Chandigarh

DF-I

CC/676/2022

RACHNA JAISWAL - Complainant(s)

Versus

MANOHAR INFRASTRUCTURE & CONSTRUCTION PVT LTD - Opp.Party(s)

SANDEEP BHARDWAJ

04 Nov 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-I,

U.T. CHANDIGARH

                                     

Consumer Complaint No.	:	CC/676/2022
Date of Institution	:	15/07/2022
Date of Decision	:	4/11/2024

 

1.     Rachna Jalewal D/o Sh. Suriner Jaiswal R/o House No. 1530, Phase 5, Mohali through her GPA holder (real brother) namely Amit Kumar Jawwal S/o Surinder Kumar Jalewal R/o House No. 1530, Phase 5, Mohali.

2. Sh. Suriner Jaiswal S/o Ganga Prasad R/o House No. 1530, Phase 5, Mohali.

Complainants

Versus

1.     Manohar Infrastructure & Constructions Pvt. Ltd, Corporate Office Manohar Campus SCO 139-141, Sector 17-C, Chandigarh 160017.

2.     Manohar Infrastructure & Constructions Pvt. Ltd, Site Office: Village Mullanpur Garibdas, PGI Road, District SAS Nagar, Mohali, Punjab.

3. Tarninder Singh Director/Authorized Signatory of Manohar Infrastructure & Constructions Pvt. Ltd, Corporate Office: Manohar Campus SCO 139-141, Sector 17-C, Chandigarh 160017.

4.     Narinderbir Singh Director/Authorized Signatory of Manohar Infrastructure & Constructions Pvt. Ltd, Corporate Office:- Manohar Campus SCO 139-141, Sector 17-C, Chandigarh 160017.

5.     Dhanwant Singh Sidhu Director/Authorized Signatory of Manohar Infrastructure & Constructions Pvt. Ltd, Corporate Office: Manohar Campus SCO 139-141, Sector 17-C, Chandigarh 160017.

 

5.     Sarabjeet Kaur Director/Authorized Signatory of Manohar Infrastructure & Constructions Pvt. Ltd, Corporate Office: Manohar Campus SCO 139-141, Sector 17-C, Chandigarh 160017.

… Opposite Parties

 

CORAM :	SHRI PAWANJIT SINGH	PRESIDENT
	MRS. SURJEET KAUR	MEMBER
	SHRI SURESH KUMAR SARDANA	MEMBER

                                                                               

ARGUED BY	:	Sh. Pranab Bansal, Advocat for complainants
	:	Sh. Nitesh Singhi, Advocate for OPs (through VC)

Per Pawanjit Singh, President

1. The present consumer complaint has been filed by the complainant under Section 35 of the Consumer Protection Act 2019 against the opposite parties  (hereinafter referred to as the OPs). The brief facts of the case are as under

1. It transpires from the allegations as projected in the consumer complaint that on 14.03.2012, the complainants on the allurement of the OPs booked a residential plot measuring 250 sq.  in their project ‘Palm Springs’ being developed by the OPs in Mullanpur (New Chandigarh), District SAS Nagar, Mohali (hereinafter referred to as “subject plot”).. The complainant submitted application (Annexure C-1) to the OPs and paid booking amount of ₹22,50,000/-,  out of the total sale consideration i.e. ₹45.00 lacs, and the OPs acknowledged the said amount  vide Annexure C-2.  Thereafter, the complainant approached the OPs many times but no update of the project was given by the OPs.  It is alleged that the OPs  received huge amount of Rs.22,50,000/- from the complainant without executing any agreement. Thereafter the complainant came to know that the OPs do not have requisite permissions and approvals at the time of receiving the consideration amount of the subject plot from the complainants. The OPs were not to  collect more than 25% of total price prior to entering the agreement to sale as such the Ops violated the provisions of PAPRA Act as in the instant case the Ops without executing any agreement received 50% of the total sale consideration from the complainant. It is alleged that the part of the project of the OPs was approved much later, in the year March 2013. The formal agreement was signed with the Govt. of Punjab on 14.06.2013. Thereafter, additional area was added and supplementary agreement was signed on 16.06.2016. The completion period granted in the agreement got expired on 13.06.2018. Notification granting exemption from the applicability of the provisions of PAPRA was issued only on 25.01.2017. The notification makes it very clear that exemption was given subject to certain conditions, which were also not complied with by the OPs. The opposite parties themselves have placed on record the documents proving that there is no permissions and approvals with them in the year 2011. The documents Le. Notification dated 15.01.2017, RERA registration dated 15.09.2017, Supplementary agreement executed with the Government of Punjab dated 16.06.2016 are annexed as Annexure/Exhibit C-6 to C-8. In this manner, the aforesaid act of OPs amounts to deficiency in service and unfair trade practice by not executing  buyer’s agreement and offering possession of the subject plot in a reasonable time.    OPs were requested several times to admit the claim, but, with no result.  Hence, the present consumer complaint.
2. OPs resisted the consumer complaint and filed their written version, inter alia, taking preliminary objections of maintainability, concealment of facts, limitation and also that the complainants are not covered under the definition of consumer.  It is further alleged that, in fact, the complainant was informed about the project approval and issuance of CLU in favour of the answering OPs and also about the status of the project at the time of expression of interest was executed. The competent authority had granted completion period till 13.6.2018 towards the project of the OPs, which was later on extended upto 31.12.2012 and it was for the complainant to come forward to execute the plot buyer’s agreement and comply with the terms and conditions. Even otherwise also, without prejudice to the defence of the OPs which was taken, no prejudice would be caused to the complainant if at the initial stage OP company was not having permission from the competent authority since a valid title could have been transferred in the name of the complainants after the allotment of the plot.  The OP company had also submitted application for extension of the completion of the project as some part of the mega project was yet to be completed whereas the major portion of the project has already been completed and the competent authority had granted extension regarding completion of the project upto 31.7.2019, which was later on extended upto 31.12.2022. The OP company had acquired land for the mega project and in this manner has been exempted from the provisions of the PAPRA, regarding which notification has already been issued on 25.1.2017.  The OP company had submitted application for the mega housing project as it was the owner of more than 100 acres of land and the fixed capital investment was also more than 100 crores and the project was later on sanctioned.  However, the project of the OP company was approved on 22.3.2013 by the Govt. of Punjab and thereafter formal agreement was signed and executed with the Govt. on 14.6.2013 and after the addition of more land, the mega project for the total area of 234.37 acres with an investment of ₹845 crores was sanctioned and the competent authority had also granted the completion period for the entire project upto 13.6.2018.  In this manner, the case of the OPs was under process and there was some procedural delay on the part of the Govt. in issuing the notification in this regard and the delay in completion of the project was only due to the considerable delay in approval by the Govt. for which the answering OPs are not responsible.  It is further alleged that the OP company has already allotted plots to the number of customers who have deposited amount as per the schedule and in this manner the complainants have no locus standi or cause of action to file the present consumer complaint.  On merits, the facts as stated in the preliminary objections have been reiterated. The cause of action set up by the complainants is denied.  The consumer complaint is sought to be contested.
3. In rejoinder, complainants re-asserted the claim put forth in the consumer complaint and prayer has been made that the consumer complaint be allowed as prayed for.

2. In order to prove their case, parties have tendered/proved their evidence by way of respective affidavits and supporting documents.
3. We have heard the learned counsel for the parties and also gone through the file carefully, including the written arguments.
   1. At the very outset, it may be observed that when it is an admitted case of the parties that the complainant had paid an amount of ₹22,50,000/- to the OPs for booking of the subject plot in the project of the OPs namely Palm Springs measuring 250 sq. yards, being 50% of the total cost of Rs.45,00,000/-, and the said payment has been acknowledged by the OPs vide acknowledgment Annexure C-2  and, till date, OPs have failed to execute either any agreement or offer possession of the subject plot, the case is reduced to a narrow compass as it is to be determined if the OPs have received the aforesaid huge amount from the complainant and had agreed to sell the subject plot without having any approval from the competent authorities as required under law and have also failed to execute the  agreement or deliver possession of the subject plot to the complainant, till date, and the said act of OPs amounts to deficiency in service and unfair trade practice on their part and the complainants are entitled to the reliefs prayed for in the consumer complaint, as is the case of the complainants, or if due to non-payment of the total sale consideration by the complainant to the OPs as well as due to force majeure circumstances, OPs have not executed any agreement and offered possession of the subject plot and the consumer complaint of complainant, being not maintainable, is liable to be dismissed, as is the defence of the OPs.
   2. The learned counsel for the complainant  contended with vehemence that as it stands proved on record that the OPs had received huge amount from the complainants without obtaining necessary approval from competent authorities and till date failed to deliver possession of the subject.
   3. On the other hand, learned counsel for the OPs contended with vehemence that  the complainants were duly informed regarding the project approval and issuance of CLU in favour of OPs and the complainants continuously showed their interest in the  project of the OPs and never raised any objection nor raised an immediate demand for refund rather the complainants are themselves defaulters and never approached the OPs. Hence, there is no deficiency on the part of the OPs.
   4. However, there is no force in the contention of the learned counsel for the OPs as it  is an admitted case  that when the OPs had advertised and started booking for the sale of plots in the year 2011-2012, , OPs were not even registered with the Greater Mohali Area Development Authority (GMADA), SAS Nagar, Mohali as a qualified project proponent to obtain licence under Section 5 of the PAPRA.  Not only this, even the certificate of registration was also granted by the GMADA in the year 2014, permitting the OPs to set up a colony subject to their obtaining requisite licences as mandated under the provisions of PAPRA. The various permissions and approvals obtained by the OPs after 2014 are  annexed as Annexure OP-7 to OP-30.
   5. The learned counsel for the complainant submitted that the project in question was sold without any permission(s)/sanction(s) from the competent authorities and also by violating the provisions of PAPRA Act appears to be correct, especially as it is clear from the above documents that the application for mega project was moved by the OPs on 12.9.2011 and the project was only approved by the Govt. on 25.4.2013 and the Letter of Intent was issued subject to certain conditions imposed by the competent authority on 3.5.2013, making further clear that even before receiving the huge amount of ₹22,50,000/- on different dates i.e. Rs.20,00,000/- on 21.3.2012 and Rs.1,15,000/- on 3.4.2012 as is evident from statement of account Annexure C-3 and  Rs.1,35,000/- in cash which fact is also corroborated from Annexure  C-2 the acknowledgement issued by OPs,  the project of the OPs was not registered with GMADA and even licence under Section 5 of the PAPRA was not issued to the OPs, especially when it has come on record that the certificate of registration was issued by the GMADA only on 27.6.2014.
   6. Moreover, the letter of intent (Annexure OP-4) had made mandatory for the promoters to fulfil certain formalities before advertising/launching the project and also to obtain certain approvals from the department, which have not been completed by the OPs in the present case. The relevant conditions are reproduced below for ready reference :-

“3(v)        The project shall not be advertised/launched and no money will be collected from General Public for allotment of land/plot/flat/any space till such time the layout plans/zoning plans are approved by the Competent authority and the exemption u/s 44 of the PAPR Act 1995 is issued by the State Govt.

        xxx                   xxx                   xxx

6.     This LOI is only a letter of intent issued by Punjab Urban planning & Development Authority in its capacity as Nodal Agency and does not confer any right to the Promoter/ Developer to sell/transfer the property or execute any transactions with anyone without obtaining valid approvals and requisite notification/order under Section 44 of PAPR Act, 1995, to be issued by the Department of Housing & Urban Development.”

7. Thus, one thing is further clear from the conditions laid down in the letter of intent that none of the same has been completed by the OPs before accepting 50% of the sale consideration from the complainants and booking the subject plot.
8. At the time of arguments, learned counsel for the OPs contended with vehemence that the issuance of notification dated 25.1.2017 by the Govt. granting exemption from applicability of many provisions of PAPRA qua the mega project in question will relate back to the year 2011, when application was filed to get licence under the mega housing policy and the said notification ratifies all the mistakes/ irregularities committed  by the OPs qua the sale of plots in the year 2011 without obtaining necessary sanctions and approvals from the competent authorities. However, there is no force in the contention of the learned counsel for the OPs as the pleadings of the parties indicate that when the project was marketed and sold by the OPs, not even a single permission was available with the project proponent/OPs and there is complete violation of the provisions of PAPRA.  It was also so said by the Hon’ble National Commission in the case titled as Atul Maheshwari and Ors. Vs. Yamuna Expressway Industrial Development Authority, II (2016) CPJ 623 (NC) and the relevant portion of the same is reproduced as under :-

“OP should not have announced the scheme, until or unless they got clear title of the acquired land”.

9. It has thus been proved on record that money had been collected by the OPs from the prospective buyers including the complainants, without obtaining statutory approvals/clearances. Collecting money from the prospective buyers and selling the plots/units in the project, without obtaining the required approvals/ clearances/amended clearance is an unfair trade practice on the part of the project proponent. It was so said by the Hon’ble National Commission, in a case titled as M/s Ittina Properties Pvt. Ltd. & 3 Ors. Vs. Vidya Raghupathi & Anr., First Appeal No. 1787 of 2016, decided on 31.5.2018 and the relevant portion of the order reads as under:-

“…………….This Commission in Brig. (Retd.) Kamal Sood Vs. M/s. DLF Universal Ltd., (2007) SCC Online NCDRC 28, has observed that it is unfair trade practice on the part of the Builder to collect money from the perspective buyers without obtaining the required permission and that it is duty of the Builder to first obtain the requisite permissions and sanctions and only thereafter collect the consideration money from the purchasers.

It is an admitted fact that the sale deeds were executed in the year 2006 and by 2009 the completion certificate was not issued. The Occupancy Certificate was issued only on 25.09.2017 during the pendency of these Appeals before this Commission. Allotting Plots or Apartments before procuring the relevant sanctions and approvals is per se deficiency…………”

10. In the present case also, there is nothing on record that when expression of interest/applications were invited to sell the said project, clear intimation was given to the intending purchasers that the project sold was in infancy stage and it will take years together before necessary permissions will be provided by the Competent Authorities.
11. The learned counsel for the OPs further contended with vehemence that the application to get the mega project approved was filed in the year 2011 and the delay has occurred on account of the laxity on the part of the bureaucrats/competent authorities in granting permission/approvals.  However, such a plea has been taken by the OPs just to raise it without any material on record.  Moreover, as it has already been discussed above that the OPs in complete violation of the provisions of PAPRA have launched the project, without seeking permission and collected huge amount from the complainants, which they could not have collected or advertised the project for sale, especially when they were not registered with GMADA even at that time, the aforesaid plea taken by the OPs is without merit.
12. Learned counsel for the OPs further contended with vehemence that as the complainants have not paid the remaining further installments as per the payment plan, despite of repeated requests by the OPs, and the complainants have committed default in the payment, they are not entitled for possession or compensation.  However, the principle of law was laid down by the Hon’ble Apex Court qua the payments to be made by the allottees in installments in the case of Haryana Urban Development Authority Vs. Mrs. Raj Mehta, Appeal (Civil) 5882 of 2002, decided on 24.09.2004 wherein it was held that if the builder is at fault in not delivering possession of the units/plots by the stipulated date or within a reasonable period where no agreement is executed, it cannot expect the allottee(s) to go on paying installments to it. Similar view had also been taken by the Hon’ble National Commission, in Prasad Homes Private Limited Vs. E.Mahender Reddy and Ors., 1 (2009) CPJ 136 (NC), wherein it was held that when development work was not carried out at the site, payment of further installments was rightly stopped by the purchaser.   Accordingly, the aforesaid plea taken by the OPs in this regard stands rejected.
13. The consumer complaint is further resisted by the OPs on the ground that the same is beyond the limitation period.  However, when it is an admitted case of the parties that the possession of the subject plot has not been offered and also that the OPs are still not ready with possession even at the time of filing of the instant consumer complaint or till date, as such the objection taken with regard to limitation is not sustainable in view of the principle of law laid down in Lata Construction & Ors. Vs. Dr. Rameshchandra Ramniklal   Shah and Anr., AIR 1999 SC 380 and Meerut Development Authority Vs. Mukesh Kumar Gupta, IV (2012) CPJ 12 (SC), wherein it was held that when possession of the residential units/plots is not offered, there is a continuing cause of action, in favour of the allottee/buyer.
14. Now the question arises, as to what amount of compensation, the complainants are entitled to, for delay in delivery of possession of the plot to them and for which period? Admittedly, in the present case, agreement has not been executed by the OPs, which act has been held to be an unfair trade practice on their part. Thus, in the absence of a specific date of delivery of possession in any of the documents, placed on record, we are of the considered opinion that we cannot make the complainants to wait for an indefinite period in the matter in view of principle of law laid down by the Hon’ble Supreme Court of India in Fortune Infrastructure Vs. Trevor D’ Lima & Ors. (2018) 5 SCC 442, relevant part whereof is reproduced hereunder, that will meet the ends of justice:-

“…… 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…”

15. In Recently, the Hon’ble National Commission in Sanjiv Kumar Jain & Anr. Vs. Lodha Crown Buildmart Private Limited, II (2023) CPJ 271 (NC) has held that inordinate delay in offer of possession, amounts to ‘deficiency in service’ and home buyer can ask for refund on this ground alone and if unreasonable delay in offer of possession is proved then it is sufficient to grant relief of refund and other grounds are not liable to be examined.  The relevant headnote of the order is reproduced below for ready reference :-

“(iii) Consumer Protection Act, 1986 — Sections 2(1)(g), 14(1)(d), 21(a)(i) — Housing — Booking of duplex flat — Non-delivery of possession — Deficiency in service — Inordinate delay in offer of possession, amounts to ‘deficiency in service’ and home buyer can ask for refund, on this ground alone — If unreasonable delay in offer of possession is proved then it is sufficient to grant relief of refund and other grounds are not liable to be examined — As there was unreasonable delay in offer of possession, complainants are entitled for refund of full amount under Clause 11.3 of agreement — Home buyer cannot be made to wait for possession of flat for indefinite period — Opposite party is directed to refund entire amount deposited by complainants with interest @ 9% per annum from date of respective deposit till date of payment.”

 

4. In view of the above discussion, the consumer complaint deserve to succeed and the same are accordingly partly allowed. OPs are directed as under :-
   1. To refund Rs.22,50,000/- to the complainants alongwith interest @ 9% per annum (simple) from the respective dates of deposited till onwards
   2. To pay ₹50,000/- to the complainants as compensation for causing mental agony and harassment to them and also deficiency in providing service and adoption of unfair trade practice;
   3. To pay ₹10,000/- to the complainants as costs of litigation.
5. This order be complied with by the OPs jointly and severally within a period of 45 days from the date of receipt of certified copy thereof, failing which the amount(s) mentioned at Sr.No.(i) & (ii) above shall carry penal interest @ 12% per annum (simple) from the date of expiry of said period of 45 days, instead of 9% [mentioned at Sr.No.(i)], till realisation, over and above payment of ligation expenses..
6. Pending miscellaneous application(s), if any, also stands disposed of accordingly.
7. Certified copies of this order be sent to the parties free of charge. The file be consigned.

Announced 4/11/2024		- [Pawanjit Singh] President
mp
		[Surjeet Kaur] Member
		- [Suresh Kumar Sardana] Member