SAMIKSHA BHATTACHARYA, MEMBER
The complainant has filed the instant complaint under Section 17 (1)(a)(i) of the CP Act against OP alleging deficiency in service.
The brief facts of the case, are that the complainant entered into an agreement with the OP on 18.03.2015 for purchasing a flat measuring about 1508 sq. ft. of super built up area with one covered car parking space on the ground floor as per agreement. The complainant paid Rs.11,58,253/- i.e., 20% of total consideration amount. It was agreed by and between the parties that the possession of the completed project would be handed over by 31.03.2017 but upon inspection of the project site it has transferred that any piling work of the project has been completed but no further progress of the work at the site is seen. The complainant asked the OP for final date of delivery of flat which the opposite party failed to provide till date and finding no other way the complainant asked for refund of money so paid to the OP with interest and compensation. Under compelling circumstances, the complainant has been obliged to initiate the present proceeding against the OP for realization of the amount so paid including interest and compensation to the tune of Rs.9,70,000/- only for failure of the OP to keep the assured words otherwise, the very purpose of filing present complaint would be frustrated and the complainant will suffer irreparable loss and injury. The complainant has further submitted that he has not filed in any suit or proceeding on the self same ground and there is no legal impediment in granting the relief as prayed for. Hence, the application praying for direction upon OP to refund the paid amount to the tune of Rs.11,58,253/- along with bank interest, compensation for harassment and litigation expenses amounting to Rs.23,28,263/- and the cost of present proceeding tentatively assessed to Rs.2,00,000/-.
The sole OP appeared before this Commission and filed their written version. In their written version, OP has stated that the complaint is not maintainable in its present form and/or in law. The complainant is not a ‘consumer’ within the meaning of CP Act, 1986 and as such, the instant complaint is not maintainable before the Ld. Commission. The complaint is squarely covered by the arbitration agreement between the parties. Clause XIV of the agreement dated 18.03.2015 provides the arbitration agreement between the parties and the complainant is bound by the same and cannot now seek adjudication of any dispute before this Ld. Commission. The complainant is bad for non-joinder of necessary parties and/or misjoinder of parties. The complaint is hopelessly barred by limitation and has been filed beyond the statutory period of limitation provided under CP Act, 1986. The perceived cause of action for the instant complaint arose first time on 18.03.2015 and the instant petition has been filed in 2018, after inordinate delay of almost three years as such, the complaint is liable to be rejected being hopelessly barred by limitation. Time was the essence of the contract, the parties by their conduct did not adhere to such terms and had given to go-by thereto. Even before expiry of the time period on 31.03.2017, the complainant had cancelled the agreement through email dated 17.05.2016 and sought refund of total amount paid. The complainant by further letter dated 16.08.2016 again requested for cancellation of agreement and refund of total deposited amount. The complainant has not made any payment after the initial deposit of Rs.11,58,253/-. Therefore, the complainant is only entitled to refund of the aforesaid amount as he had already cancelled the agreement on 17.05.2016 in terms of the Clause No. 4.5 of 10.1 of the agreement dated 18.03.2015. In view of the cancellation of the agreement dated 18.03.2015 the complainant cannot demand that the OP perform and fulfils all its obligations under the said agreement and there may be no question of any laches or negligence on the part of the OP. The complainant has approached this Commission with unclean hands and he is guilty of suppression of material facts and making incorrect statements on oath. The project namely, Fort Rejoice was delayed for various reasons and factors which were beyond the control of the OP. There was delay in approval of concept plans and sanctions including necessary terms and approvals from the concerned authorities. This apart there was serious labour disturbance occasioned by political interferences. The unavoidable circumstances resulting from reasons beyond the control which resulted in the delay in the project completion. The OP is in no way responsible for such delay and such delay was beyond the control of the OP. All these resulted in delays are within the knowledge of all concerned including the complainant. In fact, the complainant waived all its perceived rights under the agreement arising out of the perceived default of the OP by agreeing to make payment of instalments upon completion of foundation work at the project. Since the complainant cancelled the agreement in question and sought for refund, the complainant cannot claim to be a consumer and moreover he is only seeking for refund of the amount paid by him before this Commission. He is not praying for delivery of such flat upon full payment, therefore, the complaint is liable to be dismissed in limine.
All the allegations mentioned in the petition of complaint are denied by the OP. Therefore, the OP has stated that the complainant is not entitled to bank interest or compensation or litigation expenses or future interest or compensation alleged at all. Therefore, the OP has prayed for dismissal of the complaint with exemplary cost upon the complainant.
Both sides filed their respective evidence on affidavit, questionnaires and replies.
On the date of hearing, Ld. Counsel for the complainant has stated that it is true that the complainant has paid only 20% of the total price of the flat value along with the car parking space. It is true that the complainant has paid Rs.11,58,253/- which is 20% of the total price of the flat value including car parking space. It was agreed by and between the parties that the possession of the apartment would be handed over by 31.03.2017 but only piling work has been completed then which was revealed on inspection. The OP has not taken any initiative for making construction of the project as assured and ultimately being frustrated the complainant cancelled the agreement and asked for refund together with bank interest and compensation.
In support of his argument, Ld. Advocate for the complainant has cited the judgment passed by the Hon’ble National Commission reported in 2023 1 CPR 35 NC where it has been categorically held –
“Neither possession was offered nor refund was made by the builder. As such there was continuing cause of action and the two year limitation period prescribed in Section 24A (1) was not attracted … “the very fact that the builder was indefinitely retaining the complainant’s deposited amount was in itself sufficient cause to justifiably condone the delay under Section 24A(2), anything otherwise would have been tantamount to a travesty of justice, leaving the complainant helpless and remediless – therefore, the complaint is not barred by limitation and with the request to decide the complaint on merit as per law.”
In course of argument, Ld. Counsel for the OP has stated that the complainant by a letter dated 16.08.2015 (page 37 of the complaint) admitted that he had stopped the payment of second instalment as he was of the opinion that the construction is not progressing. As on date the project is ongoing and the complainant has not appointed any engineer commissioner to establish that the project is not going on. On 17.05.2016 the complainant cancelled the agreement and demanded refund of money which he paid. The project started as per schedule, however, purchasers as like complainant failed to make timely payment of the consideration the project got delayed. Since the complainant cancelled the agreement by letter dated 17.05.2016 the the consumer relation ceased to exist for which the complainant cannot come before this Commission. The complainant has filed present complaint only for refund of certain amount which according to him is refundable as he had cancelled the agreement dated 18.03.2015. Since the only prayer is refund of certain amount with interest the present legal proceeding is actually a money suit which ought to be decided by a competent Civil Court and not by this Commission. The complainant in writing has agreed to refer any dispute to arbitration and as the money demand is not a consumer dispute, the complainant ought to have initiated arbitration proceeding as per Clause 14.1 of the agreement dated 18.03.2015. In support of his argument, the Ld. Counsel for the OP has cited the judgment passed by the Hon’ble High Court at Calcutta in Rita Das vs. Jayashree Ghosh where the Hon’ble Court has held –
“Thus in view of the specific embargo created under the Special Act, the Consumer Forum or the State Commission was not competent to pass the order and/or entertain the said completion:”
It is therefore, submitted by OP that the present complaint be dismissed with heavy cost.
Upon hearing the parties and on perusal of entire materials on record, it is admitted fact that the complainant and OP entered into an agreement on 18.03.2015 for purchasing of a flat measuring 1503 sq. ft. super built up area for a consideration of Rs.56,17,680/-. It is also admitted fact that the complainant paid Rs.11,58,253/-. Two money receipts, issued by OP, have been annexed with the petition of complaint towards payment of Rs.2.06,180/- dated 22.10.2014 and Rs.9,52,073/- dated 14.02.2014.
As per agreement, the schedule date of delivery of possession was 31.03.2017. The developer shall over be entitled to an extension of six months from such completion date in which case the extended date shall then be taken as the completion date.
(Clause No. 5.4 of agreement dated 18.03.2015). It is also admitted fact that the complainant requested for cancellation of the agreement and prayed for refund of deposited amount of Rs.11,58,253/- vide letter dated 17.05.2016 which is annexed as page No. 6 with the petition of complaint. When the Ld. Counsel for OP was asked what is the position of the project at present he could not answer in positive that the project has been completed. The argument on behalf of the Ld. Counsel for the OP that since the complainant has failed to pay second instalment onwards then the project got delayed, but the OP has failed to produce any single scrap of paper which suggests that due to the reason for non-payment on the part of the complainant, the project got delayed.
The another contention of the OP that they have not completed the project in time due to delay in approval of Concept plan and to take necessary permissions and approvals from the concerned authorities. The OP has also submitted in its written version, that there was serious labour disturbances occasioned by the political interferences. But the OP has filed to produce any such document towards their contentions.
Moreover, what measures they have taken to take the necessary permission and so on, no cogent document is come with the written version. Moreover, due to labour disturbances, they have not filed any complaint to the concerned authority. Therefore, the argument on behalf of the OP on this point cannot be accepted in the eye of law.
The OP has argued that there is Clause No. 14.1 that all disputes and differences between the parties regarding the construction construction or interpretation of any of the terms and conditions contained in the agreement for sale or touching these presents or determination of any liability shall be referred to the arbitration in accordance with the provisions of the Arbitration and Conciliation Act, 1996 or any other modifications or enactment thereto for the time being in force. There are plethora of judgments that if there is existence of any arbitration clause, it would be the choice of the complainant where he will approach. In support of this, we can rely upon the judgments passed by the Hon’ble Supreme Court in –
- Emaar MGF Land Ltd. vs. Aftab Singh (2019)
- Booz Allen & Hamilton Inc. vs. SBI Home Finance Ltd. reported in (2011) 5 SCC 532
- National Seeds Corporation Ltd. vs. M. Madhusudhan Reddy (2012) 2 SCC 506
- Sky pac Curriers vs. Tata Chemicals Ltd. reported in (2009) 5 SCC 294.
Moreover, as per section 3 of Consumer Protection Act, 1986, the Consumer Protection Act makes it clear that the remedy available in the Act is in addition to and not in derogation of the provision of any other law for the time being in force.
The another point for consideration is that whether the complainant can approach this Commission after requesting for cancellation of the agreement and can pay for refund of the deposited amount. Now the question is the complainant has paid the booking amount as per agreement. Thereafter, the OP has failed to perform their job. At the time of the delivery of the possession of the flat and car parking space, the complainant has noticed that on piling work has been completed. Finding no other alternative, the complainant has prayed for cancellation of the agreement and praying for refund of the deposited amount. Therefore, in case of the failure on the part of the OP, the complainant has no other option but to opt for cancellation of the agreement. There is no dispute that the complainant has paid Rs.11,58,253/-. The OP has admitted that the OP has received that amount of money for so many years for performing their jobs on their part but ultimately OP failed. Now the Ld. Advocate for the OP has argued that the petition of complaint has been filed for refund not for direction upon the OP to handover the flat and car parking space. Astonishingly, at the time of argument also not submittedthat the projectis completed in all aspects and the company is ready to deliver the case flat and car parking space to the complainant. It is admitted fact that neither the possession was offered nor refund was made by the builder. Therefore, the OP is liable to refund the amount to the complainant since the amount was retained by the builder for so many years. Since neither the possession was given nor the refund was made by the builder there isalso continuing cause of action and the two yeas limitation period prescribed in Section 24A is not attracted.
Now the question is whether the complainant is entitled to compensation. The complainant entered into the agreement for sale in the year 2015, now it is 2023. Almost eight years have been elapsed but the OP has failed to show the whereabouts of the project. So it is palpably clear that the OP has failed to complete the project.
The argument on behalf of the OP that they had not completed the project since the complainant has not paid the amount after paying the booking amount. If this is so, then the OP had to send letter that due to non-payment on the part of the complainant/purchaser, the agreement would be terminated. But the complainant fails to pay the amount as per schedule then what prevented the OP to complete the project in scheduled time. In the instant case not only the delay occurred, till date the OP has failed to show that the project has been completed with a delay.
As per Clause No.5.5 of the Agreement for Sale dated 18.03.2015, the completion date i.e. 31.03.2017 shall be stand extended by such period for which the developer/seller become unable to fulfill their obligations, to complete the said building within the stipulated time, for reasons of Force Majeure and/or beyond their control. In the instant case, no such document towards Force Majeure clause has been filed by the OP.
The Clause No. 5.10 of the Agreement for Sale is reproduced as under:
In case of delay in handing over the possession within the stipulated period or such extended period as provided in these presents, the developer/seller shall be liable to pay such damages as provided in the West Bengal Building (Regulation of Promotion of Construction and Transfer by Promoters) Act 1993 (W.B. Act XX of 1993) subject to such delay not being caused by prevention of Force Majeure or such circumstances which would be beyond the control of the developer/seller.
In the instant case, no such document towards Force Majeure clause has been filed by the OP.
As per above discussion, it is admitted portion that builder is indefinitely retaining the complainant’s deposited amount without showing any cogent reason. A purchaser with a dream for a home cannot wait for an inordinate delay. Finding no other alternative, complainant has opted for cancellation of the agreement and since the amount was not refunded by the OP the complainant is entitled with compensation also since there is gross negligence and deficiency in service on the part of the OP.
We are of the view that the complainant is entitled to get interest for his deposited amount in the form of compensation.
Accordingly, the complaint case succeeds.
Hence,
it is
O R D E R E D
The complaint case be and the same is allowed on contest against the OP with cost.
OP is directed to refund Rs.11,58,253/- (Rupees Eleven lakh fifty-eight thousand two hundred fifty-three) only along with interest @ 8% p.a. from the date of payment till its realization in the form of compensation within 60 (sixty) days from the date of passing this order.
The OP is also directed to pay litigation cost of Rs.20,000/-(Rupees twenty thousand) to the complainant within the aforementioned stipulated period.
If the OP fails to comply with the order within the stipulated period the complainant is at liberty to put the decree into execution.
The complaint case is, thus, disposed of accordingly.