District Consumer Disputes Redressal Commission ,Faridabad.
Consumer Complaint No.393/2020.
Date of Institution: 23.10.2020.
Date of Order: 28.02.2022.
1 Pushkar Rana Age 42 years son of Shri U.S.Rana resident of 1520, Sector-55, Faridabad – 121005.
2. U.S.Rana Age 72 years son of Lt. Shri Aan Singh Bist resident of 1520, Sector-55, Faridabad – 121005.
3. Radha Rana age 38 years wife of Mr. Pushkar Rana resident of 1520, Sector-55, Faridaba d- 121005.
…….Complainants……..
Versus
1. M/s. BPTP Limited, Registered office OT-14, 3rd floor, Next Door Parklands, Sector-76, Faridabad, Haryana – 121004 through Managing Director.
2. M/s. New Age Town Planners Limited (Now known as M/s. BPTP Parklands Pride Limited) Registered office M-11, Middle Circle Connaught Circus, New Delhi- 110001 through Managing Director.
…Opposite parties……
Complaint under section-12 of Consumer Protection Act, 1986
Now amended Section 34 of Consumer protection Act 2019.
BEFORE: Amit Arora……………..President
Mukesh Sharma…………Member.
Sujata Pruthi …………………………Member.
Consumer Complaint No.393/2020.
PRESENT: Sh. Rahul Rathore , counsel for the complainant.
Sh. Jai Shankar, AR on behalf of opposite parties Nos.1 & 2.
ORDER:
There are 10 complaints filed by the consumers against the BPTP bearing No. CC/393/2020, CC/394/2020, CC/395/2020, CC/396/2020, CC/397/2020, CC/398/2020, CC/399/2020, CC/400/2020, CC/401/2020 & CC/402/2020 with the prayer: deliver the possession of the apartment alongwith registered conveyance and Occupancy Certificate to the complainant alongwith compensation for delayed possession with penalty under Clause 5.3. of Flat Buyer’s Agreement, the rate of compensation is fixed @ 5/- per sq. ft. per month,
2. The facts in brief of the Complaint are that lured by the glamorous representations contained in the brochure issued by the OP, Complainant booked a unit on construction linked plan for residential use by him and his family and was allotted unit no. PA-243-FF in the project ‘Park Elite Floors, Faridabad’ developed by the OP. The Complainant has duly paid all demands raised by the OP totaling to Rs. 17, 30,014/- and that despite receipt of nearly total cost of the unit, the OP has delayed possession of the unit. As per clause 5.1 of the Agreement dated 10.04.2012 (FBA), OP ought to have completed the construction of unit within 24 months from the date of execution of the FBA i.e. by 10.04.2014. The clause provides for further extension of 180 days after the said timelines, only for obtaining Occupation Certificate. Hence OP ought to have completed the Unit and obtained the Occupation Certificate within 24 months + 180 days i.e. latest by 10.10.2014. However, till date, despite a lapse of around 6 years, the OP has failed to complete the Unit and obtain Occupation Certificate. This is a gross deficiency of service and unfair trade practice. Complainant is entitled to a direction to OP to deliver possession of the Unit and is further entitled to
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compensation for delay in delivery of possession at a fair rate. Though under clause 5.3 of FBA, the rate of compensation is fixed @Rs.5/- per sq. ft. per month, the law is settled that the allottee suffering a long delay is entitled to a fair compensation. OP is liable to register conveyance in favour of Complainant at the same rate of stamp duty and registration as was applicable at the time of the unit ought to have been delivered as per agreed schedule in FBA and compensate Complainant for increase in such charges if any. In Brochure, the OP presented a glamourous, luxurious project, representing the organized green landscaped areas, Kids Park, jogging and walking track, sitting areas, adequate street lighting and open area lighting but none of these amenities have been developed by OP till today. OP represented that the Parklands Township has its own schools, hospitals, local shopping centers and fully developed roads, street lighting, sewerage system, water connection, drainage, children’s parks and 24*7 security system but none of these amenities are developed. Even the extremely basic amenities like roads are not developed yet. The internal sewerage system is still not connected to the external sewerage system for reasons not known to Complainant. Under “Annexure B Specifications of floor” attached with FBA, the OP was to provide a recreational club and under Clause 1.5 (e) of the FBA, Complainant was required to pay Club Membership Charges of Rs.50,000/-. The imposition of Club Membership Charges is illegal and unjustified because OP has not constructed any Club till today. Hence, all recoveries made by the OP against club charges of Rs.50,000/- are liable to be refunded with interest. The Complainant apprehends that OP would (like for other allottees) raise additional illegal demands such as for increased in Super Built Up Area, escalation, electrical connection charges etc. Complainant reserves his right to challenge the same as and when demands are raised. The Complainant has prayed for directions to the OPs to-
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- deliver possession of the apartment along with registered conveyance and Occupation Certificate to the Complainant along with compensation for delay calculated @18% PA on amounts paid by the Complainant.
- In the event stamp duty and registration charges at the time of registration of conveyance are higher than the rate applicable on the promised date of possession, OP should compensate the excess amounts that Complainant will have to pay for stamp duty and registration
- to revoke and cancel demand under the head“Club Membership Charges” and refund the amount already recovered earlier with interest @18% pa.
- To pay a sum of Rs.10,00,000/- to compensate the Complainant for non-provision of promised amenities.
- To pay a sum of Rs.10,00,000/- by way of mental harassment and suffering and unfair trade practices.
- to pay a sum of Rs.50,000/- as litigation expenses.
- Such other relief that this Hon’ble Commission may deem appropriate in the interest of justice.
- The Opposite Parties put in appearance through AR and filed written
statement wherein Opposite Parties refuted claim of the Complainant and submitted that Opposite Party No. 2 “M/s New Age Town Planners Ltd.” (now known as “M/s BPTP Parkland Pride”) was only a confirming party to the said transaction and had not accepted any payment/s from the Complainant and hence, was not liable for any action undertaken by Opposite Party No. 1. The complaint under reply was not maintainable being hopelessly barred by limitation. The Complainant had booked the unit for resale or commercial purpose and is thus an investor and not a consumer in terms of Section 2(7) of the Consumer Protection Act.
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On merits, it was pleaded that the Complainants after having
conducting due diligence and out of their own volition approached OP No.1 and applied for a booking of a residential floor in the project namely ‘Park Elite Floors’ situated at Faridabad. Further, the Complainants on their own will invested towards registration amount and consented to abide by terms and conditions of Application for Allotment (Booking Application). OP No.1 conducted allotments by draw of lots on 11.12.2009 and vide letter dated 31.12.2009 informed the Complainants that their name was not shortlisted in the draw of lots held for the purpose of allotment and offered refund if they did not wish to wait for second phase of allotment.That further the OP No.1 vide letter dated 09.07.2011 informed the Complainants that second phase of allotment for Park Elite Floors would be conducted via draw of lots and also shared alternate option of refund of deposited amount, in case the Complainants do not wish to wait/stay for the second phase of allotment. On receipt of said letter dated 09.07.2011, the Complainants rightfully provided their consent to participate in second phase of allotment i.e., opted to continue with the booking when the OP had given option of refund of the deposited amount. OP No.1 on 01.09.2011 conducted next draw of lots, accordingly OP No.1vide letter dated 06.10.2011 allotted unit no. PA-243-FF / Area (tentative) 1,025 sq. ft. to the complainants. Thereafter, on 10.04.2012 FBA was executed between the Complainants and the OPs.All the representations made by the OP No.1 including tentative timelines for possession and penalty payable by the OP No.1 in case of delay in offering possession were duly documented in the terms and conditions of the Booking Form which were reiterated in the FBA.The Complainants on account of thorough reading and understanding of the clauses and/or recitals of the FBA agreed and accepted to abide by the same and, affixed their signature as token of acceptance without raising any demur or protest. The Complainants did not at any stage
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raise any issue/s and/or grievances towards any of the incorporated terms and conditions of FBA.
The Complainants have concealed that the Complainants had materially breached the terms of agreement executed between the parties by making huge defaults in making timely payment of the various installments called from time to time by the O.P. from the Complainants. Vide Clause 11 of the Booking Application which was later reiterated vide Clause 7 of the FBA, the Complainant had agreed and accepted that timely payment of each installment was a material condition of this transaction. Despite having agreed to the said clauses, the Complainants started defaulting in making timely payments since the beginning. The OP gave detailed narration and annexed various demand letters, reminder letters, last and final opportunity letters and emails which were issued to the Complainants from the year 2012 till 2018 where after, the OP issued Notice of Termination dated 17.09.2018 and 19.11.2018 to the Complainant thereby terminating the booking/ allotment.
With respect to Club, it was submitted that presently, 2 interim clubs, one in Block-T and Block-F in the Township Parklands are already operational and functional.
On the aspect of delay, it was submitted that while determining tentative time for delivery of possession of the Unit as per the Agreement, the delay in construction was beyond the control of OP No.1. It is well settled law that “force majeure” indicates events which are beyond the control of human being and prevents other party from performing its contractual obligations. In the facts of the case, OP No.1 is entitled to claim exception under the shelter force majeure events in as much as it was due to the delay in decisions taken by government agencies that OP No.1 was incapacitated in completing construction within time. It was further submitted that the Complainants have referred to incomplete clauses and importing incorrect meaning to
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the various incorporated clause/s of the duly executed FBA dated 10.04.2012 with the sole intent to misrepresent the clause/s qua proposed timelines. As per the terms and conditions of the FBA, the OP No.1 proposed to offer the physical possession of the unit within a period of 24 months from the date of execution of the FBA, with a further grace period of 6 months, subject to adherence to the other material terms and conditions of the FBA. The remedy in case of delay in offering possession of the unit was also agreed to between the parties as also extension of time for offering possession of the floors. Clauses 5.1, 5.3, 5.6 and 14 (force majeure) were reproduced
It was also submitted that upon entering the transaction with the OP No.1, the Complainants became 1/3rd owner of the plot which is worth Rs.70 Lacs approx., the Complainants are yet to make payment of remaining total sale consideration for the unit in question. It is further submitted that the civil construction of the unit no. PA-243-FF stands completed for a long time and, as a matter of fact the timelines for possession were subject to force majeure circumstances and for reasons beyond the control of the OP No.1, the tentative timelines stood diluted. In this context, it was stated that in terms of Notification dated 16.03.2010 of Self Certification Scheme issued by the Town and Country Planning Department, Government of Haryana, OP No. 1 applied for approval of building plans under the Self Certification Scheme. Although, no objection was received from the Department, however, to ensure that there are no problems later, the OPs also applied for approval of building plans under the regular scheme. In few cases, approval under the regular scheme was received from the Department, but neither approval nor non approval of the Department was received against the Application under Self Certification Scheme, thus, OP No. 1 continued the Internal Development Works and simultaneously raised construction on the plots which was in consonance with the prevailing Building Bye laws considering plans to be deemed approved. However, there was no clarity in the policy of self-certification to the effect whether the same is applicable to individual plot owners only and excludes the developers / colonizers or
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whether the same is applicable to the developers/ colonizers as well. Subsequently, the Department vide public notice dated 08.01.2014 granted time of 90 days to submit requests for regularization of construction. Accordingly the OPs submitted approval under the said notice. The Department however still had the ambiguity as to whether the policy of self-certification applies to individual plot owners or developers/ colonizers and due to such ambiguities in various policies, construction of the project was delayed time and again. Thereafter, the Department vide its order dated 08.07.2015 finally clarified that self-certification policy shall also apply to cases of approval of building plans submitted by colonizer / developer but did not formally released all the plan submitted by the OPs time to time in various building plan approval schemes.In the meanwhile, OP continued with internal development works. In this manner, reason for delay was put forward by the OP. It was also stated that the OP No.1 has already handed over large no. of units in the project ‘Park Elite Floors’ to its respective allottees and is committed to handover the remaining units at the earliest in a phased manner. It was also submitted that the Complainants never raised any objection and/or protested against the agreed rate of compensation under Clause 5.3 of the FBA. It was further submitted that OP No. 1 is committed to provide operational amenities and facilities in terms of FBA. With respect to Stamp Duty and Registration charges, it was submitted that vide Clause 2.9 read along with Clause 22 & Clause 23, no amount towards stamp duty, registration charges or other incidental charges were agreed between the parties. However, the Complainant agreed to bear the said charges for execution and registration of the Conveyance Deed with respect to unit in dispute as and when demanded by the OP No.1. Opposite Parties denied rest of the allegations levelled in the Complaint and prayed for dismissal of the Complaint.
- The parties led evidence in support of their respective versions.
- We have heard the learned counsel for the parties and have gone
through the record on the file.
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6. In this case, the Complaint was filed by the Complainant against the Opposite Parties –BPTP with the prayer to: a) deliver possession of the apartment along with registered conveyance and Occupation Certificate to the Complainant along with compensation for delay calculated @18% PA on amounts paid by the Complainant b) In the event stamp duty and registration charges at the time of registration of conveyance are higher than the rate applicable on the promised date of possession, OP should compensate the excess amounts that Complainant will have to pay for stamp duty and registration c) to revoke and cancel demand under the head “Club Membership Charges” and refund the amount already recovered earlier with interest @18% pa. d) to pay a sum of Rs.10,00,000/- to compensate the Complainant for non-provision of promised amenities e) To pay a sum of Rs.10,00,000/- by way of mental harassment and suffering and unfair trade practices f) to pay a sum of Rs.50,000/- as litigation expenses g). Such other relief that this Hon’ble Commission may deem appropriate in the interest of justice.
To establish his case, the Complainant has led in his evidence Ex. CW1/A-Affidavit of Pushkar Rana, Ex. C1 (referred to as Annexure-1)-Copy of Brochure, Ex. C 2 (referred to as Annexure-2)-Copy of FBA, Ex. C 3 (referred to as Annexure-3)-Copy of Statement of Account dated 22.01.2020 and receipts issued by OP, Ex. C 4 (referred to as Annexure-4)-Copy of Notification issued by Government of India Ministry of Water Resources dated 26.12.2000, Ex. C 5 (referred to as Annexure-5)-Copy of email dated 05.06.2015, Ex. C 6 (referred to as Annexure-6)-Copy of email dated 19.06.2015, Ex. C 7 (referred to as Annexure- 7)-Copy of email dated 22.06.2015, Ex. C 8 (referred to as Annexure-8)-Copy of email dated 25.06.2015, Ex. C 9 (referred to as Annexure-9)-Copy of emails dated 30.06.2015 and 07.07.2015, Ex. C 10 (referred to as Annexure-10)-Copy of email dated 30.07.2015, Ex. C 11 (referred to as Annexure-11)-Copy of email dated 30.07.2015, Ex. C12 (referred to as Annexure-12)-Copy of email dated 19.07.2015, Ex. C 13 (referred to as Annexure-13)-Copy of email dated 30.10.2015, Ex. C 14 (referred to as
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Annexure-14)-Copy of email dated 24.12.2015, Ex. C 15 (referred to as Annexure-15)-Copy of email dated 05.06.2016, Ex. C 16 (referred to as Annexure-16)-Copy of email dated 27.06.2016, Ex. C 17 (referred to as Annexure-17)-Copy of email dated 30.06.2016, Ex. C 18 (referred to as Annexure-18)-Copy of email dated 01.03.2018, Ex. C 19 (referred to as Annexure-19)-Copy of email dated 05.03.2018, Ex. C 20 (referred to as Annexure-20)-Copy of email dated 05.03.2018.
On the other hand, AR of the Opposite Parties strongly agitated and opposed the case of the Complainant. As per the evidence of the Opposite Parties, EX. RW1/A-Affidavit of Jay Shankar, Authorized Representative of the Opposite Parties, Ex. R/1(Colly)-resolutions, Ex. R 1- Application for Allotment by sale of a residential independent floor at Parklands, Faridabad, Ex. R 2- Letter dated 31.12.2009, Ex. R 3-letter dated 09.07.2011, Ex. R 4- Consent letter and Allotment letter dated 06.10.2011, Ex. R 5- Flat Buyers Agreement dated 10.04.2012, Ex. R6- reminder letter dated 09.01.2013, demand cum reminder letter dated 08.02.2013, reminder letters dated 08.02.2013 & 11.03.2013, demand cum reminder letters dated 13.03.2013 & 12.04.2013, final opportunity letter dated 15.04.2013, receipt dated 27.04.2013, demand letter dated 05.07.2013, reminder letters dated 22.07.2013, 21.08.2013 & 20.09.2013, final opportunity letter dated 29.10.2013, email dated 04.12.2015, VAT demand letter dated 10.11.2016, reminder letters dated 27.12.2017, 20.02.2018 & 09.04.2018, VAT reminder vis emails dated 28.03.2017, 12.05.2017, 12.10.2017 & 18.06.2018, final opportunity letters dated 31.07.2018 & 18.09.2018, Ex. R/2(Colly)- snaps of Club in T Block and F Block, Ex. R7- Notification dated 16 March,2010, Ex. R 8- Public Notice dated 08.10.2014, Ex. R 9- Order dated 08.07.2015.
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8. In this case, it was argued by the counsel for the Complainant that the unit in question is still not ready and possession has not been offered. It was further argued that the main grievance of the Complainant is that there is delay in completion and delivery of flat, and therefore they seek the relief of possession with OC and registered conveyance and delay compensation at adequate rates, reversal of club membership charges and ancillary relief. It was further argued that in terms of Floor Buyers Agreement dated 10.04.2012 executed between the Complainants and the OP, timelines for possession were 24 months + 6 months from the date of execution of the Agreement and hence, there is a huge delay of 8 to 10 years. The possession clause specifies delay penalty of only Rs. 5 psf pm which translates to only 2-3% PA SI. In contrast OP charges @ 18% PA compounded for delay in payment. Judgments passed by Hon’ble Supreme Court were referred to the effect that adequate delay compensation ought to be given and not mere meagre rate specified in the FBA. With respect to the issue that the allotment was already terminated, it was argued that the Complainant had already paid about 76% of the sale consideration, the last payment made on 27.4.2013, much after the due date of possession and that purported termination letter was issued on 17.09.2018 & 19.11.2018 but the same has no legal effect because there was no intention to terminate, statement of account dated 20.01.2020 (was issued by OP showing that it continued to treat the FBA in force and the
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termination was unjustified since there was no evidence of construction and banks were refusing loans because OP had not obtained sanctions. It was also argued that none of the facilities like shopping centres, schools, community centre, health club etc., as advertised have been constructed and that the OP in the reply admits that only an interim club is provided and the facilities would be constructed in future. Instead of providing club over an area of 2 acres land, they have converted one of the vacant units into a temporary club. It was further argued that the OPs plea of force majeure were untenable. In passing reference was made to other issues like Super Built Up Area increase, cost escalation, Electricity connection charges which were demanded from other customers when possession was offered to them.
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communicated to the Complainant that for plot size 180 sq. yards (for which the Complainant applied for at the stage of booking), tentative floor super built up area as offered in second phase of allotment would be 1,025 sq. ft. instead of 876 sq. ft. and, the basic sale price for increased area (difference between the super built up area mentioned in the booking application and the revised super built up area as mentioned hereinabove) is priced at Rs.2,425 per sq. ft. On receipt of said letter dated 09.07.2011, the Complainants after weighing both the options, chose to give their consent to participate in second phase of allotment and thus, the issue of Super Built Up Area being raised is not maintainable and is an afterthought. With respect to Club charges, it was submitted that vide Clause 1.5 (e) of the duly executed FBA, Complainants had agree to pay a sum of Rs.50,000/- towards Club and that presently, 2interim clubs, one in Block-T and Block-F in the Township Parklands are already operational and functional, which are being utilized by the allottees on daily basis.With respect to other charges, it was stated that there were specific clauses in the FBA whereby the Complainants had agreed to pay the same as and when demanded by the OP and now at this juncture complainant cannot be allowed to challenge the said heads of payment. On the query raised as to why the statement of account was issued in the year 2020, it was stated that it was a system generated statement and would have been issued by mistake and complainant cannot be allowed to take the benefit of this. However, after termination no demands were raised on the Complainant. The AR of the OP also referred judgments for forfeiture of earnest money and misrepresentation and thus, playing fraud on court because nowhere in the complaint this fact has been disclosed that due to non-payment, OP has terminated the unit of complainant.
10. On raising the query from the OP as to whether there was any issue regarding bank loan for these floors, the AR of the OP referred to the Application filed by him for additional Affidavit and documents exhibited therein.
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- LRs., vs. BishunNarain Inter College [AIR 1987 SC 1242], wherein it was held as follows-:
“It is well settled that in the absence of pleading, evidence, if any, produced by the parties cannot be considered. It is also equally settled that no party should be permitted to travel beyond its pleading and that all necessary and material facts should be pleaded by the party in support of the case set up by it. The object and purpose of pleading is to enable the adversary party to know the case it has to meet. In order to have a fair trial it is imperative that the party should state the essential material facts so that other party may not be taken by surprise. The pleadings however should receive a liberal construction, no pedantic approach should be adopted to defeat justice on hair splitting technicalities. Sometimes, pleadings are expressed in words which may not expressly make out a case in accordance with strict interpretation of law, in such a case it is the duty of the court to ascertain the substance if the pleadings to determine the question. It is not desirable to place undue emphasis on form, instead the substance of the pleadings should be considered. Whenever the question about lack of pleading is raised the enquiry should not be so much about the form of pleadings, instead the court must find out whether in substance the parties knew the case and the issues upon which they went to
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trial. Once it is found that in spite of deficiency in the pleadings, parties knew the case and they proceeded to trial on those issue by producing evidence, in that event it would not be open to a party to raise the question of absence of pleadings in appeal."
13. In view thereof, we are not inclined to look into such portions of evidence and supporting documents which were not part of the Complaint filed before us.Similarly, the Application filed by the OP for additional evidence is also dismissed and the said Additional Affidavit is not taken on record.
14. Before delving into the merits of the case, we deem it appropriate to adjudicate the preliminary objections raised on behalf of the Opposite Parties.
WHETHER THE COMPLAINANT HAS NOT APPROACHED THIS COMMISSION WITH CLEAN HANDS?
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16. It is settled position in law that if an applicant does not disclose full facts or suppresses relevant materials or is otherwise guilty of misleading the Court, then such an act would disentitle him from any relief.
- In S.P Chengalvaraya Naidu vs Jagannath, 1994 SCC (1) 1, the Hon'ble Supreme Court, while dealing with a case where a release deed was suppressed, came down heavily upon such tactics of litigants. It observed that the non- mentioning and non-production of the release deed amounted to "playing fraud upon the court" and concluded that:
"6. ...A litigant, who approaches the court, is bound to produce all the documents executed by him which are relevant to the litigation. If he withholds a vital
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document in order to gain advantage on the other side then he would be guilty of playing fraud on the court as well as on the opposite party.”
18. In Dalip Singh vs. State of Uttar Pradesh and others (2010) 2 SCC 114, the Hon'ble Supreme Court considered the question whether relief should be denied who did not state correct facts in the application filed before the prescribed authority and who did not approach the High Court with clean hands, observed that while exercising discretionary and equitable jurisdiction, the facts and circumstances of the case should be seen in their entirety to find out if there is miscarriage of justice. If the appellant has not come forward with clean hands, has not candidly disclosed all the facts that he is aware of and he intends to delay the proceedings, then the Court will non-suit him on the ground of contumacious conduct.
- In MohammaedSoyab v/s UOI,(Review Petition No. 85 of 2016 decided on 25.05.2017), the Hon’ble Himachal Pradesh High Court held as follows-
“32.1 Courts have, over the centuries, frowned upon litigants who, with intent to deceive and mislead the Courts, initiated proceedings without full disclosure of facts and came to the courts with 'unclean hands'. Courts have held that such litigants are neither entitled to be heard on the merits of the case nor entitled to any relief.
32.4. Quests for personal gains have become so intense that those involved in litigation do not hesitate to take shelter of falsehood and misrepresent and suppress facts in the court proceedings. Materialism, opportunism and malicious intent have over-shadowed the old ethos of litigative values for small gains.
32.5. A litigant who attempts to pollute the stream of justice or who touches the pure fountain of justice with tainted hands is not entitled to any relief, interim or final.
32.6. The Court must ensure that its process is not abused and in order to prevent abuse of the process the court, it would be justified even in insisting on
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furnishing of security and in cases of serious abuse, the Court would be duty bound to impose heavy costs.
37. The person seeking equity must do equity. It is not just the clean hands, but also clean mind, clean heart and clean objective that are the equifundamentals of judicious litigation. The legal maxim jure naturae aequumestneminem cum alteriusdetrimento et injuria fierilocupletiorem, which means that it is a law of nature that one should not be enriched by the loss or injury to another, is the percept for Courts. Wide jurisdiction of the court should not become a source of abuse of the process of law by the disgruntled litigant. Careful exercise is also necessary to ensure that the litigation is genuine, not motivated by extraneous considerations and imposes an obligation upon the litigant to disclose the true facts and approach the court with clean hands.
38. No litigant can play 'hide and seek with the courts or adopt 'pick and choose'. True facts ought to be disclosed as the Court knows law, but not facts. One, who does not come with candid facts and clean breast cannot hold a writ of the court with soiled hands. Suppression or concealment of material facts is impermissible to a litigant or even as a technique of advocacy. In such cases, the Court is duty bound to discharge rule nisi and such applicant is required to be dealt with for contempt of court for abusing the process of the court. [K.D. Sharma v. Steel Authority of India Ltd. &Ors., 2008 12 SCC 481].
20. It is apparent that the Complainant attempted at misleading this Commission by pleading that the Complainant had paid all demands raised by the OP while the truth is otherwise. Even after receiving the Written Statement where it was specifically pointed out that on account of delay in payments, booking/ allotment was terminated, the Complainant continued with his stand in his
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evidence that he had duly paid all demands raised by OP but subsequently attempted at justifying the delay but the fact remains that a false statement was made on oath. Hence, on this ground alone, the Complaint is liable to be dismissed with exemplary costs. However, taking a lenient view, we are not dismissing the Complaint.
WHETHER COMPLAINANTS FALL IN THE CATEGORY OF ‘CONSUMER’ UNDER THE CONSUMER PROTECTION ACT, 2019
21. The Opposite Parties have contended that the complainants are not Consumer as defined under the Consumer Protection Act, 2019 as the flat was purchased for investment i.e. for commercial purpose.
22. It is imperative to refer to the dicta of the Hon’ble National Commission in CC-1122/2018 titled Narinder Kumar Bairwal and Ors vs Ramprastha Promoters and Developers Pvt. Ltd. and Ors. Decided on 01.11.2019, wherein, the Hon’ble National Commission has held as under:
“19 The contention of the Learned Counsel that the said Flats were purchased for commercial purpose is not supported by any documentary evidence as the onus shifts to the Opposite Parties to establish that the Complainant have purchased the same to indulge in ‘purchase and sale of flats’ as was held by this Commission in Kavit Ahuja vs Shipra Estate I (2016) CPJ 31. The Opposite Parties failed to discharge their onus and we hence that the Complainant the ‘Consumer’ as defined under Section 2 (1) (d) of the Act.”
23. Form the aforesaid dicta of the Hon’ble National Commission, it flows that it is for the Opposite Party to prove that the unit purchased was for
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commercial purpose, by way of some documentary proof and a mere bald statement is not sufficient to raise adverse inference against the complainants.
24. In the present case, the Opposite Party has merely made a statement that the complainants have purchased the unit for commercial purpose and on perusal of the record before us, we fail to find any material which shows that the complainants are engaged in the business of purchasing and selling houses and/or plots on a regular basis, solely with a view to make profit by sale of such flats. Mere allegation, that the purchase of the property is for commercial purpose, cannot be the ground to reject the present consumer complaint. Consequently, the objection raised on behalf of the Opposite Parties in answered in the negative.
WHETHER THE COMPLAINANTS HAVE CAUSE OF ACTION TO APPROACH THIS COMMISSION?
25. The next issue to be adjudicated is whether the complainants have cause of action to approach this commission. It is imperative to refer to Section 69 of the Consumer Protection Act, 2019 wherein it is provided as under:-
“69. Limitation period.-
- The District Commission, the State Commission or the National Commission shall not admit a complaint unless it is filed within two years from the date on which the cause of action has arisen.
- Notwithstanding anything contained in sub-section (1), a complaint may be entertained after the period specified in sub-section (1), if the complainants satisfies the District Commission, the State Commission or the National Commission, as the cases may be, that he had sufficient cause for not filing the complaint as this such period:
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Provided that no such complaint shall be entertained unless the National Commission, the State Commission or District Commission, as the case may be, records its reasons for condoning such delay.”
26. Thus, this Commission is empowered to admit a complaint if it is filed within a period of 2 years from the date on which cause of action has arisen. The issue to be considered is whether cause of action was subsisting on the day when the Complaint was filed before us?
27. As per the Opposite Parties, they had terminated the booking/ allotment vide letter dated 17.09.2018/19.11.2018. However, admittedly, no amount was refunded to the Complainants. Without deciding at this stage whether the termination is valid or not, even going by the stand of Opposite Parties, in view of non-refund, the cause of action is continuing to approach this Hon’ble Commission.
28. Now we come to the merits of the case.
The issue to be decided by us is whether the Complainants are entitled to seek possession of the unit despite issuance of Notice of Termination and whether the OP are guilty of Deficiency in Services?
29. In this context, it is pertinent to point out that it has not been denied by the Complainant that notice of Termination dated 17.09.2018 and 19.11.2018 were issued to the Complainant and that even after receipt of the said Notices, the Complainants did not come forward to make payment of the outstanding dues. In fact, the Complainants neither disclosed this fact in the Complaint nor sought withdrawal of the said Notices of Cancellation. Hence, in this background, the said
Consumer Complaint No.393/2020.
Notice of Termination attained finality and the booking/ allotment stood terminated.
30. We also enquired from the AR of the OP regarding the status of construction and by when would the unit be ready for handover. However, he was not able to come up with any timelines and submitted that the unit was still under construction.
31. Going by thestand of the OP as stated above and the fact that it is the admitted case of the Complainants that while OP had represented to the Complainants that there would be organized green landscaped areas, kids park, jogging and walking track, sitting areas, adequate street lighting and open area lighting and further that the Parklands Township has its own schools, hospitals, local shopping centers and fully developed roads, street lighting, sewerage system, water connection, drainage, children’s parks and 24*7 security system but none of these amenities are developed and in fact, even the extremely basic amenities like roads are not developed yet, it is apparent that the delay in the Project is beyond reasonable time and rather is abnormal and unexpected which frustrates the contract as it causes fundamental breach.
32. In view of the above facts, it would also be prudent to see if the OPs have been deficient in providing services to the Complainants. The expression Deficiency of Service has been dealt with by the Hon’ble Apex Court in Arifur Rahman Khan and Ors. vs. DLF Southern Homes Pvt. Ltd. and Ors. reported in 2020 (3) RCR (Civil) 544, wherein it has been discussed as follows:
“23…………The expression deficiency of services is defined in Section 2 (1) of the CP Act 1986 as:
Consumer Complaint No.393/2020.
(g) “deficiency” means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service.
24.A failure of the developer to comply with the contractual obligation to provide the flat to a flat purchaser within a contractually stipulated period amounts to a deficiency. There is a fault, shortcoming or inadequacy in the nature and manner of performance which has been undertaken to be performed in pursuance of the contract in relation to the service. The expression service in Section 2 (1) (o) means a service of any description which is made available to potential users including the provision of facilities in connection with (among other things) housing construction. Under Section 14(1) (e), the jurisdiction of the consumer forum extends to directing the opposite party inter alia to remove the deficiency in the service in question intrinsic to the jurisdiction which has been conferred to direct the removal of a deficiency in service is the provision of compensation as a measure of restitution to a flay buyer for the delay which has been occasioned by the developer beyond the period within which possession was to be handed over to the purchaser. Flat purchasers suffer agony has harassment, as a result of the default of the developer. Flat purchasers make legitimate assessments in regard to the future course of their lives based on the flat which has been purchased being available for use and occupation. These legitimate expectation are belied when the developers as in the present case in guilty of a delay of years in the fulfilment of a contractual obligation.
Consumer Complaint No.393/2020.
33. At this stage, we deem it appropriate to refer to clause 5.1 of the FBA dated 10.04.2012 entered into by both the contesting parties. Clause 5.1 of the FBA, reflects that the Opposite Party was bound to deliver the possession of the said unit within 24 months from the date of execution of FBA with 6 months grace period while admittedly, the unit is still not ready.
34. We deem it appropriate to refer to Aashish Oberai vs Emaar MGF Land Limited reported in I (2017) CPJ 17 (NC), wherein the Hon’ble National Commission has held as under:
“I am in agreement with the learned senior counsel for the complainants that consideration the default on the part of the opposite party in performing its contractual obligation, the complainant cannot be compelled to accept the offer of possession at the belated stage and therefore, is entitled to refund the entire amount paid by him along with reasonable compensation, in the form of interest.”
35. Relying on the above settled law, we hold that the Opposite party is deficient in providing its services to the complainants as the Opposite party had given false assurance to the complainants with respect to the time for delivery of possession of the said Unit and kept the hard earned money of the complainants for about 10 years. Moreover, the Opposite Party failed to handover the possession of the said unit to the complainants within the stipulated time period and therefore, now the complainants are not bound to take the possession of the said unit after the stipulated period.
36. Now on one hand, the Complainants were at fault in not making timely payments which resulted in termination of the booking/ allotment and
Consumer Complaint No.393/2020.
hence, they are not entitled to seek possession and on the other hand, the OPs were also at fault in not completing the construction in time.
Thus, the question which arises for our consideration is that can the OP forfeit earnest money or should the money be refunded?
37. In Maula Bux Vs. Union of India – 1969 (2) SCC 554, the Hon’ble Supreme Court quoted the following observations made by the Judicial Committee in Kunwar Chiranjit Singh Vs. Har Swarup – AIR 1926 PC 1 –
“Earnest money is part of the purchase price when the transaction goes forward; it is forfeited when the transaction falls through, by reason of the fault or failure of the vendee”.
38. In Shree Hanuman Cotton Mills &Ors. Vs. Tata Air Craft Ltd. – 1969 (3) SCC 522, the Hon’ble Supreme Court quoted the following characteristics of the earnest money –
“15. Borrows, in Words & Phrases, Vol. II, gives the characteristics of "earnest". According to the author, "An earnest must be a tangible thing. That thing must be given at the moment at which the contract is concluded, because it is something given to bind the contract, and, therefore, it must come into existence at the making or conclusion of the contract. The thing given in that way must be given by the contracting party who gives it, as an earnest or token of good faith, and as a guarantee that he will fulfil his contract, and subject to the terms that if, owing to his default, the contract goes off, it will be forfeited. If, on the other hand, the contract is fulfilled, an earnest may still serve a further purpose and operate by way of part payment."
Consumer Complaint No.393/2020.
39. After considering several decisions on the subject, the following principles were laid down by the Hon’ble Supreme Court regarding ‘earnest’:
- It must be given at the moment at which the contract is concluded
- It represents a guarantee that the contract will be fulfilled or, in other words, 'earnest' is given to bind the contract.
- It is part of the purchase price when the transaction is carried out.
- It is forfeited when the transaction falls through by reason of the default or failure of the purchaser.
- Unless there is anything to the contrary in the terms of the contract, on default committed by the buyer, the seller is entitled to forfeit the earnest”.
40. In MohammaedSoyab v/s UOI, the Hon’ble High Court held as follows-
“While adjudicating, the courts must keep the following principles in view-
- It is the bounden duty and obligation of the court to neutralize any unjust enrichment and undeserved gain made by any party by invoking the jurisdiction of the court.
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6. A party cannot be allowed to take any benefit of his own wrongs.
7. Litigation should not be permitted to turn into a fruitful industry so that the unscrupulous litigants are encouraged to invoke the jurisdiction of the court.”
41. It would thus be seen that only a ‘reasonable amount’ can be forfeited as earnest money in the event of default on the part of the purchaser and it is not permissible in law to forfeit any amount beyond a reasonable amount, unless it is shown that the person forfeiting the said amount had actually suffered loss to the extent of the amount forfeited by him.
Consumer Complaint No.393/2020.
42. In our opinion, 25% of the Total sale consideration cannot be said to be a reasonable amount which the OP Company could have forfeited on account of default on the part of the complainant unless it can show it had only suffered loss to the extent the amount was forfeited by it. In our opinion, in absence of evidence of actual loss, forfeiture of any amount exceeding 10% of the sale price cannot be said to be a reasonable amount. However, considering that even OP were deficient in providing services, no amount is allowed to be deducted.
43. The other issues raised by the Complainants like Super Built Up Area increase, escalation, electrical connection charges etc., become irrelevant once the relief been granted is refund and not possession, hence the said issues are not been dealt with.
44. There are lot of settled cases in which the prayer of the consumer was different and the Commission/Court decided in the different way. After hearing both of the parties and evidence led by the parties, the counsel for the opposite parties stated at Bar during the course of arguments due to Covid-19 and strict laws laid down by RERA, it is hard to survive for the builder/developer. In these 10 cases/complaints, there is no occupation certificate received by the opposite parties till yet and they can not assured the date for the issuance of occupation certificate. The A.R of the opposite parties has suffered a separate statement that “We are ready to refund the deposited amount to the complainant as per Flat Buyer’s Agreement Clause 6.4.”
45. We have heard the parties & appraised the material on record carefully & now the Commission is of the opinion that due to any reason whatsoever the whole or part of the project in question is abandoned or the completion of the project is delayed due to any reasons, the responsibility and
Consumer Complaint No.393/2020.
liability of the opposite parties/seller will be to refund to the complainant/purchaser(s) the total amount as may be received by the seller.
46. Hence, In the interest of justice, these all 10 complaints are disposed off with the direction to opposite parties to refund the entire money paid by the Complainants along with interest @ 6% p.a. from the date of each deposit respectively till the date of payment within 60 days of the receipt of this order.
47. In case the order is not complied with within the next 60 days from the date of receipt of the copy of the order, the rate of interest will increase from 6% to 9% p.a. for the period beyond that till the date of realization of the payment. Opposite parties are also directed to pay Rs.3300/- as compensation for mental tension and agony and also to pay Rs.2200/- as litigation expenses to the complainants. Compliance of this order be made within 60 days from the date of receipt of the copy of this order. Copy of this order be sent to the parties concerned free of costs. File be consigned to the record room.
Announced on: 28.02.2022. (Amit Arora)
President
District Consumer Disputes
Redressal Commission, Faridabad.
(Mukesh Sharma)
Member
District Consumer Disputes
Redressal Commission, Faridabad.
( Sujata Pruthi)
Member
District Consumer Disputes
Redressal Commission, Faridabad.
