JUSTICE DEEPA SHARMA, PRESIDING MEMBER

          The present Appeal has been filed against the order dated 08.05.2017 in CC No. 964 of 2016.

2.       The brief admitted facts of the case are that Appellant had advertised a project under the name and style of Palm Eco City situated at Mullanpur,  Garibdas, New Chandigarh, Punjab for sale of 300 sq.yds. of residential plot at basic sale price of Rs.54,00,000/-. The complainant booked a residential plot in the said project. On various dates,  undisputedly, the complainant had paid a sum of  Rs.27,00,000/- to the Appellant but no residential plot had been allotted to her despite waiting for several years.  The complainant learnt that at the time when the project was advertised, the Appellant did not  have requisite permission from the concerned authorities to sell the plot and being aggrieved, she filed the complaint.

3.       In its written version, the Appellant had not disputed that at the time when the project was launched and the application for residential plots were invited, they did not have the requisite permission from PAPRA and it was granted to them in the year 2017. It was, however, contended before the State Commission that since the permission had been granted and relate back to the original date and, therefore, it cannot be said that there was any unfair trade practice on their part.  It was submitted that it was the complainant who had defaulted in making the payment and executing the Builder Buyer Agreement.

4.       Parties led their evidences before the State Commission and the State Commission after going through the evidences of the parties and hearing the arguments of the learned counsel and perusing the record found the Appellant deficient in providing the service and, therefore, directed refund of deposited amount to the complainant. 

5.       The State Commission vide impugned order has disposed of 6 complaints and it had taken the facts of complaint bearing No.918 of 2016 titled as Shaminder Walia and Anr. Vs. Manohar Infrastructure and Constructions Pvt. Ltd. as a lead case and all these 6 complaints were taken for consideration together by the State Commission because the facts and circumstances in all these cases were identical except few things like dates and amounts.  It has held as under:

“16.  xxxxxxx

We are not going to agree with the contention raised. There is nothing on record that the said notification is retrospective in nature. As stated above, when the project was sold, not even a single permission was available with the opposite party. The sale was made in contravention of the provisions of PAPRA and upon issuance of notification in the month of January 2017, violation committed or admitted irregularities made, cannot be rectified. Similar question qua this very project, came up for consideration before this Commission in Sukhvinder Singh Hayer Vs. M/s Manohar Infrastructure and Constructions Pvt. Limited, Complaint case no.775 of 2016 decided on 23.03.2017 (02 connected cases), wherein it was observed as under:-

“It is specifically mentioned that before starting development of the proposed project, promoter was to obtain environmental clearance from the Ministry of Environment and Forest Government of India, in terms of EIA notification dated 14.09.2006. There is nothing on record that such clearance was obtained by the opposite party. Further, it was also mentioned that requisite amount be paid towards Punjab Urban Development fund, within a period of 30 days, from the date of sanctioning of layout plans. No evidence has been placed on record, showing payment of the aforesaid amount. Furthermore, it is mandated that the promoter shall also be responsible for getting No Objection Certificate from Punjab Pollution Control Board. No document exists on record, showing that such approval was obtained by the opposite party. Contention of Counsel for the opposite party that notification dated 25.01.2017 exempting applicability of many provisions of PAPRA qua mega project, the sale of plots in the year 2011 etc. stands rectified. We are not going to agree with the contention raised. There is nothing on record that the said notification is retrospective in nature. When project was sold, not even a single permission was available with the opposite party. The sale was made in contravention of the provisions of PAPRA and upon issuance of notification in the month of January 2017, violation committed cannot be rectified. Similar question qua this very project, came up for consideration before this Commission in Monika Vs. M/s Manohar Infrastructure and Construction Pvt. Limited, Complaint case no.251 of 2016 decided on 27.09.2016, wherein it was observed as under:-

“The pleadings of the parties indicate that when project was marketed and sold, not even a single permission was available with the project proponent/opposite party. There is a complete violation of the provisions of the PAPRA. It is an admitted case of the opposite party that application seeking exemption from the applicability of provisions of PAPRA is still pending under consideration, with the Authorities concerned. Unless exemption is granted, its violation would amount to adoption of an unfair trade practice, which is glaring and vivid on the part of the opposite party, in this complaint.

Qua a similar project launched by the opposite party in the same area, in Appeal No.248 of 2016, decided on 31.08.2016, titled as M/s Manohar Infrastructure and Constructions Pvt. Limited Vs. Sh.Tilak Raj Bakshi, under similar circumstances, this Commission, while dismissing the said appeal, has observed as under:-

“The documents placed on record clearly show that the project was launched without getting any permission from the Competent Authorities. Detailed brochure was issued showing facilities to be made available in the project launched and its layout plan. It is also on record that when it came to the notice of GMADA that the plots/flats are being sold unauthorizedly by the appellant, it gave a notice in the newspaper ‘Hindustan Times’ dated 18.08.2012, which reads thus:-

“PUBLIC NOTICE

This is for the information of one and all that it has come to the notice of the Competent Authority that one company named as M/s Manohar Singh & Co. is allegedly booking/selling plots in the Mullanpur- Siswan region near Chandigarh border in the State of Punjab. This is being intimated that the above said project is not approved by the State Government. The Competent Authority is initiating legal proceedings in this regard. If anybody has booked or purchased any plot in the locality mentioned above he/she is advised to contact the undersigned along with documentary proof for further legal action against the said promoter. Further, while buying any plot in any locality falling under the jurisdiction of GMADA, all are advised to visit the website www.gmada.gov.in to verify if the colony/project is approved or not.

Chief Administrator

GREATER MOHALI AREA DEVELOPMENT AUTHORITY, PUDA Bhawan, Sector 62, SAS Nagar”.

It is specifically stated in the notice dated 18.08.2012 that the appellant was allegedly booking/selling the plots in Mullanpur, near Chandigarh Border, in the State of Punjab, unauthorizedly. It was further stated that the project is not approved by the Competent Authority and it (Competent Authority) is initiating legal proceedings against the project proponent for its activity. Above said notice makes it very clear that when the plot was sold on 13.04.2012, the project was not approved by the Competent Authorities. It is also so reflected in the details given by the appellant with this appeal, which is available at page 33 of the paper book. Reading of above said document, makes it very clear that the project was approved by the Government on 25.04.2013; Letter of Intent (LOI) was issued on 03.05.2013; Change of Land Use (CLU) certificate was granted on 31.03.2014; project was registered on 21.06.2014; No Objection Certificate by the District Forest Officer, SAS Nagar, Mohali, was issued on 14.07.2014; Zoning plan was approved by the Chief Town Planner, Punjab on 24.11.2015 and Detailed Project Report (DPR)/Service Plans were approved by the Chief Engineer, GMADA, Mohali, on 27.11.2015. As per established law, if the project proponent sells the project without obtaining necessary permissions or clear title of the acquired land, it would amount to adopting unfair trade practice. It was so said by the Hon’ble National Commission in Atul Maheshwari and ors. Vs. Yamuna Expressway Industrial Development Authority, II (2016) CPJ 623 (NC). Relevant portion of the said judgment reads thus:-

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

Similar view was expressed by the National Commission in Emerging India Real Assets Pvt. Ltd. and another vs. Kamer Chand and another, Revision-Petition No.756 of 2016, decided on 30.03.2016. In that case, when upholding the findings given by this Commission, that the project cannot be even marketed before getting approvals/sanctions, from the Competent Authorities, to launch it, it was observed by the National Commission, as under:-

“We are unable to persuade ourselves to agree with the ld. counsel. While affirming the order passed by the District Forum and commenting and deprecating the conduct of the Opposite Parties in the complaint, in launching the project and selling the farmhouses, even without obtaining sanction/approval from the competent authority, the State Commission has observed as follows:-

If a marketing agency sells out a project, for which, no approvals/sanctions have been granted by the Govt. Authorities, the said agency has to face the music and consequences of duping the gullible buyers, of their hard-earned money. In the public notice, it has specifically been mentioned by the GMADA that respondent no.2 and appellant no.1 are the sister concern. It is also apparent on record that before appellant no.1 started marketing the project, not even an application has been filed by respondent no.2, to get approval/sanction from the competent authorities, to launch the project. The information supplied vide letter dated 26.08.2014, referred to above, clearly states that not even a single application qua granting sanction to the project, has been received and dealt with, by the Competent Authority. In connivance with each other, the appellants and respondent no.2 committed a criminal offence of cheating. As per established law, builder cannot sell its property, unless and until proper approvals/sanctions have been obtained by it, from the Competent Authorities. It appears from the reading of documents on record that instead of selling a unit in a project, respondent no.2 in a very arbitrary manner, sold its share in a joint land measuring approx. 3807 acres, bearing hadbast No.326, Khewat No.92, Khatauni no.254-352, at Village Mirzapur, District Mohali, Punjab. There is nothing on record that said land was ever partitioned.

6. We are in complete agreement with the view taken by the State Commission. As noted above, the petitioners happen to be body corporate. Before offering the farmhouses in the said project as Agent of Respondent No. 2, they must be aware about the status of the sanction for launch of the project. Therefore, it is beyond one’s comprehension that the present Petitioner was not aware about the actual state of affairs for which only the developer could be held responsible.”

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.

17. It was vehemently contended by Counsel for the opposite party that once exemption from the applicability of the provisions of PAPRA stood granted in the year January 2017, it will relate back to the date of launching of the project, and all irregularities stands rectified. To support above said contention, he has placed reliance on the ratio of judgment passed by the Hon’ble Supreme Court of India, titled as M/s Murudeshwara Ceramics Ltd. Vs. State of Karnataka, 2002 (1) R.C.R. (Civil) 130.

We are not going to accept the arguments raised. It has already been held in Sukhvinder Singh Hayer` case (supra) that upon issuance of notification in the month of January 2017, granting exemption from the applicability of the provisions of PAPRA, violation committed prior thereto, cannot be rectified. To so say, in Sukhvinder Singh Hayer` case (supra), reliance was also placed upon the judgment passed by this Commission in Monika`s case (supra). The said finding was given in consonance with the findings of the National Commission in Emerging India Real Assets Pvt. Ltd. and another vs. Kamer Chand and another`s case (supra).

As far as the reliance placed by Counsel for the opposite party on M/s Murudeshwara Ceramics` case (supra) is concerned, we have gone through the facts of the same very carefully and found that the same were altogether different from the facts of the present case. In the case before the Hon’ble Supreme Court of India, when interpreting the provisions of Section 109 of the Karnataka Land Reforms Act, 1961, it was stated that power of the Government to grant exemption with regard to the land, in any area from operation of some of the provisions of the Act, for using the said land for a particular purpose, are to be seen, not at the time of sale/purchase of the land in dispute, but at the time, when it was going to be put for the said use. It was noted that after sale of the land, in dispute, when it was going to be put for industrial use, exemption already stood granted. The position is altogether different; as in the present case, by indulging into selling the project without any sanctions in its hands, the opposite party has committed unfair trade practice, as defined in Section 2 (1) (c) (i) and (iii) of the CP Act.

It is apparent on record that in the year 2012, activities of the opposite party in selling the project, without any sanction were noticed by the Competent Authorities and on 18.08.2012, as a result whereof, notice was published in a newspaper, stating that such sale was illegal. Copy of newspaper dated 18.08.2012, in which the said public notice was issued by the GMADA, is placed on record as Annexure C-10, in consumer complaint bearing no.890 of 2016, titled as Sheela Devi and another Vs. Manohar Infrastructure and Constructions Private Limited.

Counsel for the opposite party by making reference to the contents of that notice reproduced in earlier part of this order, stated that the opposite party is named as M/s Manohar Infrastructure and Constructions Pvt. Ltd., whereas, the said notice was issued qua a project launched by a separate entity named M/s Manohar Singh & Co., which has nothing to do with the opposite party.

We are surprised, how such a contention can be raised. It appears that when raising that contention, the Counsel has failed to look into the documents and photographs placed on record, when filing the written statement on behalf of the opposite party. In the document Annexures C-1 and C-2, (admittedly issued by the opposite party) Logo of Manohar Singh & Co., has been used. The said logo appears as under:-

The same logo is available on various other documents on record and even on those documents, which were placed on record by the opposite party itself. Not only as above, in photographs placed on record as Annexure O- 6 colly., on the tower situated, just next to the site office of the opposite party, logo plus name of Manohar Singh & Co., is available. It shows as under:-

Above facts clearly indicate that notice published was qua the activities of opposite party only. The opposite party is a group of Companies. As such, the objection raised by Counsel for the opposite party, stands rejected.

19. In the present case, an attempt has been made to by-pass the above provision by showing the sale as an expression of interest to purchase a plot. It has been so said before this Commission, at the time of arguments also, by Counsel for the opposite party that sale of the plot has not yet been confirmed, as such, there was no need to get the Buyer’s Agreement executed.

Above said contention raised by the opposite party, qua similar project, in the same area, was rejected by this Commission, in Appeal No.248 of 2016, decided on 31.08.2016, titled as M/s Manohar Infrastructure and Constructions Pvt. Limited Vs. Sh.Tilak Raj Bakshi, wherein it was observed as under:-

“Furthermore, as is evident from the documents on record, the appellant is also guilty of violation of Section 6 of the Punjab Apartment and Property Regulation Act, 1995, (in short the PAPRA Act). In a very deceptive manner, an attempt has been made to show actual sale of plot, as an expression of interest. As has been held in earlier part of this order, vide document Annexure C-2, the terms and conditions of sale settled to make payment was also made available. Once it is so, by not offering the Buyers Agreement for signing in a reasonable time, say two to three months but on the other hand, after a lapse of many years of the sale of plot, the appellant has committed an unfair trade practice.”

20. It is evident from the facts mentioned above that when the project in question was sold, neither CLU nor any other permission was available with the opposite party. The Agreement was entered into with the Govt. only on 14.06.2013, to launch this project and that too, subject to many conditions. Facts clearly indicate that the opposite party was guilty of launching a project against mandate of law. In view of above contention of Counsel for the opposite party that the complainants waived of their right to raise any objection because it was known to them that the project has still not been approved, however, they opted to purchase, is liable to be rejected.”

6.       It is, therefore, clear that State Commission had duly considered all the arguments of the learned counsels for the Appellant as well as of the complainant while giving its findings relying on various case laws.

7.       While impugning this order, learned counsel for the Appellant has contended that State Commission while ordering refund has granted interest @ 13% p.a which is on the higher side.  It has also contended that besides granting compensation in the form of interest has also awarded compensation under the head of mental agony and physical harassment, which is contrary to the findings of the Hon’ble Supreme Court in the case of DLF Homes Panchkula Pvt Limited  Vs. D.S.Dhanda Etc. Etc. (2020) 16 SCC 318.

8.       Learned counsel for the complainant has relied on the findings in the case M/s Manohar Infrastructure and Constructions Pvt. Ltd. & Anr. Vs. Ankit Jain, First Appeal No. 185 of 2020 decided on 17.05.2022 and submitted that it is covered matter.  It is submitted that project Palm Garden, Palm Eco City and Palm Springs are part of one project called “Palm Spaces” and there is no difference in the project Palm Garden, Eco City and Palm Springs.

9.       I  have  heard the arguments of learned counsels for the parties and have perused the record.  The appellant has raised a similar arguments which has already been considered and rejected by the State Commission.  I found no infirmity in the findings of the State Commission regarding deficiency in service on the part of the Appellant.   From the facts, it stands duly proved on record that at the time when the project was promulgated and applications were invited for booking the residential plots by the Appellant, it did not have the requisite permission from the concerned authorities and, therefore, they had acted in violation of the expressed provisions of the rules and regulations governing them.  The fact that Appellant  did not have the requisite permission was never brought to the notice of the complainant who believed that project was having a requisite sanction and applied for booking of the residential plot.  It certainly amounts to unfair trade practices and also amounts to deficiency in service. The complainant had been left in limbo for many years without being sure whether she would get the residential plot or not.  After waiting for considerable time, the complainant had opted for refund of his money and, therefore, findings of the State Commission on this count cannot be said to be suffering with any illegality or infirmity.   It is a settled proposition of law as held by Hon’ble Supreme Court in Dhanda’s case ( supra ) that  where compensation in terms of interest is awarded, no compensation under any other head should be granted. Compensation awarded towards mental agony etc. is, therefore, quashed.

10      It is apparent that it is a covered case, covered by the case of Ankit Jain ( supra).  This Commission in that case while ordering the refund of the deposited amount had granted interest @ 9% p.a. and penal interest @ 12% p.a.. 

11.     I, therefore, partly allow the present Appeal and issue the following directions:

1.       The Appellant is directed to refund deposited amount of Rs.27,00,000/-  to the respondent / complainant along with interest @ 9% p.a. from the respective dates of deposit till the date of payment.

2.       To pay cost of litigation to the tune of Rs.44,000/- as awarded by the State Commission.

3.       While disposing of the present Appeal, I also award a litigation cost of Rs.50,000/- to the complainant.

4.       The entire payment shall be made within four months from the date of this order, failing which it will attract penal interest at the rate of 12% per annum.

12.     The Appeal is partly allowed.