DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAHIBZADA AJIT SINGH NAGAR (MOHALI)

                                  Consumer Complaint No.591 of 2015

                                                Date of institution:  02.11.2015                                         Date of decision   :  12.09.2016

Ram Pal son of Shri Deep Chand resident of House No.338, Ward No.12, Village and Post Office Siwah, District Panipat.

                                  ……..Complainant

                                        Versus

Greater Mohali Area Development Authority, PUDA Bhawan, Sector 62, SAS Nagar through its Administrator.

                                                              ………. Opposite Party

Complaint under Sections 12 to 14

of the Consumer Protection Act

Quorum

Shri Ajit Pal Singh Rajput, President                          Shri Amrinder Singh Sidhu, Member.

Mrs. R.K. Aulakh, Member.

Present:    Shri Rajbir Singh, counsel for the complainant.

                Shri Anuj Kohli. counsel for the OP.

ORDER

By Ajit Pal Singh Rajput, President

                Complainant, Ram Pal son of Shri Deep Chand resident of House No.338, Ward No.12, Village and Post Office Siwah, District Panipat, has filed this complaint against the Opposite Party (hereinafter referred to as the OP) under Sections 12 to 14 of the Consumer Protection Act. The brief facts of the complaint are as under:

2.             The complainant had applied for residential apartment Type-2 in Purab Apartments in General Category at Sector-88, SAS Nagar.  The complainant was successful in the draw of lots and accordingly Letter of Intent (LOI) dated 21.05.2012 was issued by the OP. As per Clause 3 (II) of the Letter of Intent, the possession of the apartment was to be handed over after completion of development works within a period of 36 months from the date of issuance of LOI and if the OP was unable to deliver the possession within the stipulated period, the allottee shall have the right to withdraw from the scheme by moving an application and the entire deposited amount would be refunded to the allottee alongwith 8% interest compounded annually.  The complainant thereafter deposited Rs.11,00,000/-, Rs.9,00,000/- on 20.05.2013 and Rs.7,50,000/- on 25.11.2014. Then on the failure of the OP to comply with the conditions of the LOI, the complainant vide application dated 24.05.2015 requested for refund of the deposited amount. This application of the complainant was accepted by the Chief Administrator of the OP vide order dated 23.06.2015 and cheque of Rs.25,89,525/- was issued vide letter dated 25.08.2015.  The complainant had deposited a total amount of Rs.33,00,000/- against Rs.55,00,000/- the value of the flat. However, at the time of refund, the OP has deducted an amount of Rs. 6,93,480/- and also Rs.16,995/- on account of service tax. As per the complainant the OP is liable to pay 8% compound interest annually on the deposited amount as per Clause 3 (ii) of LOI.  The OP has illegally deducted an amount of Rs.6,93,480/- and Rs.16,995/- at the time of refund to the complainant. The complainant is entitled to 18% interest on the total deposited amount and also refund of the aforesaid amounts. Hence this complaint for giving directions to the OP to refund the amount of Rs.6,93,480/- and Rs.16,995/- alongwith interest @ 18% per annum on the total deposited amount; compensation of Rs.1,00,000/- for physical strain and mental agony and Rs.22,000/- as costs.

3.             The complaint is contested by the OP by filing reply, in which it had raised certain preliminary objections, inter alia, that there is no deficiency in service and unfair trade practice on its part; the refund was made to the complainant as per terms and conditions of letter of intent which has been accepted by the complainant without any protest; the complainant is not consumer of the OP as he had purchased the flat for speculation purpose and not for self residence purpose. On merits, the OP has pleaded that the complainant has defaulted in complying with the terms and conditions of LOI.  The amount has been refunded to the complainant in terms of Clause 2.3 (II) of conditions of LOI. The OP has denied that it is liable to pay 8% compound interest annually as per Clause 3 (ii) of LOI or that any act of the OP is against law or comes under deficiency in service. As the complainant has not adhered to the payment schedule as per Para 2.2 of the LOI,  he is not entitled to claim benefit of Clause 3 (II) of LOI. The service tax is paid to the State Government and the complainant is liable to pay the same. As the complainant has defaulted in making payment of installments on or before the due dates, he was served with show cause dated 05.11.23014 and in response thereto the complainant vide his representation dated 27.11.2014 intimated that he could not pay the installments in time due to his family circumstances. He only deposited Rs.7,50,000/- against four installments which were due upto 21.11.2014. Another demand notice dated 03.03.2015 was sent to the complainant to deposit the outstanding amount of Rs.29,04,140/- towards installments and penalty. The complainant was informed that on failure of deposit of the payment in time, action for cancellation of LOI and refund of amount will be taken. As per condition No.2 of the brochure, in case LOI is surrendered after 30 days of its issuance, the amount be refunded after 10% deduction. The complainant surrendered the LOI on 25.05.2015 and accordingly the amount has been refunded to him after deduction of 10%.  Though the complainant was given the right to withdraw from the  scheme in case the OP was unable to deliver the possession of apartment within stipulated period of 36 months from issuance of LOI, but such a right could be availed only if he had fulfilled his part of contract by making payment of the balance outstanding amount. The OP has thus prayed for dismissal of the complaint.

4.             In order to prove the case, the complainant tendered in evidence his affidavit Ex. CW-1/1; copies of letter of the OP Ex.C-1; cheque Ex.C-2; letter Ex.C-3; LOI Ex.C-4; receipts Ex.C-5 to C-7; no due certificate Ex.C-8 and letter Ex.C-9. In rebuttal the OP tendered in evidence affidavit of Mahesh Bansal, Estate Officer Ex.OP-1/1; LOI Ex.OP-1; show cause notice Ex.OP-2 and demand notice Ex.OP-3.

5.             Learned counsel for the complainant has argued that  against Rs.55,00,000/- which is the total value of the flat, the complainant had paid Rs.33,00,000/-. As the OP has failed to comply with the terms of LOI, the complainant vide his application dated 24.05.2015 had requested for refund of the deposited amount.  However, the OP at the time of refund, instead of paying 8% interest on the deposited amount, had made refund of Rs.24,89,525/- thereby deducting Rs.6,93,480/- being10% penalty and Rs.16,995/- as service tax.  As per the complainant deduction of aforesaid amounts is illegal and is not as per terms of the LOI and is deficiency in service and unfair trade practice on the part of the OP.

6.             On the other hand, learned counsel for the OP has contended that the complainant has committed default in making payment of installments as per terms of Letter of Intent dated 21.05.2012.  The amount has rightly been refunded to him as per terms of the LOI.  Learned counsel for the OP has relied upon the decision of Hon’ble Punjab and Haryana High Court, Chandigarh in CWP No.16153 of 2014 titled as Rajiv Arora Vs. State of Punjab and others, decided on 21.07.2015 wherein it has been held that “as the petitioner failed to deposit balance outstanding amount in compliance with terms and conditions laid down in Clause 2, he cannot be heard to say that he is entitled to invoke Clause 3 (II). The allottee in, no circumstance, can take advantage of Clause 3 (II) unless he has complied with schedule of payment and waited for a period of 36 months from the date of issuance of LOI for delivery of possession of the flat.

7.             We have gone through the pleadings, evidence and written arguments of the parties and heard the oral submissions, addressed by the learned counsel for the parties. In the present case, against the total value of the flat of Rs.55,00,000/- the complainant had paid Rs.33,00,000/- and did not pay installments on the due dates. The OP had issued him show cause notice dated 05.11.2014(Ex.OP-2) for making payment of the installments due upto 21.11.2014 but instead of making payment, the complainant vide request dated 27.11.2014 requested for refund of the amount. The OP again vide letter dated 03.03.2015 (Ex.OP-3) asked to the complainant to make the outstanding payment of Rs.29,04,140/- but inspite of that the complainant failed to make the payment. In our opinion, the present case is covered by the judgment of Hon’ble Punjab & Haryana, in case titled as Rajiv Arora Vs. State of Punjab and others,(Supra). The present case is also having similar facts and circumstance.

8.             Accordingly, in view of our aforesaid discussion and the case law citied by the learned counsel for OP, we find that the OP in terms of LOI, rightly made refund to the complainant. Hence the present complaint is hereby dismissed. Parties to bear the cost. 

                The arguments on the complaint were heard on 05.09.2016 and the order was reserved. Now the order be communicated to the parties. Copy of the order be sent to the parties free of cost and thereafter the file be consigned to the record room.

Pronounced

Dated: 12.09.2016    

                                         (A.P.S.Rajput)           

President

  (Amrinder Singh Sidhu)

                  Member

(Mrs. R.K. Aulakh)

Member