaint Nos. 18 of 2013- Nalin Bhargava & Anr. Vs. Parsvnath Developers Ltd. & Anr.; 34 of 2013- Jasleen Viswanathan & Anr. Vs. Parsvnath Developers Ltd. & Anr.; 58 of 2011- Janmejai Mani Tiwari Vs. Parsvnath Developers Ltd. & Anr.; 68 of 2013- Indu Singh Vs. Parsvnath Developers Ltd. & Anr.; 69 of 2013- Poonam Sagar Vs. Parsvnath Developers Ltd. & Anr.; 86 of 2010- Priyanka Mittal & Anr. Vs. Parsvnath Developers Ltd. & Anr.; 101 of 2011- Mohd. Aslam Khan & Anr. Vs. Parsvnath Developers Ltd. & Anr.; 130 of 2012- Dr. Sunil Kr. Singh &Anr. Vs. Parsvnath Developers Ltd. & Anr.; 49 of 2012- Neera Mittal & Anr. Vs. Parsvnath Developers Ltd. & Anr.; 74 of 2011- Deepak Bhalla Vs. Parsvnath Developers Ltd. & Anr.; 87 of 2010- Syed Gufran Ali Alvi & Anr. Vs. Parsvnath Developers Ltd. & Anr.; 96 of 2011- Uppasana Malik Vs. Parsvnath Developers Ltd. & Anr.; 175 of 20130- Umesh Chandra Dixit & Anr. Vs. Parsvnath Developers Ltd. & Anr.; 97 of 2011- Pravin Kumar Goel & Anr. Vs. Parsvnath Developers Ltd. & Anr. which complaints were partly allowed.

          The  Hon’ble  NCDRC  held that:

“Brief facts of the cases are that opposite parties/respondents are engaged in the activity of housing construction and accordingly they have launched a project named as Parsvnath Planet situated in Gomti Nagar, Lucknow. The project was demonstrated to be very lucrative and made attractive to the vendees, in order to procure/collect money from the needy persons demonstrating themselves to be excellence in the field of construction activity as compared to other builders and assured the buyers/complainants that it has been duly approved by the Lucknow Development Authority and necessary permission has also been obtained from them. The emphasis was made by the opposite parties that the possession of the Unit shall be given within a scheduled period of 36+6=42 months stipulated in agreements executed in between the parties for the project launched in the year 2006. The complainants/appellants attracted by the promise and assurance of the opposite parties, somehow managed and arranged the money from their personal sources as well as on loan at attractive rate of interest and the hard earned money was paid by them to the opposite parties in a hope that the possession of the units shall be provided to them in the year 2009 and they can leave peacefully in their own houses, since the complainants are living in rented houses. ”

“The complainants visited the construction site of the opposite parties after depositing the entire amount, where it was revealed that the construction activities were on halt and the persons available on the site told the complainants that the apartments are likely to be completed till 2015. Even the partial construction done by the opposite parties was defective and did not match the specifications provided in the agreement. The complainants were shocked on hearing it and observing the site. The complainants immediately contacted the Area Manager, who told the complainants that there is some delay in the construction of the apartment and the apartments shall be ready till June, 2010. The complainants have to repay the amount taken on loan alongwith interest without getting the possession of the allotted units causing irreparable loss and injury to them. The complainants have come to know that the opposite parties have invested the funds earmarked for this project into their other projects in other city due to which they have not been able to complete the project in time. Besides this, it has also come to the light that although the opposite parties had collected huge funds from the buyers but in spite of that the opposite parties have miserably failed to pay the dues of Lucknow Development Authority which forced the Lucknow Development Authority to issue coercive measures against the opposite parties for the recovery of their dues. Alleging deficiency on the part of opposite parties/ respondents, complainants filed separate complaints before State Commission. Aggrieved  by  the  order  of  Hon’ble  State  Commission, these  appeals preferred  before Hon’ble National  Consumer  Disputes  Redressal  Commission.”

Hon’ble  NCDRC discussed various  case  laws  and  after  hearing  the  parties held,

“Learned Counsel for appellants submitted that as complainants have been deprived of possession for a long period beyond agreed period, it amounts to restrictive trade practice under  and complainants are entitled to get compensation. Section 2 (nnn) runs as under:- means a trade practice which tends to bring about restrictive trade practice manipulation of price or its conditions of delivery or to affect flow of supplies in the market relating to goods or services in such a manner as to impose on the consumers unjustified costs or restrictions and shall include- Delay beyond the period agreed to by a trader in supply of such goods or in providing the services which has led or is likely to lead to rise in the price; Any trade practice which requires a consumer to buy, hire or avail of any goods, or, as the case may be, services as condition precedent to buying, hiring or availing of other goods or services; Perusal of aforesaid provision reveals that when opposite party delays in delivery of goods which leads to rise in the price of goods meaning thereby, more price is charged from complainant, it amounts to restrictive trade practice. In the case in hand, opposite party on account of delayed delivery of possession is not charging higher rate than the agreed rate for delivery of possession of flat, so, it does not fall within the purview of restrictive trade practice under  

Admittedly, agreements were executed in 2006 and as per agreements, possession of flats was to be delivered within 42 months, meaning thereby, possession was to be given in the year 2009-2010 and possession has not been handed over so far though year 2016 has started. No doubt, complainants are entitled to get penalty amount for delayed delivery of possession as per clause 10 ( c) of the agreement but opposite party cannot be permitted to avail benefit of aforesaid clause for indefinite period. This penalty clause should be allowed for the benefit of parties for a limited period and in the cases in hand, I deem it appropriate to extend applicability of aforesaid clause for a period of one year beyond 42 months and after that, complainants are certainly entitled to compensation. Opposite party cannot be allowed to avail huge funds of complainants by paying merely Rs. 5/- per sq. ft. for example, complainants who have purchased flat measuring 164.901 sq. mtr., they have made payment of about Rs. 31.00 to 32 lakhs and in the garb of clause 10 (c), opposite party is paying penalty @ approximately Rs. 9,000/- per month against enjoying funds more than Rs. 30.00 lakhs. As complainants have been deprived to shift to their flats for a long period which would not only have given them satisfaction of living in their own house but also have raised their social status and opposite party has enjoyed funds of complainants for a long period, I deem it appropriate to allow compensation @ Rs. 15,000/- p.m. to the complainants who have applied for flats upto 175 sq. mtr and Rs. 20,000/- per month to complainants who have applied for flats above 175 sq. after 54 months of execution of agreement till delivery of possession.”

Against this judgment, parties went to Hon’ble  Supreme  Court. The judgment of Hon’ble  Supreme  Court is:-

In  Nalin Bhargava  vs.  Parsvnath Developers Ltd. CA 6662/2018 @ SLP(C) 7596/2016 etc and other related civil appeals on 13 July, 2018, Hon’ble Supreme Court held:-

          “Leave granted in all the special leave petitions.CA 6662/2018 @ SLP(C) 7596/2016 etc.          

            It is submitted by Mr. M.L. Lahoty, learned counsel appearing for the appellants in all the appeals that the possession has been handed over and the deficiencies have been removed and, therefore, he has no grievance. However, Mr. Lahoty would insist that there should be imposition  of  costs as compensation.

            Mr. Sachin Datta, learned senior counsel appearing for the developer has raised   objections    with regard to imposition of costs.

            Having heard learned counsel for the parties, we are of the considered opinion that the cause of justice would be best subserved if each of the appellants in the present appeals are given Rs.1,50,000/- (Rupees one lakh fifty thousand only) per flat, towards costs. When we say “cost”, we mean costs alone and nothing else.”

            In the case of Kolkata West International City Pvt. Ltd. Vs. DevasisRudra[Civil Appeal No. 3182 of 2019 @ SLP (C) No(S). 1795 of 2017] judgment delivered on 25.03.2019, the Hon’ble Supreme Court has held:-

            “Interestingly, where the buyer is in default, the agreement stipulates that interest at the rate of 18 per cent from the date of default until the date of payment would be charged for a period of two months, failing which the allotment would be cancelled by deducting 5% of the entire value of the property. The agreement was evidently one sided. For a default on the part of the buyer, interest at the rate of 18% was liable to be charged. However, a default on the part of the developer in handing over possession would make him liable to pay interest only at the savings bank rate prescribed by the SBI. There is merit in the submission which has been urged by the buyer that the agreement was one sided.

            In  the Case  of Wg. Cdr. Arifur Rahman Khan and Aleya Sultana and Ors.  Versus  DLF Southern Homes Pvt. Ltd (now Known as BEGUR OMR Homes Pvt. Ltd.) and Ors.   (Civil Appeal No. 6239 of 2019 With Civil Appeal No. 6303 of 2019); The  Hon’ble  Supreme  Court  has  held:-

            “24. A failure of the developer to comply with the contractual obligation to provide the flat to a flat purchaser within a contractually stipulated period amounts to a deficiency. There is a fault, shortcoming or inadequacy in the nature and manner of performance which has been undertaken to be performed in pursuance of the contract in relation to the service. The expression “service” in Section 2 (1) (o) means a service of any description which is made available to potential users including the provision of facilities in connection with (among other things) housing construction. Under Section 14(1)(e), the jurisdiction of the consumer forum extends to directing the opposite party inter alia to remove the deficiency in the service in question. Intrinsic to the jurisdiction which has been conferred to direct the removal of a deficiency in service is the provision of compensation as a measure of restitution to a flat buyer for the delay which has been occasioned by the developer beyond the period within which possession was to be handed over to the purchaser. Flat purchasers suffer agony and harassment, as a result of the default of the developer. Flat purchasers make legitimate assessments in regard to the future course of their lives based on the flat which has been purchased being available for use and occupation. These legitimate expectations are belied when the developer as in the present case is guilty of a delay of years in the fulfillment of a contractual obligation. To uphold the contention of the developer that the flat buyer is constrained by the terms of the agreed rate irrespective of the nature or extent of delay would result in a miscarriage of justice.”

            “Undoubtedly, as this court held in Dhanda, courts ordinarily would hold parties down to a contractual bargain. Equally the court cannot be oblivious to the one-sided nature of ABAs which are drafted by and to protect the interest of the developer. Parliament consciously designed remedies in the CP Act 1986 to protect consumers. Where, as in the present case, there has been a gross delay in the handing over of possession beyond the contractually stipulated debt, we are clearly of the view that the jurisdiction of the consumer forum to award just and reasonable compensation as an incident of its power to direct the removal of a deficiency in service is not constrained by the terms of a rate which is prescribed in an unfair bargain.”

            These builders are just earning money from the consumers to whom they issued allotment letters and got a huge amount. They keep this amount for a long time and earn interest on it. Property dealing is that part of business where they never pay a penny to the consumers on their amounts deposited for a long-term or if they pay, they pay a meagre interest of about 5% or so but they charge 18 to 24% or more if the consumers default in depositing any instalment. It reminds us the story of “The Merchant of Venice” The Merchant of Venice is the story of a Jewish money lender Shylock who demands that an antisemitic Christian offer “a pound of flesh” as collateral against a loan. These acts of builders also remind us the age of  Sahukari during ancient India and also during British Raj. Whether these builders have power to frame their own law? They put their terms and conditions in such a way that the sufferer will always be the consumer. The Consumer Protection Act 1986 has been enacted for the benefits of consumers,  so the courts dealing with Consumer Protection Act 1986 should come forward for their rescue. The courts are not governed by the builders but they are governed by the law, Custom and Usages. Now in the background of all the facts and also the facts of the present case, we will also discuss something more.

            Now it has been very well established that the opposite party completely failed to deliver the possession of the said flat on 24 September 2014. So in the circumstances they are not entitled to demand any amount which has been mentioned in the Agreement letter . They have not filed the copy of the completion/occupancy certificate and NOC from the various departments as said earlier. Whatever amount is to be deposited by the purchaser of a flat, it should have been clearly mentioned in the allotment letter or builder buyers agreement. Demanding money in various heads on later on cannot be justified. Keeping in view the judgment of the different Hon’ble higher courts we come to the conclusion that the complainant is entitled to the following reliefs are:-

1. We are of the view that the complainants are entitled to get refund of  Rs.375,424/- and Rs.360,000/- from the opposite parties within 30 days from the date of judgment of this appeal with interest at a rate of 10% from the date of respective deposit and if it is not paid within 30 days from the date of this judgment, the rate of interest shall be 15% per annum.
2. We are of the view that the complainants are entitled to get monthly damage according to the area. The area of the said unit is less than 175 m² and keeping in view the judgment of Hon’ble NCDRC in the case of Priyanka Mittal (supra), the opposite parties are jointly and severally directed to pay Rs.15,000/- per month for  12 months and the order shall be complied with, within 30 days from the date of judgment of this appeal otherwise they shall be liable to pay interest at a rate of 15% per annum on this amount.
3. The complainants are entitled to get ₹ 150,000/– in view of Nalin Bhargava Case (supra) as cost But Opposite party has demanded Rs.50,000.00 so he is entitled for this very amount as cost.
4. In the relief clause of the complaint, the complainant has prayed that any other relief as deemed fit and proper in the circumstances of the case may also be granted. So keeping in view all the fraud, unfair trade practice and deficiency in service committed in this case, all the harassment and mental agony given to the allottee’s father, being South Indian, appeared personally for the justice of his son and arguing the case at his own, we find that the complainants are also entitled to get Rs.10 lakhs towards payment of rent of the flat, mental harassment, agony and sufferings.
5. No amount shall be adjusted by the opposite parties to these amounts whatsoever it may be.

The present complaint is decided accordingly.

ORDER

1. The opposite party is directed to refund Rs.375,424/- and Rs.360,000 /- to the complainant within 30 days from the date of judgment of this appeal with interest at a rate of 10% from the date of respective deposit and if it is not paid within 30 days from the date of this judgment, the rate of interest shall be 15% per annum.
2. The opposite parties are jointly and severally directed to pay Rs.15,000/- per month for  12 months and the order shall be complied with, within 30 days from the date of judgment of this appeal otherwise they shall be liable to pay interest at a rate of 15% per annum on this amount.
3. The opposite parties are jointly and severally directed to pay Rs.50,000/– as cost within 30 days from the date of judgment of this appeal otherwise they shall be liable to pay interest at a rate of 15% per annum on this amount. 

4. The opposite parties are jointly and severally directed to pay Rs.10 lakhs towards payment of rent of the flat, mental harassment, agony and suffering.

No amount shall be adjusted by the opposite party to these amounts whatsoever it may be.

All the decreetal amount shall be paid within 30 days from the date of judgment of this appeal, otherwise the opposite parties shall pay interest at a rate of 15% per annum on all the decreetal amount. If it is not paid within 30 days from the date of judgment of this appeal, the complainant shall be entitled to present execution proceedings before this court at the cost of the opposite parties.

The stenographer is requested to upload this order on the Website of this Commission today itself.

Certified copy of this judgment be provided to the parties as per rules.     

         (Vikas Saxena)                           (Rajendra Singh)

              Member                               Presiding Member

Judgment dated/typed signed by us and pronounced in the open court.

Consign to the Record Room.

          (Vikas Saxena)                           (Rajendra Singh)

              Member                               Presiding Member

Dated    03  August, 2022

Jafri, PA II

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