Chandigarh

DF-II

CC/574/2021

Samir Kumar Biswas - Complainant(s)

Versus

M/s Hero Reality Pvt. Ltd. - Opp.Party(s)

Adv. Jagan Nath Bhandari

16 May 2023

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-II

U.T. CHANDIGARH

 

Consumer Complaint No.	:	574/2021
Date of Institution	:	31.08.2021
Date of Decision	:	16.05.2023

 

                     

            

 

1.  Samir Kumar Biswas s/o Sh.Soshil Chandra Biswas.

2.  Sumana Chanda w/o Sh.Samir Kumar Biswas

    Both residents of House No.ME-504, Indian Institute of Science Education & Research, District SAS Nagar, Sector 81, Mohali, Punjab.

 

2^nd Address:- House No.5699-B, Sector 39, West, Chandigarh.

                 ...  Complainants.

Versus

1.  M/s Hero Reality Private Ltd., Regd. Office: E-2, Qutab Hotel Complex, Shaheed Jeet Singh Marg, New Delhi-160016.

2.  M/s Housing Development Financial Corporation (HDFC) Ltd., Office Address: SCO 153—155, Sector 8-B, Chandigarh -160008.

 

…. Opposite Parties

BEFORE:
	SHRI AMRINDER SINGH SIDHU,	PRESIDENT
	SHRI B.M.SHARMA	MEMBER
Present:-
	Sh.S.K.Verma, Adv. & Sh.Jagan Nath Bhandari, Adv. Counsel for complainant Sh.Vishal Singal, Counsel of OP No.1 Ms.Neetu Singh, Counsel of OP No.2

   

ORDER BY AMRINDER SINGH SIDHU, M.A.(Eng.),LLM,PRESIDENT

1.     The complainants have filed the present complaint under Section 35 of the Consumer Protection Act, 2019, as amended up-to-date alleging therein that the complainants booked an apartment in high rise tower under the project of the OPs on 25.05.2016 by paying Rs.2.5 lacs and the possession time was 42 months.  Without issuing allotment letter, OP No.1 issued demand notice dated 04.06.2016 for Rs.3,37,887/- and more than 10% payment includes basis price, PLC, IFMS and club membership charges were received by OP No.1 till 24.06.2016 before issuing the allotment letter and executing the sale agreement. Subsequently, the allotment letter (Annexure C-1) was issued  on 16.09.2016  in respect of Flat No.1101 in Tower NO.T-04, 11^th Floor, Hero Homes, Sector 88, SAS Nagar for Rs.59,27,350/- including basic price, PLC, IFMS and club membership charges, under the subvention scheme where the payment plan was 10% at the time of booking and 80% as per construction update by the Bank and the remaining 10% at the time of possession. The OP No.1 created the wrong Builder Buyer Agreement dated 14.10.2016 (Annexure C-3) with wrong date whereas the date of agreement should have the first date of payment i.e. 25.05.2016. As per Clause 4 of the agreement, the possession was to be delivered within 36 months with 6 months as grace period (total 42 months) from the date of signing of the agreement or the start of construction. OP No. 1 also forced complainants to make a tri- party loan agreement (Annexure C-4) with the HDFC Bank / OP No.2 before signing (ABA) sale agreement with the OP No.1. On 08.06.2018, the complainants received an email notice demanding Rs.6550.04P which were paid through cheque but again the complainants were asked to pay Rs.23065.04P. On raising protest, OP No.1 sent a regret vide email 13.06.2019. Despite that, later Builder added same additional amount on the last demand letter on 24th April 2019.  The complainants received e-mail dated 27.06.2019 (Annexure C-6) for extension of Subvention Schemes and OP No.1 agreed that till 31.03.2020 the subvention would be extended and in case of further delay in possession beyond 31.03.2020 the HRPL/ OP No.1 shall reimburse the pre- EMI interest, and on this condition, the complainants gave their consent.  OP No.1 delayed the possession beyond promised date i.e. March 2020 and in April, 2020 OP No.1 stopped paying the pre-EMI to the Bank. Vide email dated 24.11.2020, OP No.1 took U-Turn and stated that they would give pre-EMI from24.09.2020 onwards and not before that but no reason was assigned for the same.  As per the interest certificate (Annexure C-8), the complainants paid a sum of Rs.3,85,911/- from April 2020 to 13.01.2021  to the Bank and requested to OP No.1 for reimbursement of the paid pre-EMI in December, 2020 and thereafter for adjustment of pre-EMI but OP No.1 did not pay any heed to it.   On 09.03.2021, the complainants received a letter containing offer of possession along with a demand letter dated 13.01.2021 for a sum of Rs.8,51,871/- which did not adjust pre-EMI, delay charges despite advanced (prior) request for re- imbursement of the paid pre-EMI as per the subvention schemes. In June 2021 when the complainants did not get the correct demand notice after a number of reminders for corrections, then complainant No.1 himself after adjustment of pre-EMI and other charges (as per various sections mentioned on the payment sheet and the agreement), he paid a sum of Rs.2,45,800/- as balance amount came after adjustment and sent an email for issuance of NOC to OP No.1 and again OP No.1 did not put any head to it and did not reply till date. OP No.1 sent threatening emails to complainants to make the payment first only then they will be allowed to visit the premises and further denied to furnish to provide the copy of OC and other approvals. It has further been alleged that despite 100% payment till date OP No.1 have not handed over the actual valid physical possession and enjoying their hard earned money, as a result,  the Complainants are paying the interest to OP No.2. Finally, the complainants got served a legal notice dated 27.08.2021 (Annexure C-11) but to no effect. Recently on 17.08.2021 (Annexure C-12) the complainants received cancellation letter dated 13.08.2021 from OP No.1 on the basis of OP. No. 2's letter dated 26.11.2020 in respect of the unit in question stating that OP No.2/ HDFC bank had issued letter dated 26.11.2020 to OP No.1 for cancellation of the unit and refund of Loan amount. There was a continuous discussion with OP No.2 since August 2020 on the pre-EMI payment where, OP No.1 was kept in the CC loop and OP No.1 never put a head to It. However, under immense pressure from bank, complainants have confirmed the due payment to OP No.1 and did all the due payments on 10th December 2020. Further, in the response of cancellation letter issued by OP No.1, the complainant sought response from OP No.2 on 18.08.2021 and then OP No.2 sent immediately a withdraw letter dated 19.08.2021 (Annexure C-13), withdrawing the letter dated 26.11.2020 and mentioned that EMI was regularized under the loan account after clearance of all dues on or before 10th December 2020. It was further averred that under compelling circumstances, the complainants paid all pre-EMI to the OP No.2. In response of cancellation letter issued by OP No.1, the complainants served legal notice dated 21.08.2021 (Annexure C-14) to the OP No.1 and gave last and final 7 days to withdraw said cancellation letter dated 13.08.2021 (Annexure C-12), and further for settle the accounts and hand over the actual valid offer of possession but till date the OP No. 1 have not put any head and reply to the said legal notice. It has further been averred that by issuing the cancellation letter, OP No.1 wants to grab the hard earned money of Rs.59,98,254.90 paid by the complainants against the said unit. Alleging that the aforesaid acts of omission and commission on the part of the OPs amount to deficiency in service and unfair trade practice, the complainants have filed the instant complaint against the OPs.
2.     In its written version, OP No.1 took preliminary objections inter alia that the complaint is not maintainable as there is no deficiency in service or unfair trade practice as alleged; the complaint is abuse of process of law; the delay of nearly 9 months was not intentional and also attributable due to onset of covid 19 pandemic. The possession as per the agreement was to be handed over within 42 months from the date of execution of the agreement dated 14.10.2016 and period of 42 months expired on 14.04.2020. The possession was delivered within a reasonable time and delay is not unreasonable.  It has been stated that the complainants did not pay the due amounts and defaulted in the payment of the installments despite issuance of reminders and as such the unit was cancelled on 13.08.2021 and the money was forfeited for default.  OP No.1 paid the pre-emi charges to the tune of Rs.10,89,607/- on behalf of the complainants to the Bank. In totally, a sum of Rs.59 lakhs were received from the complainants out of which Rs.48 lakhs was advanced by the Bank and in case of refund, a sum of Rs.10,89,607/- paid by it is liable to be deducted along with amount of forfeiture as the unit was cancelled and the amount forfeited. The remaining allegations have been denied, being false. Pleading that there is no deficiency in service on its part, OP No.1 has prayed for dismissal of the complaint.
3.     In its written version, OP No.2 has stated that the grievance of the complainants is only against OP No.2  who has allegedly failed to adhere by the terms and conditions of the Buyer Agreement and also and are aggrieved of the delay in handing over the possession of the unit.  It has further been stated that the consequence of the default in repayment of the loan are governed by the terms and conditions of the loan agreement.  It has been stated that a sum of Rs.48,18,483/- has been disbursed to the complainants as loan and as on today i.e. 14.10.2021, an amount of Rs.48,65,641/- is repayable. It has further been stated in the event of any cancellation of the plot for any reason whatsoever, any payment made by the builder directly to the HDFC will not absolve the complainants from their liability to pay the residual amount, if any, from the outstanding under the loan agreement as per Clauses 8, 9 and 10 of the tripartite agreement. The remaining allegations have been denied, being false. Pleading that there is no deficiency in service on its part, OP No.2 has prayed for dismissal of the complaint.
4.     The complainants filed replication to the written reply of OP No.1 controverting its stand and reiterated the contents of the complaint.
5.     The parties filed their respective affidavits and documents in support of their case.
6.     We have heard the Counsel for the contesting parties and have gone through the documents on record, including written arguments.
7.     From the perusal of the application form (Annexure R-2), it is evident that OP No.1 received booking amount of Rs.2.50 lakhs from the complainants qua the unit in question through cheque dated 19.05.2016 drawn on State Bank of India and the provisional allotment letter was issued on 16.09.2016 and subsequently the Apartment Buyer Agreement (Annexure C-3) between the complainants and OP No.1 was executed on 14.10.2016 for a total sale consideration of Rs.59,27,350/- i.e. after the receipt of the application money/booking amount, which itself amounts to deficiency in service as also unfair trade practice as the agreement is to be executed between the parties on the same day when the builder receives the booking amount from the purchaser qua the unit/flat to be allotted. It may also be stated here that OP No.1 issued the demand notice dated 04.06.2016 in the sum of Rs.3,67,887/- even before issuance of the allotment letter to the complainants.
8.     The complainants also alleged that the offer of possession letter dated 13.01.2021 (Annexure R-6) in respect of the unit issued by OP No.1 was not valid offer as the apartment was not complete in all respects and was lacking many amenities. We find force in this submission of the complainants because the occupation certificate (Annexure R-7) was issued by the competent authority to OP No.1 on 08.02.2021 meaning thereby that when the offer of possession letter dated 13.01.2021 was issued to the complainants, the unit in question was not complete in all respects and as such the offer made by OP No.1 is not a valid offer and the complainants were right in not accepting the possession of the incomplete unit.
9.     As per Clause 4.1 of the agreement, the possession of the unit was to be handed over within 42 months, from the date of signing the agreement or start of construction whichever is earlier. The period of 42 months was expired on 14.04.2020 if the same is counted from the date of signing of the agreement. However, if the same is counted from the date of start of the construction i.e. 07.01.2016, then the same ends on 06.07.2019.  In the present case, OP No.1 offered the possession of the unit on 13.01.2021 and as such there was a considerable delay in handing over the possession of the unit in question to the complainants.  In view of the above, OP No.1 who itself failed to adhere to the terms and conditions of the agreement has no right to claim the interest on the delayed payments, if any.  As such, the complainants were well within his right not to make payment of remaining sale consideration, in view of principle of law laid down by the Hon’ble Supreme Court of India in 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 residential units by the stipulated date, it cannot expect the allottee to go on paying installments to it. Similar view has 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, the payment of further installments was rightly stopped by the purchaser.

         Under above circumstances, it is held that by cancelling the allotment of unit in question, on the ground that the complainants were defaulter in making remaining payment, especially when the complainants have paid more than the total sale consideration; OP No.1 adopted unfair trade practice and are also remained deficient in providing services to the complainants. So, it is held that OP No.1 has cancelled the allotment of the flat in question wrongly and arbitrarily because it does not possess all the requisite permissions and approvals from the competent Authorities as per the requirement of law for offering possession to the complainants. Hence the cancellation of the allotment letter dated 13.08.2021 is set aside and it is held that OP No.1 is liable to restore the allotment of the unit in favour of the complainants. It is also held that the complainants are not liable to pay any interest on delayed payment, if any, to OP No.1 on the payments already made.

10.      In view of the above discussion, the present complaint is partly accepted along with compensation qua OP No.1. OP No.1 is directed as under:-

1. To restore the allotment of unit in question, within a period of one month from the date of receipt of a certified copy of this order, without demanding any interest on the payments already made.
2. To immediately hand over possession of the apartment/flat complete in all respects to the complainants.
3. To issue fresh statement of accounts to the complainants after adjusting, interest, penalty and cost as imposed upon OP No.1 in the present order.
4. To pay compensation for causing mental agony and physical harassment to the complainants on account of  deficiency in providing service and adoption of unfair trade practice by cancelling the allotment of unit wrongly and arbitrarily, in lumpsum, to the tune of Rs.1,00,000/- (Rupees One lakh only), to the complainants, within a period of 60 days, from the date of receipt of a certified copy of this order, failing which, the said amount of Rs.1,00,000/-(Rupees One lakh only), shall carry interest @12% p.a. from the date of passing of this order, till the date of its actual realization.

11.     The pending application(s) if any, stands disposed of accordingly.
12.     The complaint qua OP No.2 stands dismissed as there is no deficiency in service on its part.
13.     Certified copy of this order be sent to the parties, as per rules. After compliance file be consigned to record room.

Announced in open Commission 16/05/2023
	Sd/- (AMRINDER SINGH SIDHU) PRESIDENT
	Sd/- (B.M.SHARMA) MEMBER