For the Appellant          : Mr. Arun Kumar Mishra, Advocate

                                      : Dr. Abhishek Atrey, Advocate

                                      : Dr. H.B. Mishra, Advocate

                                      : Mr. Sandeep Bisht, Advocate

                                      : Mr. Apratim Animesh Thakur, Advocate

                                      : Mr. Amrit Koul, Advocate

                                      : Mr. Bikas Mohanti, Advocate

                                      : Mr. Shashwat Prateek Panda, Advocate

                                      : Mr. Rajiv Pathak, In person

                                      : Mr. Sunil Murti Anchal, In person

                                      : Ms. Prama Chopra, In person

For GTM Builders         : Mr. Aditya Narain, Advocate

                                      : Mr. Rahul Malhotra, Advocate

                                      : Mr. Fanish Rai, Advocate

                                      : Ms. Pallavi Tayal, Advocate

                                      : Mr. Gaurav Sahdev, Advocate

                                      : Mr. Raj Shekhar, Advocate

                                      : Mr. Ashikesh Gupta, Advocate

                                      : Ms. Himanshi Madaan, Advocate

1.      Heard Mr. Arun Kumar Mishra, other Advocates and the buyers (In person), for the buyers and Mr. Aditya Narain, and Mr. Rahul Malhotra, Advocates, for GTM Builders & Promoters, in the appeals.

2.      Some of the appeals are reported as time barred. The appellants have filed delay condonation application, giving cause for delay. Delay in filing the appeal is condoned. All such appeals are treated as filed within time. Some details of the appeals are given below:-

3.      The home buyers have filed some of the appeals from the orders of State Consumer Disputes Redressal Commission, Delhi, dated 02.04.2013, 29.10.2013 and 01.08.2016 passed in their consumer complaints, alleging deficiency in service committed by GTM Builders & Promoters Pvt. Ltd. (the builder), in delaying possession of their flats, not allowing delayed compensation and illegally charging money in different heads, in Tower No.11, GTM Residency Tower, Valley View Estate, Gwal Pahadi, Gurgaon. The builder has also filed various appeals, from the above orders, granting some relief to the home buyers. In all these appeals, common issues of law and fact are involved, as such, these appeals have been consolidated and heard together and are being decided by a common order. For appreciating controversy, the facts of CC/149/2011 (FA/27/2014 & FA/38/2014) are given in this judgment. The necessary facts of these complaint/appeals are given in the table above.

4.      Arun Kumar Mishra (the complainant) has filed FA/27/2014 from the order of State Consumer Disputes Redressal Commission, Delhi, dated 29.10.2013, passed in CC/149/2011, partly allowing the complaint and directing GTM Builders & Promoters Pvt. Ltd. (opposite party-1) to handover possession of Apartment No.302, Tower No.11, GTM Residency Tower, Valley View Estate, Gwal Pahadi, Gurgaon, within 15 days from the date of payment of the amount demanded vide letter dated 19.07.2011, without interest, except escalation charges of the material and labour. GTM Builders & Promoters Pvt. Ltd. (the opposite party) has filed FA/38/2014 from the order of State Consumer Disputes Redressal Commission, Delhi, dated 29.10.2013, passed in CC/149/2011, directing the builder not to charge interest mentioned in the demand letter and escalation charges for the materials and labour.

5.      Arun Kumar Mishra filed CC/149/2011, for directing GTM Builders & Promoters Pvt. Ltd. and others (the builder) (i) to handover possession of Apartment No.302, Tower No.11, GTM Residency Tower, Valley View Estate, Gwal Pahadi, Gurgaon, complete in all respect, immediately, (ii) to pay delayed compensation @ Rs.5/- per sq.ft. per month, from 11.06.2007 till the date of possession along with interest @18% per annum, (iii) to pay Rs.25000/- per month from June, 2007 till the date of possession, for loss suffered by the complainant, (iv) to pay interest @24% per annum on the deposit of the complainant, (v) to pay Rs.5/- lacs, for mental agony and harassment, (vi) to pay Rs.50000/-, as the cost of litigation; and (vii) any other relief, which is deemed fit and proper in the facts and circumstances of the case.

6.      The complainant stated that GTM Builders & Promoters Pvt. Ltd. (the builder) was a company, registered under Companies Act, 1956 and engaged in the business of developing and constructing group housing projects. Other opposite parties were its directors/officers. The builder launched a group housing project in the name of “GTM Residency Tower”, Valley View Estate, Gwal Pahadi, Gurgaon, made wide publicity in November, 2004 and gave a pre-launch offer @Rs.1500/- per sq.ft. till 30.11.2004. Allured with lucrative representation and believing on it, the complainant booked a flat and deposited the required money of Rs.440775/- on 28.11.2004. The builder provisionally allotted Flat No.-302 (super area 2530 sq.ft. saleable area 1959 sq.ft., basic sale price of Rs.2938500/- inclusive one covered car parking space, membership of Community Centre-cum-Club, 7.5 KVA Power Backup). Under the booking form, the builder promised to deliver possession within 36 months from the date of the agreement, which was executed on 12.12.2004 between the parties. The builder, vide letter dated 12.12.2004 (page-118), made a commitment for payment of compensation at the rate of Rs.5/- per sq.ft. per month, if possession is delayed after due date. As per demand, the complainant deposited Rs.43850/- on 27.12.2004, Rs.100000/- on 27.12.2004, Rs.100000/- on 27.12.2004, Rs.293850/- on 25.02.2005, Rs.293850/- on 25.02.2005 and Rs.1469250/- on 29.06.2005 (total Rs.2791575/-). The complainant took loan IDBI Bank to deposit the amount of Rs.1469250/-, for which a tripartite agreement dated 28.05.2005 was executed between the parties. The builder informed that excavation work was started on 07.02.2005. Due date for possession expired on 12.06.2007. The complainant used to write letters time to time, inquiring about completion of construction and delivery of possession then some information that the construction was going on with full swing etc. were given. The complainant, vide letter dated 14.06.2008, demanded compensation for delay in possession. The builder vide letter dated 17.09.2008, informed that main construction of the tower was completed, however some interior works, wood works etc. remained to be completed. The builder issued a demand letter dated 04.10.2010, demanding Rs.215000/- towards 7.5 K.V.A. Power Backup, Cost of dual electrification, Administrative charges and External Electrification Charges. The complainant vide letter dated 07.10.2010, replied that the compensation for the period of delay would be Rs.518691/- as such, demand would be adjusted from it. The builder arranged for a meeting on 23.10.2010, in which, the complainant satisfied that 95% of sale consideration was paid up to 29.06.2005 and the complainant was entitled for delayed compensation from 12.06.2007, which was not paid by the builder. But the builder again sent a demand letter dated 10.11.2010, demanding External Electrification Charges, which was objected vide letter dated 19.11.2010. The builder vide letter dated 16.12.2010, demanded the papers/photo etc. for documentation purposes, which was supplied on 25.12.2010. The builder, vide letter dated 28.01.2011, informed that they would be able to offer fit-out possession from March, 2011. The builder, vide letter dated 27.04.2011, offered “Fit-out Possession” and asked to complete formalities for taking possession. The complainant, vide email dated 29.04.2011, inquired from customer care office of the builder about the stage of “Occupancy Certificate” and compensation for delayed possession but no reply was given. On the allegation that the complainant paid 95% of sale price of the flat up to 29.06.2005, due date of possession as per the agreement, expired on 12.06.2007 but the builder did not give any information regarding “Occupancy Certificate” nor paid compensation for delay and thus committed deficiency in service, the complaint was filed on 26.05.2011.       

7.      The opposite parties filed their joint written statement in the complaint, in which, material facts relating booking/allotment of the flat and payments made by the complainant, including money advanced by IDBI Bank have not been disputed. The builder took plea that the complaint has become infructuous as the builder, through letter dated 19.07.2011, raised a demand of Rs.1695480/- on account of increase of additional area, incidental expenses, External Electrification Charges etc. requiring to deposit the amount within 15 days of service of the notice and in case of default, the allotment would stand cancelled, in terms of clauses-6 & 8 of the Agreement. In spite of service of the letter, the complainant did not deposit the amount within 15 days as such, the allotment stands cancelled. The complainant did not challenge the letter dated 19.07.2011 in the complaint as such the complaint has become infructuous as after cancellation of allotment, relationship between the buyer and builder has come to an end. On merit, it has been stated that due date of possession was tentative. Vide Clause-23 of the Application Form and Clause-14 of the Agreement, the builder was entitled for extension of period for which the construction was delayed due to force majeure reasons, specifically provided therein. After buying FAR from Ansal Properties & Industries Ltd., the builder found a big rock underneath. The builder took time in obtaining consent of Ansal Properties & Industries Ltd. and BSF Co-operative Housing & Building Society for its removal and removing the rock from the site. The builder gave the contract for construction of the project to M/s. Sneh Developers Pvt. Ltd., vide an agreement dated 10.03.2005,  under which, construction of the project had to be completed up to 31.10.2006. Finding that the construction was not progressed on the spot to the extent of reasonable expectation, the builder gave a notice dated 31.07.2006 to M/s. Sneh Developers Pvt. Ltd. that construction was being delayed and was not likely to be completed on due date. M/s. Sneh Developers Pvt. Ltd. admitted that they would not be able to complete the construction on time. It was thought that engaging new contractor at that stage would further delayed construction, the period for construction was extended up to 30.09.2007 by supplementary agreement dated 28.09.2006. M/s. Sneh Developers Pvt. Ltd. again committed default and gave an undertaking on 31.08.2007 to complete construction up to 31.05.2008. The builder was not satisfied with the undertaking and terminated contract of M/s. Sneh Developers Pvt. Ltd. on 05.03.2008. M/s. Sneh Developers Pvt. Ltd. again assured to complete the construction within reasonable period, then period of construction was extended up to 30.09.2008 vide letter of intent dated 25.03.2008. However, M/s. Sneh Developers, despite receiving Rs.10.10 crores out of total Rs.14/- crores of contract money could not complete the construction, as such its contract was cancelled on 29.08.2008. For completion of remaining work, the builder gave contract to M/s. S.S. Associates on 28.01.2009 and paid additional amount of Rs.1.7 crore, to new contractor. M/s. Sneh Developers did not permit the new contractor to work. Thereafter, the builder took over the project and completed construction till April, 2011. The builder incurred Rs.10.00 crores more due to escalation charges for cost of materials and labour. The home buyers agreed to give escalation charges vide Clause-17 of the Application Form. Final construction area was increased. The home buyer agreed to pay cost of increased area vide clause-12 of the Agreement. The home buyers agreed to pay statutory taxes vide Clause-16 of the Agreement. Service tax was assessed at the rate of 10.30% w.e.f. 24.02.2009 as such additional demand of Service tax was raised. Internal Development Charges are charged for construction of internal road, water bodies, parks etc. All the demands in letter dated 19.07.2011 were genuine. In order to avoid legitimate payment, this complaint has been malafide filed. They denied of committing deficiency in service and unfair trade practice. The complaint was barred by limitation.

8.      The complainant filed Rejoinder Reply, in which the facts stated in the complaint have been reiterated. The complainant stated that he had paid 98.4% of total price and remaining amount was payable at the time of offer of possession. Allotment could not be cancelled for not depositing additional demand although by that time, the construction was neither completed nor the flat was in habitable condition. After receiving letter dated 19.07.2011, the complainant vide letter dated 23.07.2011, demanded a signed copy of Statement of Account and to inform the exact date of delivery of possession but the builder did not respond. The builder applied for “Occupation Certificate” through Ansal Properties & Industries Ltd. on 03.10.2011, which has not been issued so far. Prior to issue of “Occupation Certificate” there was no occasion for the builder to raise any demand or cancel allotment, after filing the complaint. Existence of rock on the site and its removal and consequent delay have been denied. The dispute between the builder and its contractor is not a force majeure reason. At no point of time, the builder informed about increase of cost of materials and labour, demand in the head of escalation of charges was illegal. Under Circular dated 29.01.2009, the service tax is not payable in the present contract. Demand of service tax was illegal.

9.      The complainant filed Affidavit of Evidence of Arun Kumar Mishra and various documents. The builder filed Affidavit of Evidence of Rajesh Kumar, Manager (Legal) and various documents. Both the parties filed their written submission. State Commission, by impugned judgment dated 29.10.2013, held that the builder was entitled for extension of time, for period, for which the construction was stopped due to the dispute between the builder and M/s. Sneh Developer Pvt. Ltd. In spite of accepting 95% of sale consideration, the builder was not justified in cancelling the allotment. Demand of escalation charges and interest was illegal. On these findings, the complaint was partly allowed and the order as mentioned above has been passed. Hence the complainant filed FA/27/2014 and the builder filed FA/38/2014.

10.    In order to decide the issue in respect of increased area of the flats, this Commission appointed Mr. R.K. Kakkar, (Retd.) Chief Architect, CPWD, as Local Commissioner and directed to measure the construction on the spot, who after measurement submitted his report dated 13.01.2014. None of the parties filed any objection against this report, which was confirmed. This Commission, vide order dated 06.08.2014, issued following directions:- (i) Since all the flats have been physically measured by the Local Commission with reference to the plans supplied by the Promoter, the additional amount, if any, payable by each of the allottees before us, shall be re-computed as per the actual measurements by the Local Commissioner and recorded under Sitaution-3 in his Report dated 13.1.2014. If the area of a flat falls short of the area of the flat mentioned in the agreement, excess amount paid by the allottee towards the cost of the flat shall be credited to his account for adjustment against other charges being claimed by the Promoter from the allottees and are subject matter of dispute in these appeals. Subject to further orders, the allottees shall not be liable to pay any further amount in respect of the flats in question. However, in case, there is any shortfall in the payment by an allottee in respect of his flat as per the fresh calculations, the possession of the flat shall be delivered to him only on payment of the balance amount. (2) Where the allottees have not paid any additional amount as was directed in some of the cases and if on fresh calculations in terms of this order no additional amount towards the cost of the flat is payable, the possession of the flat shall be delivered to them within 6 weeks from the date of receipt of a copy of this order. (3)  The Promoter shall remove the objections stated to have been raised by the Authorities concerned in their application for issue of Occupancy Certificate within four weeks from today. In case, there is any impediment in obtaining the said certificate, it will be open to the Promoter to seek appropriate orders from this Commission. (4) On receipt of Occupancy Certificate, the Promoter shall inform/send due intimations in this behalf to all the allottees to enable them to purchase requisite Stamp Papers for execution of the Sale Deeds on a mutually agreed date and time, which, in any event, shall not be later than four weeks from the date of receipt of Occupancy Certificate.

11.    This Commission, vide order dated 07.11.2014 (as corrected on 09.01.2015), directed the builder to handover possession of the flats to the home buyers, in habitable condition as per specification, leaving all the questions open to be decided and the home buyers were directed to deposit some amounts. Again dispute arose for delivery/taking of possession on the spot, alleging deficiency in construction. This Commission, vide order dated 01.04.2016, directed for delivery of possession in presence of Mr. R.K. Kakkar, Retd. Chief Architect, CPWD, the Local Commissioner on 02.05.2016. The home buyers raised objection in respect of deficiency in construction at the time of possession. Local Commissioner noted it and submitted report dated 08.05.2016, pointing out various deficiencies in construction. This Commission, vide order dated 25.05.2016, directed the builder to remove the defects within six weeks in supervision of Local Commissioner. After repairs, Local Commissioner submitted his report dated 26.07.2016. After perusal of the report dated 26.07.2016, this Commission framed following issues for consideration in the appeals:-

(i) Whether the flats in question suffered from the alleged defects, as also non-fulfilment of other stipulation in the Agreement to Sell, including the execution of the conveyance deeds in respect thereof, amounts to deficiency in service, on the part of the Respondent/Developer and if so, whether the complainants are entitled to any compensation on that account?

(ii) Whether there was delay in the delivery of possession of the flats in question to the complainants and if so, what compensation the complainants are entitled to? And

(iii) Whether the complainants are liable to pay any additional amount, as being demanded by the developer?      

12.    I have considered the arguments of the counsel for the parties and examined the record. The counsel for the builder raised preliminary objection that some of the complainants did not challenge the letter dated 19.07.2011 in their complaints as such those complaints were not maintainable or if filed prior to letter dated 19.07.2011, had become infructuous, as after cancellation of allotment, relationship between the buyer and builder had come to an end. He submitted that the relief which was not prayed for in the complaint, cannot be granted as held by Supreme Court in Manoharlal Vs. Ugrasen, (2010) 11 SCC 557 and General Motors Vs. Ashok Ramniklal Tolat, (2015) 1 SCC 429.

This argument is not liable to be accepted. Rules of pleading as provided under Civil Procedure Code, 1908 have not been applied to the proceeding before consumer fora. The consumer fora have to decide all the issues raised by the parties, on the basis of evidence on record. If the consumer fora find that there was deficiency in service or unfair trade practice, it is well within its jurisdiction to grant appropriate relief. Supreme Court in IREO Grace Realtech Pvt. Ltd. Vs. Abhishek Khanna, (2021) 3 SCC 241, held that Section 14 of Consumer Protection Act, 1986, empowers the consumer fora to redress the deficiency of service by issuing appropriate direction to the builder. Pasupuleti Venkateswarlu Vs. The Motor & General Traders, AIR 1975 SC 409, Orissa Cement Limited Vs. State of Orissa, 1991 Supple (1) SCC 430 and Om Prakash Gupta Vs. Ranbir B. Goyal, (2002) 2 SCC 256, held that the court/tribunal can mould the relief, in view of subsequent facts.

13.    Letter dated 19.07.2011 reads as “you are therefore requested to submit your confirmation with regard to the payment of the aforesaid additional demand within 15 days from the date of receipt of this letter, failing which, the booking done by your good self shall be deemed as cancelled and company will be left with no option but to return the payment received with 10% per annum interest in another 3 months after expiry of 15 days.”

Arun Kumar Mishra, vide letter dated 23.07.2011, demanded signed copy of statement of account. Neither statement of account was supplied nor money along with interest, deposited by the home buyer was refunded within 3 months, as stated in the letter. So long as the money of the home buyer is withheld by the builder, their relationship will not come to an end and the contract between them is not discharged. In some of the complaints, legality of letter dated 19.07.2011 has been challenged. The builder is relying upon letter dated 19.07.2011, in its defence in all the complaints. In some of the cases, demand made vide letter dated 19.07.2011, was modified by the builder later on. Legality of the demand letter dated 19.07.2011 or other demand letter is very much in issue in all these complaints. It is not only desirable but obligatory for Consumer Commission to decide this issue of additional demand in all the complaints. If demand letter is found unreasonable and amounts to unfair trade practice, the Commission can mould the relief and pass appropriate order in all the cases. Preliminary objection has no merit.

14.    So far as the first issue framed above, is concerned, this Commission, vide order dated 25.05.2016, directed the builder to remove the defects within six weeks in supervision of Local Commissioner. After repairs, Local Commissioner submitted his report dated 26.07.2016, mentioning that defects in construction were substantially removed. None of the home buyers raised any argument on this issue at the time of hearing. The home buyers are residing in their flats since 2016. They will take care of normal wear and tear.

15.    So far as second issue framed above is concerned, vide clause-13 of the agreement dated 12.12.2004, possession was likely to be delivered within 30 months from the date of agreement. Due date of possession was 12.06.2007. The builder took plea the possession was offered on 27.04.2011. The builder, vide letter dated 19.07.2011, raised additional demands. This letter does not talk about completion of construction/possession. The possession was handed over to some of the home buyers in the year 2014 while some of them took possession under the orders of this Commission on 02.05.2016. As such there is delay in delivery of possession. The builder, relying upon clause-23 of Application Form and clause-14 of the agreement, claims for extension of time (i) which was taken in removal of the rocks from the site and (ii) the period for which the construction was delayed by the contractor M/s. Sneh Developers Pvt. Ltd.

 16.   Force Majeure is a clause that is included in contract to save from the liability for unforeseen and unavoidable catastrophic that interrupt. Force Majeure has been statutorily recognised under Section 56 of the Contract Act, 1872. Supreme Court in Dhanrajmal Govindram Vs. Shyamji Kalidas, AIR 1961 SC 1285, held that an analysis of the rulings on the subject shows that where reference is made to “force majeure” the intention is to save the performing party from the consequences of anything over which he had no control. In IREO Grace Realtech Pvt. Ltd. Vs. Abhishek Khanna, (2021) 3 SCC 241, the period of delay caused in issuing NOC by Fire Department, was excluded from counting the period of delay. The counsel for the home buyers relied upon judgment of Supreme Court in Energy Watchdog Vs. CERC and other, (2017) 14 SCC 80, in which the force majeure clauses were not made part of the agreement. They also relied upon judgment of Delhi High Court in Halliburton Offshore Service Inc. Vs. Vedanta Ltd., 2020 SCC OnLine Del 2068, in which, ‘epidemic or plague’ were specifically excluded from force majeure clause of the contract, as such, these judgements are distinguishable. The judgments of this Commission in RP/2443/2013 GTM Builder & Promoters Pvt. Ltd. Vs. M.C. Goel (decided on 20.04.2015) and Supreme Court in SLP (C) No.18150 and 18448 of 2015 GTM Builder & Promoters Pvt. Ltd. Vs. M.C. Goel (decided on 16.10.2015) does not record its own reason on the issue of force majeure as such it do not lay down any ratio decendi or binding precedent. The builder relied upon judgments of Supreme Court in C.G. Govindan Vs. State of Gujarat, (1998) 7 SCC 625, Kunhayammed Vs. State of Kerala, (2000) 6 SCC 359 and P. Singaravelan Vs. District Collector, (2020) 3 SCC 133 and submitted that this judgment cannot be taken as a binding precedent. 

17.    Clause-23 of Application Form and Clause-14 of the agreement provide that “if the construction of the premises is delayed due to force majeure circumstances, which inter-alia include delay on account of non-availability of steel and or cement or other building materials, or water supply or electric power or slow down strike or due to a dispute with the construction agency, civil commotion or by reason of war or enemy action or earthquake or any act of God, delay in certain decisions/clearance from statutory body, or if non-delivery of possession is as a result of any notice, order, rules or notification of the Government and/or any other public or competent authority or for any other reason beyond the control of the company and if any of the aforesaid event, that shall extended time of delivery of the said premises on account of the force majeure circumstances”.

18.    So far as delay in removal of the rock from the site is concerned, the builder vide letter dated 07.02.2005, informed that excavation work was started as such there was no much delay on this count. The builder took plea that the contract for construction of the project was given to M/s. Sneh Developers Pvt. Ltd., though an agreement dated 10.03.2005, under which, construction had to be completed up to 31.10.2006. The builder gave a notice dated 31.07.2006 to M/s. Sneh Developers that construction was being delayed and was not likely to be completed on due date. On the assurance of M/s. Sneh Developers Pvt. Ltd., the period for construction was extended up to 30.09.2007 by supplementary agreement dated 28.09.2006. M/s. Sneh Developers was again found slow in construction. When complaint was made in this respect, M/s. Sneh Developers gave an undertaking on 31.08.2007 to complete construction up to 31.05.2008. The builder terminated the contract of M/s. Sneh Developers on 05.03.2008. Again on assurance given by M/s. Sneh Developers, period of construction was extended up to 30.09.2008 vide letter of intent dated 25.03.2008. However, M/s. Sneh Developers, despite receiving Rs.10.10 crores out of total Rs.14/- crores could not complete required construction, as such its contract was terminated on 29.08.2008. For completion of remaining work, the builder gave contract to M/s. S.S. Associates on 28.01.2009 and paid additional amount of Rs.1.7 crore. M/s. Sneh Developers did not permit the new contractor to work. Then, the builder took over the work and completed construction till April, 2011.

19.    The builder has filed judgment of Delhi High Court dated 03.07.2018, passed the proceeding arising out of the award of Arbitrator, in dispute between M/s. Sneh Developers and the builder. A perusal of this judgment shows that Claim No.1 of M/s. Sneh Developers in arbitration proceeding was for Rs.183085703/- and same was not found to be proved. There appears genuine dispute between the builder and M/s. Sneh Developers, who has delayed the construction and demanded exaggerated amount. The buyer nowhere stated that it was a collusive action of the builder and contractor.

According to the builder out of total contract money of Rs.14/- crores, Rs.10.10 crores was paid to M/s. Sneh Developers. It means, M/s. Sneh Developers might have completed 2/3^rd of the construction work. On this point the builder is silent. On termination of the contract of M/s. Sneh Developers on 29.08.2008, the builder was expected to complete remaining 1/3^rd work within 10 months i.e. 1/3^rd of 30 months. Even if five months grace period is given then also the builder is liable to pay compensation for delayed possession from January, 2010. The orders of State Commission holding that the builder was entitled for extension of period up to April, 2011, for which, the construction was delayed, are liable to be modified up to that extent.

20.    Third issue framed above is as to whether the complainants are liable to pay any additional amount, as being demanded by the developer? Vide letter dated 19.07.2011, the builder demanded Rs.383000/- as escalation in rates of material and labour, Rs.625500/- for enhancing proportionate area, Rs.237600/-, for Internal Development Charges, Rs.150000/- for documentation/completion certificate, Rs.215000/- for External Electrification dues, Rs.41817/- for interest and Rs.42563/- for Service Tax, from Arun Kumar Mishra. Amount for enhancing proportionate area is different for all the home buyers according to the rate, on which, they were allotted their unit.

21.    The builder gave up demand of Rs.237600/-, for Internal Development Charges, at the stage of the appeal. The builder demanded Rs.150000/- for documentation/completion certificate. Under the allotment letter or in agreement, it has not been provided that the home buyer would bear the charges of documentation/ completion charges, as such, demand in this respect was illegal. The builder claimed Rs.41817/- for interest. The builder could not file any previous demand letter, which was not honoured by the buyers, due to which, interest was charged. On the other hand, the buyers have asserted for timely payment of all the instalments. The builder, vide letter dated 23.05.2005, offered for 10% discount, in case payment is made under “Down Payment Plan”. Arun Kumar Mishra took loan and paid Rs.1469250/- on 28.06.2005, under this scheme. Balance amount was payable at the time of possession. Demand for Internal Development charges, completion certificate and interest were illegal and unfair trade practice.  

22.    The construction was unreasonably delayed as such escalation in rates of materials and labour was natural. From the award of Arbitrator in dispute between M/s. Sneh Developer and the builder, it is proved that the builder has paid escalation charges. The builder demanded Rs.383000/-, for escalation in rates of materials and labour, for which, the builder was entitled.

23. The builder demanded Rs.625500/- for increase in proportionate area. The builder gave a pre-launch offer @Rs.1500/- per sq.ft. till 30.11.2004. Some home buyers booked their flat under this scheme and some of the home buyer booked after expiry of this scheme at different rates as mentioned in their allotment letter/agreement. Clause-5 of the Allotment Letter and clause-12 of the agreement provide that price of the unit shall be determined on the basis of ‘super area’. Local Commissioner found ‘super area’ as 2479.44 sq. ft. instead of 2530 sq.ft., in report dated 13.01.2014. None of the parties filed any objection to this report and it has been confirmed. Demand of the amounts for enhanced proportionate area was illegal and unfair trade practice. All the home buyers are entitled for refund of money for 50.56 sq.ft. at the rate, on which, they were charged by the builder.

24.    The builder demanded Rs.215000/- for External Electrification dues. The home buyers stated that the builder had deposited only Rs.20/- lacs for External Electrification. The builder has not produced any evidence in this respect as to what amount was deposited for External Electrification. Under clause-2 (a) of the agreement, the builder can charge for External Electrification on pro-rata basis. Demand in this respect appears to be excessive.

25.    The builder demanded Rs.42563/- for Service Tax. The builder has produced the copies of returns of Service Tax paid for various years. Home buyers relied upon Circular No.108/02/2009-ST, dated 29.01.2009, issued by Central Board of Excise and Custom, New Delhi and judgment of Delhi High Court dated 03.06.2016 passed in W.P. (C) No.2235 of 2011 Suresh Kumar Bansal Vs. Union of India and submitted that service tax is not applicable on construction of these flats. By Finance Act, 2005, Section 30-a, has been added in Finance Act, 1994 and ‘service tax’ has been levied on construction of new building or civil structure. For determination of value of service, Service Tax (Determination of Value) Rules, 2006 has been framed. Delhi High Court in above case found that the rules were not appropriate for determination of service as such passed the order that service tax was not levy-able. Government of India amended Service Tax (Determination of Value) Rules, 2006 and removed the defect pointed out in it. However, on the basis of this judgment, the amount realized from the builder has not been refunded. As such demand of service tax was not illegal. 

26.    Issue of “Occupation Certificate” is concerned although it is sign qua non for delivery of possession but admittedly that all the home buyers have taken possession, either in year 2014 or on 02.05.2016. Resident Welfare Association has filed Writ Petition (C) No.19091 of 2019 before High Court of Punjab and Haryana, where all the persons necessary for deciding this issue were impleaded as the parties. As such, I leave this issue open, giving liberty to Resident Welfare Association to pursue its remedy in writ petition. On issue of “occupation Certificate” the builder shall execute conveyance deeds in favour of the home buyers within one month after taking necessary expenses. Till then possession of home buyers shall not be disturbed.    

27.    The builder, vide letter dated 12.12.2004 (page-118) committed to pay compensation at the rate of Rs.5/- per sq.ft. per month, if possession is not delivered on due date. The home buyers have prayed for compensation for delay in possession at the same rate. The builder took plea that possession was offered to the home buyers vide letter dated 27.04.2011. From the record it is proved that the builder applied for issue of “Occupation Certificate” in 03.10.2011. As such on 27.04.2011, the construction was not complete nor “Occupation Certificate” was obtained. In the absence of “Occupation Certificate” no one can be permitted to occupy in the group housing project. The home buyer cannot be compelled to take possession in illegal manner. Thereafter, the builder by issuing illegal demand has raised disputes. As such the date 27.04.2011 cannot be taken as date for offer of possession for the purposes of the compensation for delay in possession. Since the delivery of possession has been delayed as such, the home buyers are entitled for delayed compensation as prayed from due date of possession i.e. from January, 2010 till the date of delivery of possession. Supreme Court in Banglore Development Authority Vs. Syndicate Bank, (2007) 6 SCC 442, held that in the matter of contractual obligation, there is scope for compensation for mental agony and harassment. In DLF Homes Panchkula Pvt. Ltd. Vs. D.S. Dhanda, II (2019) CPJ 117 (SC) held when interest is awarded as compensation in the cases of refund of money, then awarding additional compensation was not justified.

ORDER

In view of the aforesaid discussions, all these appeals are disposed of and the orders of State Commission under appeals are modified as follows:-

(i)  Demands for enhanced proportionate area, Internal Development Charges, charges for documentation/ completion certificate and interest by the builder vide letter dated 19.07.2011 or subsequent thereto were illegal and are quashed.

(ii) The builder shall charge for External Electrification on pro-rata basis on the actual amount incurred for it.

(iii) The builder shall return for decrease of ‘super area’ to the extent of 50.56 sq.ft. at the rate, on which, the home buyers were charged along with interest @9% per annum from the due date of possession till actual payment, as mentioned in the agreement.

(iv) The builder shall pay delayed compensation to the home buyers at the rate of Rs.5/- per sq.ft. per month from 01.01.2010 till the date of actual delivery of possession.

(v) The builder shall prepare a fresh statement of account of all the appellants-home buyers including the amount deposited by them under the order of this Commission and pay amount payable to them within two months from this judgment.

(vi) As the demand made by the builder has been found as illegal and excessive, the builder will not charge any holding charges.

(vii) On issue of “occupation Certificate” the builder shall execute conveyance deeds in favour of the home buyers within one month after taking necessary expenses for that purpose. Till then possession of the home buyers shall not be disturbed.