Chandigarh

StateCommission

CC/80/2024

Mukesh Kohli - Complainant(s)

Versus

M/s Innovative Housing and Infrastructure (P) Ltd. - Opp.Party(s)

Devinder Kumar Adv.

09 Dec 2024

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

 

Consumer Complaint No.	:	80 of 2024
Date of Institution	:	20.08.2024
Date of Decision	:	09.12.2024

 

Sh. Mukesh Kolhi son of Sh.Uday Singh, aged about 39 years, resident of House No. 1111, Sector 24-B, Chandigarh.

...Complainant.

Versus

1.       M/s Innovative Housing and Infrastructure (P) Limited, Corporate Office: SCO No. 198, Opposite Sports Complex, Sector 7, Chandigarh through its Managing Director-Sh. Jagjit Singh.

 

2.       Sh. Jagjit Singh, Managing Director of M/s Innovative Housing and Infrastructure (P) Limited, Corporate Office: SCO No. 198, Opposite Sports Complex, Sector 7, Chandigarh.

….Opposite Parties.

 

BEFORE:

JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT. MR. RAJESH  K. ARYA, MEMBER

 

ARGUED BY:      

 

Sh. Devinder Kumar, Advocate for the complainant.     

Sh. Harjeet Singh Bedi, Advocate for the opposite parties.

 

PER  RAJESH  K.  ARYA, MEMBER

Brief facts:-

                   The complainant, seeking residential accommodation near Chandigarh for personal and family use, was attracted to the "PCL GATEWAY" project, located in Sector 17 & 18, New Chandigarh, District SAS Nagar, Mohali, based on multiple assurances made by the opposite parties through advertisements, marketing, emails and telemarketing. In November 2019, the opposite parties assured the complainant that the project was approved by the Punjab Government, with all requisite permissions and that possession of the plot would be delivered within 6 months from the date of booking. Relying on these assurances, the complainant proceeded to book a plot by paying an initial booking amount of ₹1,00,000/- via cheque dated 30.11.2019. The total sale price of the plot was quoted at ₹29,00,000/-. Following further demands from the opposite parties, the complainant paid an additional sum of ₹5,00,000/- on 11.01.2020. Upon receipt of ₹6,00,000/-, the opposite parties issued a Letter of Allotment dated 06.02.2020, allotting Plot No.1510, measuring 112 sq. yards (100 sq. yards as per site). A Developer-Purchaser Agreement was executed on the same date, which stipulated that possession would be handed over on or before 31.03.2020 with a grace period of 6 months. Subsequently, the opposite parties issued a Demand Letter dated 13.02.2020, requesting the complainant to pay the balance sum of ₹23,00,000/-. The complainant also entered into a Tripartite Agreement with the opposite parties and Housing Development Finance Corporation Limited (HDFC Bank), whereby a loan sum of ₹12,50,000/- was directly paid to the opposite parties by HDFC Bank on 06.03.2020. By March 2020, the complainant had paid a total of ₹18,50,000/-. From that point, the complainant has been making monthly installments of ₹12,091/- to HDFC Bank without default. Despite payment of ₹18,50,000/- by the complainant and the stipulations of the Agreement, the opposite parties failed to deliver possession of the plot by the promised date. The complainant made repeated visits to the office and project site but the opposite parties continually delayed the possession without valid reasons. In May 2021, the opposite parties issued an Offer of Possession letter, directing the complainant to clear any outstanding dues. Following this, the complainant paid an additional sum of ₹10,50,000/-, bringing the total paid to ₹29,00,000/-, the full and final amount as per the basic sale price. However, the complainant did not receive possession and the opposite parties failed to respond to requests for compensation for the delay.

2]                Upon attempting to apply for internal building plan approval from GMADA, the complainant discovered that the opposite parties had not obtained the necessary approvals from the relevant authorities. Despite this, the opposite parties issued the possession letter in May 2021 without the required No Objection Certificate (NOC). The complainant requested clarification regarding the validity of the possession letter for obtaining approvals from GMADA and starting construction but received no response. An RTI application filed by the complainant revealed that GMADA had failed to provide the relevant information concerning the "PCL Gateway" project and instead provided details about a different project, "The Address." In June 2024, when the complainant visited the project site, he found that no progress had been made and the project remained incomplete. The complainant documented the situation with photographs, confirming the ongoing delay. He further averred that the terms and conditions of the Developer-Purchaser Agreement are one-sided, placing undue burden on the complainant and primarily benefiting the opposite parties, reflecting an intent to extract financial gain at the expense of the complainant. It has been averred that the opposite parties’ actions have thus been fraudulent and in violation of the terms agreed upon.

3]                Thus, by filing this complaint, the complainant has sought directions to the opposite parties to handover physical possession of the Plot No.1510, measuring 112 sq. yds. (100 sq. yds. as per the site) in the project "PCL-Gateway" situated at Sec 17&18, New Chandigarh, Distt: SAS Nagar Mohali alongwith all basic amenities, after obtaining completion certificate from the competent authorities; pay compensation by way of interest @18% p.a. as delayed compensation on the entire amount deposited by the complainant from the due date of possession i.e. 31.03.2020 to till possession is actually delivered as per the clause No.6 of the Agreement; pay compensation to the tune of ₹5,00,000/- for deficiency in rendering service, suffering of pain and mental harassment and also pay ₹75,000/- as litigation charges.

Reply of the opposite parties:-

1. The opposite parties, in their written reply, while admitting that the complainant had applied for a plot no.1510 measuring 112 sq. yds. in their upcoming residential Project "PCL Gateway" situated at Sector-17& 18 New Chandigarh, Mullanpur Master plan, have pleaded that since it is a Mega Township of 155.90 Acres and there are certain parameters as per the GMADA authorities and the work is in progress, therefore, there is delay in the possession due to various institutional delays by concerned authorities. It has been further stated that all the recent developments included STP/Rain Water Harvesting /Transformers Power Supply/Roads and developed parks are existing in the project as per latest photographs, Annexure R-1. It has further been stated that as per the contract, the total consideration was fixed for amount of ₹29 Lakhs and the complainant has paid full amount as per the agreement. It has further been stated that the delay after March 2020 is due to Covid 19 and institutional delay by concerned authorities. The opposite parties have annexed latest NDC from the GMADA authorities as Annexure R-2 alongwith their reply. Lastly, prayer for dismissal of the complaint has been made.
2.  
3. In the rejoinder filed, the complainant reiterated all the averments contained in the complaint and controverted those contained in written reply of the opposite parties. It has been specifically stated that the opposite parties, without producing any documentary evidence, are misleading this Hon'ble Commission. It has further been stated that in the event of any force majeure situations (delays after and institutional delays by concerned authorities), the opposite parties should be put to strict proof qua NOCs/Connections/approvals/licenses issued by the competent local authority and/or judicial or regulatory orders. It has further been stated that the opposite parties, with malafide intention, only placed on record Annexure R-2 but failed to place on record other documents and are concealing true facts from this Commission. It has further been stated that the opposite parties have totally failed to show any force majeure, which stopped them in offering possession of the plot in question. It has further been stated that the opposite parties were to deliver a plot after obtaining necessary approvals from the competent authorities and as per settled law, the onus to prove the stage and status of construction and development work at the project site and that all the permissions/ approvals have been obtained in respect thereof, is on the builder/ developer. It has further been stated that the opposite party cannot collect the money from the consumers without getting all the approvals from the competent authorities, thus, there is deficiency in service and unfair trade practice on the part of the opposite parties.
4. The parties led evidence in support of their case.
5. We have heard the Counsel for the parties and have gone through the evidence and record of this case including the written arguments filed by the opposite parties, very carefully.

Observations/findings of this Commission.

1.                 Admittedly, despite complete payment of an amount of ₹29 Lakhs, the possession has still not been delivered by the opposite parties to the complainant. It was stipulated in letter of allotment dated 06.02.2020, Exhibit C-4 that possession of the plot in question was to be delivered by the opposite parties by 31.03.2020 with grace period of six months i.e. latest by 30.09.2020 subject to the allottee not being in breach of any of the terms of the application/letter of allotment. Similarly, in Agreement (Developer-Purchaser) dated 06.02.2020, Exhibit C-5, it was stipulated vide Clause 6 that the Developer (opposite parties) agreed to put the purchaser (complainant) in absolute, vacant and encumbrances free possession of the schedule property on or before 31.03.2020 (with grace period of six months), after completing all the development work (MEPs) and with all necessary permissions from the Govt./Authorities concerned and in the event of any force majeure situations (including but not limited to inordinate delay in issuance of NOCs/connections/approvals/licenses from the competent local authorities and/or judicial or regulatory orders), the date of such possession for Unit/Plot shall stand extended accordingly. In the instant case, the complainant paid amount of ₹6 Lakhs i.e. ₹1 Lakh in November 2019 and ₹5 Lakhs in January 2020 as per payment receipts issued by the opposite parties, Exhibits C-2 and Annexure C-3 and the unit was allotted to the complainant vide allotment letter dated 06.02.2020, Annexure C-4. It is admitted position on record that as per Clause-8 of the Letter of Allotment aforesaid, the opposite parties were to make available the absolute, vacant and encumbrance free plot for possession by 31.03.2020 (with a grace period of three months) subject to the allottee not being in breach of any of the terms of the application form/letter of allotment. Per record, there is no breach on the part of the complainants as he has already paid the entire sale consideration of the plot in question i.e. ₹29 Lakhs by 12.05.2021. It was only in the event of any force majeure situations (including but not limited to inordinate delay in issuance of NOCs/Connections/ approvals/licenses from the competent local authority and/or judicial or regulatory orders), the date of such possession for unit/plot was to be extended. However, in the instant case, in their written arguments, the opposite parties have only stated that there is delay in the grant of necessary permission by the State Government/Authorities and they are still willing to offer possession of the plot in question to the complainant. The opposite parties have totally failed to show any force majeure, which stopped them in offering possession of the plot in question. The opposite parties were to deliver a plot after obtaining necessary approvals from the competent authorities. It is settled law that onus to prove the stage and status of construction and development work at the project site and that all the permissions/approvals have been obtained in respect thereof, is on the builder/developer. It was so said by the Hon’ble National Commission, in Emaar MGF Land Limited and another Vs. Krishan Chander Chandna, First Appeal No.873 of 2013 decided on 29.09.2014. It is very strange that in the present case, not even an iota of evidence has been placed on record by the opposite parties to prove as to at what stage, construction and development work has reached at the project site and that as to whether approvals/sanctions have been obtained from the competent Authorities to launch the said project. In case, the development/construction activities are being undertaken or complete at the project site, then it was for the opposite parties, which could be said to be in possession of the best evidence, to produce cogent and convincing documentary evidence, in the shape of the reports and affidavits of the Engineers/Architects, as they could be said to be the best persons to testify    as to whether, all these development/construction activities, are being undertaken or complete at the site or not, but they failed to do so. Even the photographs annexed by the opposite parties along-with their reply show that the project is still incomplete and construction activity is still going on at the site. Moreover, No Due Certificate has been issued by GMADA to the Chief Town Planner, Punjab with regard to the Mega Residential Project of the opposite parties only on 17.05.2024 wherein it has been intimated that the Promoter has deposited the required full dues upfront as per the additional demand notice issued against the revised layout plan and further, against the old demand notices, the promoter has opted for Punjab Govt. policy dated 09.03.2024 and has deposited the required upfront dues and PDCs and next installment would fall due on 05.11.2024.

9]                Furthermore, the opposite parties have cited Covid-19 as force majeure, to this, the complainant in his rejoinder has specifically stated that in the event of any force majeure situations (delays after and institutional delays by concerned authorities), the opposite parties should be put to strict proof qua NOCs/Connections/approvals/licenses issued by the competent local authority and/or judicial or regulatory orders. In this regard, it may be stated here that there is nothing on record to show that opposite parties suffered any force majeure circumstances, on account of which, the construction and development work at the project site could not be completed and possession of plot was not delivered to the complainant by the committed date, referred to above, or even till date. Regardless of external challenges or delays, it remains the responsibility of the opposite parties to ensure that all steps are taken to fulfill their contractual obligations. Delays in approvals, while possibly outside the immediate control of the developer, do not justify the complete failure to deliver possession unless they are clearly linked to an event that qualifies as force majeure under the law. Not only this, in contractual agreements, timelines are typically fixed based on certain expectations and assumptions. While general disruptions like COVID-19 could cause delays, the promoter could not use the pandemic as an excuse unless it directly impacted the ability to meet specific contractual milestones, such as regulatory approvals, construction work or inspections. Further, while the opposite parties claim that delays are due to various institutional delays by concerned authorities, this argument does not absolve them from responsibility for the timely delivery of possession. Delays in possession, irrespective of institutional factors, need to be addressed by the developer or the party responsible for the project’s delivery timeline. The parties involved must account for the fact that customers or buyers entered into an agreement with the developer or builder, not with external authorities. Therefore, it is the developer’s responsibility to ensure timely coordination with these authorities. 

10]              From the peculiar circumstances of this case, it is proved that the builder-Company made false representations, which were materially incorrect and were made in such a way that the complainant, to whom it was made, was entitled to rely upon it and he may act in reliance on it. The complainant is thereby involved in a disadvantageous contract with builder-Company and suffered financial loss, mental agony and physical harassment. All the facts established that from the very inception, there was intent to induce the complainant to enter into an unfair contract and also intent to deceive him, which act amounts to grave deficiency in providing service, negligence and adoption of unfair trade practice on the part of the builder-Company.

11]          On account of delay in actual delivery of possession within the stipulated period, the complainant has suffered mental agony, hardships and financial loss. In the case titled as Lucknow Development Authority v. M K Gupta (1994) 1 SCC 243, the Hon’ble Supreme Court discussed about the extent of the jurisdiction of the Consumer Fora to award just and reasonable compensation for the harassment and agony suffered by a consumer. In Nagesh Maruti Utekar Vs. Sunstone Developers Joint Venture, Consumer Case No. 12 of 2017, decided on 04 May 2022, The Hon’ble National Commission awarded interest @9% p.a. from the committed date of delivery till possession is delivered. Relevant part of the said order is reproduced hereunder:-

“……Consequently, the Opposite Party Developer is directed to pay interest @9% w.e.f. 31.03.2014, i.e., the expected date of delivery of the possession, on the amount deposited by the respective Complainant till 02.09.2017, i.e., the date on which the possession of the Flat was offered by the Opposite Party Developer, within two months from today..…..”

In Shreya Kumar & 11 Ors. Vs. M/s. Ansal Housing & Construction Ltd. & 3 Ors., Consumer Case No. 1021 of 2017, decided on 05 May 2022, the Larger Bench of the Hon’ble National Commission has awarded interest @9% p.a. from the committed date of delivery till possession is delivered. In the present case, the complainant purchased the plot in question, as far as back in November 2019. He is still empty handed and has been forced to approach this Commission for redressal of his grievance. The opposite parties have played fast and loose with the complainant and has caused harassment and mental agony to him, which is unacceptable and this practice needs to be deprecated. In our considered opinion, if we grant interest @9% p.a. to the complainant on the entire amount deposited by him, from the due date of possession onwards till delivery of possession thereof, that will meet the ends of justice.

12]              Since fault lies with the opposite parties in not delivering the possession of the plot in question, therefore, they are not entitled to any delayed interest or penalty from the complainant. 

13]              For the reasons recorded above, the complaint is partly accepted with costs and the opposite parties, jointly and severally, are directed as under:-

1. To deliver actual physical possession of Plot No.1510 measuring 112 sq. yards in the project “PCL-Gateway” situated at Sector 17 & 18, New Chandigarh, Distt. SAS Nagar, Mohali (Pb.), to the complainant, complete in all respects, after obtaining occupation and completion certificate from the competent Authority, within a period of 03 months from the date of receipt of a certified copy of this order. However, it is made clear that the complainant shall also pay the Govt. Fee, if any, before taking over the actual physical possession of the plot in question.  
2. To pay to the complainant, interest @9% p.a. on the amount deposited i.e. ₹29,00,000/- towards sale consideration, starting from 01.10.2020 (committed date for possession + six months) till 31.12.2024, within a period of 30 days from the date of receipt of a certified copy of this order, failing which the entire accumulated amount shall carry interest @12% p.a. from the date of default till this entire accumulated amount is paid to the complainant.
3. To pay to the complainant, interest @9% p.a. on the amounts deposited w.e.f. 01.01.2025, onwards (per month), by the 10^th of the following month till actual delivery of physical possession of the plot, complete in all respects. 
4. To pay to the complainant, compensation to the tune of ₹75,000/- for causing him mental agony and harassment and also for deficiency in providing service and adoption of unfair trade practice and cost of litigation to the tune of ₹35,000/-, within a period of 30 days, from the date of receipt of a certified copy of this order, failing which, the said amounts shall carry interest @9% p.a. from the date of default till realization.

14]              Certified copies of this order be sent to the parties free of charge.

15]              File be consigned to Record Room after completion.

Pronounced.

09.12.2024.

(JUSTICE RAJ SHEKHAR ATTRI)

PRESIDENT

 

 

 

 

(RAJESH K. ARYA)

MEMBER

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