BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION AT BANGALORE (URBAN)

DATED 30^TH DAY OF NOVEMBER 2022

ORDER

SMT.M.SHOBHA, PRESIDENT

1. This  complaint has been filed by the complainants  for the  following reliefs

1. To direct the OP to refund the purchase amount  paid by the complainants Rs.5,26,443/- along with interest at the rate of 21% from the date of making payment.
2. Further direct the OP to pay sum of Rs.1,00,000/- as compensation to the complainants.
3. Further direct the OP to pay sum of Rs.1,00,000/- to the complainants towards damages for deficiency of service for illegal claim, mental torture etc.
4. Grant  such other reliefs deemed fit and proper under the circumstances of the case in the interest of justice and equity.

2. The case of the complainants is that:

They booked the flat in the project of the OP company and they have provisionally allotted flat GADAQG401 for total sale consideration of Rs.86,61,520/-. The OP company assures that the said project will be completed in time and as such complainants have booked the flat on 16.02.2019 after paying advance amount. The OP have also issued allotment letter to the complainants  and they have promised  to execute necessary documents in favour of  the complainants,  for loan purpose it was proposed to SBI Bank. 

It is specific grievance of the complainants  that after receiving the part of sale consideration by OP company they promised complainants that project will be completed as per  terms agreed between them and the complainants and there are no litigations pending in the said project and loan will be easily available from the SBI and said assurance and promises the complainants agreed to purchase the said flat from the OP company.

It is further grievance of the complainants that they have approached the SBI bank for loan, but the bank refused for any loan on the OP project stating that there is civil dispute pending between the original land lords, the Sammy Dreamland Pvt. Ltd. Who are the vendors of OP. Until civil disputes are settled the loan cannot be sanctioned and also OP company is also made as party in the said suit, same was intimated to the OP company and several discussions and emails communications between the OP company and complainants,  the complainants have decided that unless the civil suit is going on, they cannot get any loan from the SBI bank. As such OP company  either has to settle the civil dispute or make arrangements to refund amount received and the interest paid by the complainants  by OP company and damages incurred by the complainants.

It is further grievance of the complainants that the OP company instead of clearing civil dispute they suggested the complainant to approach  some other bank. When the complainants stated that in event of complainants want to sell after purchase of flat, if the civil suit is pending then they will not be in a situation of disposing of the property and they will be held up in unnecessary civil dispute and it will continue for years. Unless civil disputes are cleared the complainants cannot make further payment for purchase of the flat from the OP company. No response from the OP company regarding of clearance of cases.

It is further grievance  of the complainants that all of a sudden pre-termination letter dt.17.10.2019 was issued by the OP company to the complainants to pay further installments and interest  etc., which is totally unwanted demand when the civil dispute is there, the complainants are not able to get loan for purchase of flat, which was very much intimated to the OP company. The complainants have purchasing the flat on loan from the bank if every thing is clear. It is further grievance of the complainants that  definitely they are ready to purchase the flat or in event of OP company failing to settle civil dispute pending before Hon’ble Court on the said land mentioned in the project.

It is further grievance of the complainants that they have again received another termination notice from the OP company. After that the complainants have issued legal notice dt.26.02.2020 and explained about the events in which the complainants are not able to make further payment unless bank approves loan for purchase of flat and since the civil suit is pending against the OP and others. If the civil suit is not closed, the bank will not approve loan for purchase of flat. The complainants cannot get any loan as such they are not in a position to make further payments. The complainants sent several mails to the concerned authority of OP asking to clear civil disputes, but there is no response from the OP company. OP company instead of clearing disputes they have terminated the booking of flat itself arbitrarily  even though they have admitted they did not gave  details of pending cases in RERA of civil dispute for technical reason and now they have updated about civil disputes.  This admission of the OP itself clearly shows deficiency of service towards consumers by OP company.

It is further case of the complainants that they have repeatedly demanded the OP company for  refund of the advance amount, but OP company have not refunded the amount. Hence, this complaint.

3.  After filing of the complaint, notice was issued to the OP. OP remained absent and placed exparte. Hence, case was posted for adducing evidence of the complainants.

4.  The complainants in support of their complaint have filed affidavit of complainant no.1 and relied an exhibits P1 to P9 documents.

5. Heard arguments of the complainants.   

6. The following points do arise for our consideration:-

1. Whether the complainant established  deficiency in service on the part of the OP?
2. Whether the complainants are entitled for the reliefs claimed in the complaint ?
3. What order?

7. Our answer to the above points are as under:

       Point No.1:- Affirmative

      Point no.2:- Affirmative in part

      Point No.3:-As per the final order.

REASONS

8. Point No.1 and 2: The evidence of the complainants and documents relied by the them are not challenged by the OP, since the OP company was placed exparte. Under these circumstances there is no reasons to disbelieve the allegations made in the complaint and the documents produced by the complainants.

9.   The complainants have booked flat in the OP proposed project and the OP company have provisionally allotted GDAQG401 and received advance amount of Rs.5,26,443/-. The complainants have agreed to purchase the flat for total consideration of Rs.86,61,520/-. The complainant have approached the SBI bank for loan as per instructions of the OP company for rising loan, but the SBI has refused to grant any loan on the proposed project of the OP on the ground that there is civil dispute pending between the original land lords Sammy Dreamland Pvt Ltd., who are the vendors of the OP company and bank informed that until civil suit are settled the loan cannot be sanctioned and  OP was also made as party in the said suit. After that the complainants have intimated the same to the OP company and after several discussions and several e-mails between the OP company and the complainants, the complainant have also informed the OP company that they will not get any loan from any bank until civil suit are settled. They have also informed the OP to clear the civil  dispute or made arrangements to refund amount  received from them  and pay interest and damages.

10. It is further grievance of the complainants that the complainants insisted the OP company  for clearance of civil disputes and they also suggested the complainants to  approach other banks. All of a sudden they have issued termination letter dt.17.10.2019 calling upon the complainants to pay further installments and interest etc. Inspite of intimation given to the OP and  inveiw of the civil dispute they are unable to get the loan from any bank. When the OP has failed to clear the disputes, the complainants have decided to claim the advance amount paid by them. Inspite of  repeated demands and requests the OP company failed to refund the advance amount. Then the complainants have issued legal notice on 26.02.2020. Inspite of service of legal notice OP neither complied the demands made by the complainants or issued any reply to the complainants.

11. In support of their contention, they have produced Ex.P2 i.e. application dt.16.02.2019 for booking of the flat. Ex.P3 is copy of the detailed statement regarding payment made by the complainants to the OP. Ex.P4 is bunch of emails correspondence between the complainants and OP. Ex.P5 is pre-termination letter dt.17.10.2019. Ex.P6 is statement of accounts. Ex.P7 is copy of legal notice. Ex.P8 is reply notice. Ex. P9 is postal receipts and acknowledgments.

12. The complainant also produced order passed by the Sr.Civil Judge & JMFC, Devanahalli, in OS.73/2019 dt.01.10.2020. The learned judge passed order on IA-3 & 4 filed under order 7 Rule 11 of CPC. In this order the 6^th defendant who is the OP in this complaint have filed application for rejection of the plaint in the said suit. The applications filed by the 6^th defendant was rejected by the court vide order dt.01.10.2020 and OS.73/2019 is still pending before the Hon’ble Sr.Civil Judge and JMFC, Devanahalli. In view of this, it is clear that the litigation related to the lands involved in the OP project is still pending. In view of this the complainants are unable to get any loan from any bank. Under these circumstances, the complainants have decided to request the OP to refund the amount with interest. When the OP company unable to give litigation free property to the complainants, it is the duty of the OP to refund the amount. When the banks are not inclined to sanction any loan to the project initiated by the OP company, the complainants cannot continue with the purchase of property which is involved in the litigation. Under such circumstances decision taken by the complainants is proper and correct. It is very difficult for common man to purchase property worth Rs.86,61,520/- without the assistance of the bank loan  or any financial institution. When the financial institutions are not ready to sanction loan in respect of property involved in the civil litigation. It is very difficult to get loan from the any other institution. It is the  responsibility of the OP to clear the disputes and then they have to enter into agreement with the proposed purchasers in the project initiated by them. The OP have proceed to collect money  from the innocent persons  even though  they are well aware of the fact that the property involved in project are involved in litigation and there by they have committed fraud  and  unfair trade practice  and deficiency of service on their part. When the OP is very much aware that they have no clear title of the property which are going to be sold by them and that they are unable to sell the litigation free  property, it is the duty of the OP to refund the amount with interest. The complainant cannot wait till the litigation is completed  or cleared  in respect of the property involved in the OP project. Under these circumstances, the complainants are entitled for the reliefs claimed in the complaint. Therefore, the complainants are entitled for the relief and the complaint is liable to be allowed in part. Hence, we answer the Point-1 in the affirmative and Point No.2 partly in the affirmative.

13. Point no.3:-.  Accordingly, OP is directed to refund advance amount paid by the complainant Rs.5,26,443/- with interest at 10% per annum from the date of filing of the complaint till realization. Further the complainants are also entitled for compensation of Rs.1,00,000/- for mental agony, financial loss. The complainants are also entitled for litigation expenses of Rs.10,000/-. The OP has directed to pay entire amount in favour of the complainant within 60 days from the date of this order, failing which the amount of Rs.5,26,443/- will carry additional interest at 12% per annum.  Accordingly, we proceed to pass the following 

O R D E R

1. The complaint is allowed in part.
2. The OP is directed to refund entire amount of Rs.5,26,443/- with interest at the rate of 10% p.a. from the date of complaint till realization.
3. The OP further directed to pay compensation of Rs.1,00,000/- for mental agony, financial loss, harassment and deficiency of service.
4. The OP further directed to pay Rs.10,000/- towards litigation expenses.
5. If the OP failed to pay the amount within 60 days, the amount of  Rs.5,26,443/- will carry additional interest at 12% p.a. after expiry of 60 days .
6. Furnish the copy of this order to both the parties, and return the spare pleadings and documents to the parties.

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Open Commission on this 30^th  day of November, 2022)

Documents produced by the Complainant-P.W.1 are as follows:

Documents produced by the representative of opposite party – R.W.1 :  Nil