This first appeal has been filed by the appellant M/s. Barnala Builder & Property Consultants, challenging the order dated 6th February 2018 passed by the State Consumer Disputes Redressal Commission, Punjab Chandigarh (in short ‘the State Commission’) in CC No. 831 of 2017. 2. Brief facts of the case are that the respondents/ complainants booked a flat in the project of the appellant/ opposite party and they were allotted flat No. 404 in Block D-6 on second floor measuring 1037 square feet. After about a year, the respondents got the flat changed and they were allotted that No. 102 in Block D-4 with 1307 square feet area in Maya Garden City and this allotment was dated 8th September 2012. The total consideration of the flat was Rs.38,00,233/-and the complainants opted for construction linked payment plan and the complainants paid Rs.34,20, 210/- to the opposite party which was 90% of the total consideration. The opposite party offered possession on 14th November 2014 and demanded the remaining consideration along with service tax, maintenance charges and interest as under:- a. Rs.3,80,047/-: towards the balance cost of the flat. b. Rs.2,44,794/- towards the interest till date. c. Rs.1,17,427/-: towards the service tax d. Rs.1,29,394/-: towards the one time maintenance Charges for 3 years + 3 years free. 3. The complainants objected to the demand in respect of the interest and maintenance charges and they did not pay the demand and did not take the possession. Rather, the complainants filed a consumer complaint No. 263 of 2015 before the District Forum of SAS Nagar Mohali Punjab (in short ‘the District Forum’). The complaint was resisted by the opposite party on the ground that some of the installments were not paid in time and therefore the interest was charged as per the agreement. Similarly maintenance charges were also charged as per the agreement. The remaining amount of the consideration as well as the service tax are in any case payable by the complainants. Pleading no deficiency on the part of the opposite party, the appellant further stated that the possession of the flat was offered on 14th November 2014 and it was requested that the complaint may be dismissed. However, the president of the District Forum allowed the complaint vide it's order dated 25th January 2016 whereas the two members gave their dissenting opinion on some points. The complainants as well as the opposite party preferred appeals before the State Commission. The Appeal No. 227 of 2016 filed by the opposite party was dismissed in limine vide order dated 5th April 2016. However, the Appeal No. 247 of 2016 filed by the complainants was partially allowed vide order dated 1st June 2017 and the matter was remanded to the District Forum with a specific direction to the members to clarify their opinion. Though the opposite party preferred a revision petition before this Commission against the order dated 5th April 2016 being revision petition No. 2444 of 2016 but the same was dismissed as withdrawn vide order dated 6th July 2017. Thus, the matter rested with the District Forum and District Forum finally allowed the complaint vide it's order dated 18th July 2017 and directed the opposite party to cancel the demand relating to interest and maintenance charges. The opposite party preferred appeal being FA No. 637 of 2017 before the State Commission. 4. The original complaint No.263 of 2015 rested at that stage, however, the complainants again filed a complaint being CC No. 831 of 2017 alleging that the opposite party has used the flat allotted to the complainants for their office purpose and the flat has not remained a new flat and therefore asked for the refund of the paid amount along with interest. It was also alleged that the opposite party did not have the completion certificate and therefore the opposite party could not have offered the possession of the flat. This complaint was also resisted by the opposite party stating that this complaint was not maintainable as there is no provision for filing a second complaint for the same cause of action and the earlier order will work as res judicata for the present complaint. Apart from this, it was stated that the partial occupancy certificate was obtained on 8th December 2016 and the complainants are avoiding taking possession. The State Commission vide it's order dated 6th February 2018 has allowed the complaint and has directed the appellant /opposite party to refund Rs. 34 20,186/- along with interest at the rate 12% per annum from the respective dates of deposit as well as to pay a compensation of Rs. 50,000 including the cost of litigation. 5. Hence the present appeal. 6. Heard the learned counsel for the parties and perused the record. The learned counsel for the appellant stated that the complainants had earlier filed a complaint before the District Forum for correcting the demand raised by the appellant for interest and maintenance charges. The District Forum finally decided this complaint vide order dated 18th July 2017 and the appeal was filed by the appellant challenging that order before the State Commission being FA No. 637 of 2017. Meanwhile, the complainants have filed this complaint No. 831 of 2017 seeking refund of the paid amount. There is no provision in the Consumer Protection Act 1986 to file a second complaint on the same cause of action. The State Commission should not have entertained the present complaint and the same should have been dismissed on the ground of res judicata as the decision in the first complaint will act as res judicata for the present complaint. 7. Apart from the above technical point, the learner learned counsel also argued on merits and stated that the demand raised by the appellant consisted of the balance amount of consideration, service tax, interest payable on installments paid with delay by the complainants as well as the advance maintenance charges as per the provisions of the agreement. None of these charges was against the agreement signed between the parties and therefore there was no ground for the complainants to challenge this demand and not to take the possession when the same was offered on 14th November 2014. In fact, due to downtrend of the real estate market, the complainants did not want to take the possession of the flat and had intended to get back their money paid to the appellant right from the very beginning. In the present complaint, the refund has been sought on very flimsy ground that the opposite party has used the flat allotted to the complainants for their office purpose and therefore it was not a new flat. The complainants very well know that the whole project is a new project and whenever the possession will be taken by the complainants the flat will be given in totally new condition fully fitted with all the amenities as per the agreement. Therefore this is totally an unrealistic reason to seek refund. 8. Coming to the other issue of completion certificate raised by the complainants the learned counsel for the appellant/ opposite party stated that the partial completion certificate in respect of the building where the flat of the complainant was situated was obtained on 8th December 2016. Thus, the complainants made wrong averment in the complaint that the completion certificate was not obtained. Thus, both the reasons mentioned in the complaint for seeking refund are not valid, however, the State Commission has still passed an order of refund along with 12% p.a. interest which is quite excessive. It was argued by the learned counsel for the appellant that the State Commission has not considered the Clause 9 of the agreement which entitles the opposite party to deduct 10% of the amount paid if the complainants cancel the agreement and seek refund. Moreover, the State Commission has allowed refund in accordance with Rule 17 of the Punjab Apartment and Property Regulation Act (PAPRA) whereas the present complaint has been filed under the Consumer Protection Act 1986 and therefore the provisions of PAPRA are not mandatorily applicable on the consumer disputes. The construction was completed within time and possession was offered to the complainants within time and therefore the money paid by the complainants was already spent in the construction work and therefore there is no question of paying any interest on the amounts deposited by the complainants. There is no provision in the agreement signed between the parties for giving any interest on the amount of refund after deducting 10% of the amount paid. Both the parties are bound by the agreement and therefore even if the amount is to be refunded the same can only be refunded after deduction of 10% of the amount paid with no interest. The learned counsel further mentioned that as per Clause 17 of the agreement, the complainants are liable to pay interest at the rate 20% per annum on all the amounts paid with delay as per the schedule of payment. The complainants have not shown any mistake in the demand of interest which is as per the agreement. Similarly the learned counsel asserted that as per Clause 13 of the agreement dated 19th September 2012, the appellant is entitled to receive the maintenance charges towards the said flat. Therefore, all the demands made by the appellant are in accordance with the agreement signed between the parties. 9. The learned counsel has further stated that the State Commission has erred in not considering the partial completion certificate which is a relevant document for fair disposal of the present case. It was also stated that the State Commission failed to acknowledge the fact that the Respondent was required to deposit 90% cost of flat i.e. 34,20,210 by 08.01.2013 but the respondent made his last payment on 05.08.2013, thus there is huge delay of 8 months in making the payment. This will definitely attract interest. 10. On the basis of the aforesaid arguments, the learned counsel for the appellant requested for setting aside the impugned order of the State Commission. 11. On the other hand, the learned counsel for the respondents/ complainants stated that the State Commission has dealt with the issue of the earlier complaint and the present complaint. It has been observed by the State Commission that the earlier complaint was filed in respect of the illegal demand by the opposite party which was in respect of the interest and maintenance charges, whereas, the present complaint is in respect of refund of the amount paid. In fact the State Commission has observed the following:- “12. So far as the application of principle of res judicata under Order II Rule 2 of the CPC is concerned, the earlier complaint was filed by complainant No.1 before the District Forum, SAS Nagar, Mohali, with regard to completion certificate, withdrawing of illegal demand of interest and invoking penalty clause but in the present complaint the complainants are seeking for the refund of the entire amount paid by them on account of non-providing of completion certificate and non-handing of possession of the flat in question for more than three years. Moreover, complainant No.1 had withdrawn the said complaint in FA No.637 of 2017 (M/s. Barnala Builders & Property Consultants V. Krishan Gopal) which was allowed by this Commission, vide order dated 25.1.2018. Therefore, as on today there are no parallel proceedings going on between the parties on the same cause of action. Moreover, the cause of action in the earlier complaint and the cause of action in the present complaint are altogether different and, as such, the principle of res judicata is not applicable in the present case. The objection is also rejected being devoid of merit.” 12. It was further stated by the learned counsel for the complainants that the possession was offered on 14.11.2014 without having obtained the completion certificate or the occupation certificate. Thus, this was an illegal offer of possession and therefore complainants cannot be blamed for not taking the possession at that time. The opposite party has alleged that they have obtained the partial completion certificate on 8th December 2016 i.e. after 2 years of the date of due possession and therefore complainants cannot be compelled to take possession so belatedly. Once the legal possession is not offered within the stipulated time, then the complainants are entitled to seek refund. The State Commission has clearly observed that the complainants withdrew the earlier complaint No.263/2015 during pendency of the appeal filed by the opposite party being FA No. 637 of 2017 and the same has been accepted by the State Commission vide their order dated 25th January 2018. Thus now, there is no existence of the earlier complaint and the only complaint is the current complaint being CC No. 831 of 2017. Thus, there is no question of res judicata. 13. I have carefully considered the arguments advanced by the learned counsel for both the parties and examined the record. In the present case, it is clear that the appellant/ opposite party offered the possession within the stipulated time on 14th November 2014, however, the complainants refused to take the possession on the ground that there was an illegal demand in respect of interest and maintenance charges. As the complainants have finally withdrawn the first complaint before the State Commission, fallacy and falsehood of the grievance of the complainants in respect of the interest or maintenance charges stands vindicated. Once the basis for the earlier complaint CC No. 263 of 2015 goes away, there seems to be no basis for the complainants to have not taken the possession when the same was offered on 14th November 2014. The partial completion certificate has been obtained by the opposite party on 8th December 2016 i.e. is before filing of the present complaint. The complainants were pursuing the original complaint No. 263 of 2015 even after the complaint was remanded by the State Commission vide their order dated 1st June 2017. This means that by that time, the complainants were interested in taking the possession and they had only the grievance of maintenance charges and the interest demanded by the opposite party. By that time, even the partial completion certificate was obtained by the opposite party and therefore there was no reason why the complainants should not have taken the possession particularly after the first complaint was allowed by the District Forum vide their order dated 18th July 2017. Suddenly the complainants changed their stand and sought refund of the amount paid to the opposite party and filed the new complaint No. 831 of 2017. The sudden change in the stand of the complainants may not be genuine and may have been driven by the downtrend in the real estate market. Though the possession offered on 14.11.2014 cannot be said to be the legal possession because the completion certificate or the occupation certificate was not obtained by then and on this basis only, the demand of refund by the complainants can be considered. Here, I have my reservations on the order of the State Commission dated 25th January 2018 allowing the withdrawal of the earlier complaint No. 263 of 2015 at appellate stage where the appeal filed by the opposite party being FA No. 637 of 2017 was being considered. However, the order dated 25th January 2018 is not under challenge presently and therefore I shall refrain myself from making any comments on that order and shall take the fact that the earlier complaint stands withdrawn and therefore the only complaint that remains is complaint No. 831 of 2017. Thus, the question of maintainability of complaint No. 831 of 2017 rests settled. 14. The main question in the present appeal relates to the issue whether the complainants are entitled to refund at this stage. The Hon’ble Supreme Court in Civil Appeal No.12238 of 2018 titled as “Pioneer Urban Land & Infrastructure Ltd. versus Govindan Raghavan” has observed that if the occupation certificate is obtained after a long delay from the date of due possession, then, the complainant cannot be compelled to take possession. The order reads as under:- “3.8. The National Commission vide Final Judgment and Order dated 23.10.2018 allowed the Consumer Complaint filed by the Respondent - Flat Purchaser, and held that since the last date stipulated for construction had expired about 3 years before the Occupancy Certificate was obtained, the Respondent - Flat Purchaser could not be compelled to take possession at such a belated stage. The grounds urged by the Appellant - Builder for delay in handing over possession were not justified, so as to deny awarding compensation to the Respondent - Flat Purchaser. The clauses in the Agreement were held to be wholly one - sided, unfair, and not binding on the Respondent - Flat Purchaser. 6 The Appellant - Builder was directed to refund Rs. 4,48,43,026/- i.e. the amount deposited by the Respondent - Flat Purchaser, along with Interest @10.7% S.I. p.a. towards compensation. 9. We see no illegality in the Impugned Order dated 23.10.2018 passed by the National Commission. The Appellant - Builder failed to fulfill his contractual obligation of obtaining the Occupancy Certificate and offering possession of the flat to the Respondent - Purchaser within the time stipulated in the Agreement, or within a reasonable time thereafter. The Respondent - Flat Purchaser could not be compelled to take possession of the flat, even though it was offered almost 2 years after the grace period under the Agreement expired. During this period, the Respondent - Flat Purchaser had to service a loan that he had obtained for purchasing the flat, by paying Interest @10% to the Bank. In the meanwhile, the Respondent - Flat Purchaser also located an alternate property in Gurugram. In these circumstances, the Respondent - Flat Purchaser was entitled to be granted the relief prayed for i.e. refund of the entire amount deposited by him with Interest.” 15. Relying on the above judgment of the Hon’ble Supreme Court, it is seen that in the present case also, the completion certificate has been obtained after 2 years from the date of due possession and therefore if the allottee wants refund, the same cannot be denied and the allottee cannot be compelled to take possession at this stage. As the delay has happened in obtaining the completion certificate by the opposite party, Clause 9 of the agreement cannot be invoked by the opposite party for forfeiting 10% of the amount paid. However, the crucial question in the present case, keeping the facts and circumstances of the case in mind, would be to decide the rate of interest on the amount of refund. The State Commission has relied upon Rule 17 of the PAPRA and has awarded 12% p.a. interest on the amount of refund from the dates of respective deposits. The complaint has been filed under the Consumer Protection Act 1986 and it is not mandatory on the consumer forum to adopt the provision of the PAPRA in deciding the complaint case. This Rule 17 of the PAPRA will definitely be applicable if the complaint is filed under the PAPRA before the competent authority. In the matters of refund, the deficiency on the part of the opposite party has to be kept in mind while deciding the compensation to be granted to the complainant. In the present case, there seems to be no valid reason for seeking refund, once the partial completion certificate was obtained by the opposite party and the possession was already offered earlier. However, if the complainants seek refund, the same cannot be denied as the possession could not be handed over within the stipulated period or with reasonable delay, but the compensation to be allowed to the complainants has to be determined on the basis of the facts of the case particularly keeping in mind that the complainants were ready to take possession and they had objection only in respect of the interest amount and the maintenance charges demanded by the opposite party but suddenly they changed their stand and sought the refund. In fact, the opposite party has invested all this money in the project and the amount is not earning any interest. But as the amount remained with the opposite party, the opposite party is liable to give interest on this amount of refund as held by the Hon’ble Supreme Court in Alok Shanker Pandey Vs. Union of India &Ors., II (2007) CPJ 3 (SC) as under:- “9. It may be mentioned that there is misconception about interest. Interest is not a penalty or punishment at all, but it is the normal accretion on capital. For example if A had to pay B a certain amount, say 10 years ago, but he offers that amount to him today, then he has pocketed the interest on the principal amount. Had A paid that amount to B 10 years ago, B would have invested that amount somewhere and earned interest thereon, but instead of that A has kept that amount with himself and earned interest on it for this period. Hence equity demands that A should not only pay back the principal amount but also the interest thereon to B.” 16. In the facts and circumstances of the present case and as examined above as well as keeping the current interest scenario in mind, I deem it appropriate to allow interest at the rate 8% p.a. on the amount of refund. 17. Based on the above discussion, the first appeal no.937 of 2018 is partly allowed and the order of the State Commission is modified to the extent that the interest on the amount of refund of Rs.34, 20,186/- will be 8% per annum instead of 12% per annum as awarded by the State Commission. With this modification, the order of the State Commission is upheld. The order of the State Commission as modified by this order be complied by the appellant/ opposite party within a period of 45 days from the date of receipt of this order. |
