Chandigarh

StateCommission

CC/349/2018

Anil Bhasin - Complainant(s)

Versus

M/s Omaxe Chandigarh Extension Developers Private Limited - Opp.Party(s)

Sukaam Gupta, Adv.

20 Sep 2019

ORDER

  STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Complaint case No.	:	349 of 2018
Date of Institution	:	13.09.2018
Date of Decision	:	20.09.2019

 

1. Anil Bhasin S/o Sh. R.K. Bhasin, r/o #126, Sector 16-A, Chandigarh.
2. Satish Kumar Sharma S/o Sh.Chiranji Lal Sharma, r/o # A-043, Icon Apartments, DLF, Phase-V, Gurgaon.

…..Complainants

V e r s u s

M/s Omaxe Chandigarh Extension Developers Pvt. Ltd., SCO 143-144, Sector 8-C, Chandigarh, through its Managing Director/Authorized Signatory.

…..Opposite Party

 

Complaint under Section 17 of the Consumer Protection Act, 1986.

 

BEFORE:         JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT

                        MRS. PADMA PANDEY, MEMBER

                        MR. RAJESH K. ARYA, MEMBER

 

Argued by:       Sh.Sukaam Gupta, Advocate for the complainants.

      Sh.Ashim Aggarwal, Advocate for the opposite party.

 

JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT

 

                The complainants have filed this complaint seeking directions to the opposite party to deliver possession of plot bearing no.OCE/II/1075, measuring 301.38 square yards, purchased by them, in its project named ‘Omaxe Chandigarh Extension”, Mullanpur, SAS Nagar, Punjab, total price whereof was fixed at Rs.33,33,591.51ps. It is definite case of the complainants that despite the fact that as per demands raised by the  opposite party, from time to time, they have paid substantial amount of Rs.35,46,195/- towards price of the said plot but it failed to deliver possession thereof by 22.05.2014 i.e. within a period of 18 months plus 6 months totaling 24 months, as committed vide Clause 24 (a) of the agreement dated 23.05.2012 (Annexure C-3), for want of development work and basic amenities at the project site. Not only as above, the opposite party failed to execute Allotment Letter/Agreement, as per the provisions of Section 6 (1) Punjab Apartment Property and Regulation Act, 1995 (in short the PAPRA). On the other hand, it was sent for signatures of the complainants, on receipt of 90% of the total sale consideration of the plot in question. Even the provisional allotment letter in respect of the plot in question was issued in favour of the complainants, after a delay of about 11 months. A number of times, the complainants requested the opposite party to deliver possession of the plot in question but every time bald assurances were given to them.

                        It has been stated that the aforesaid act of the opposite party amounted to deficiency in providing service and adoption of unfair trade practice. Hence this complaint has been filed by the complainants seeking directions to the opposite party to deliver possession of the plot in question; to pay compensation by way of interest @18% p.a. on the deposited amount for the period of delay in offering possession; to pay Rs.5 lacs as compensation for mental agony and physical harassment and Rs.1 lac as cost of litigation.  

2.         Their claim has been contested by the opposite party, on numerous grounds, inter alia, that in the face of existence of provision to settle disputes between the parties through Arbitration, this Commission has no jurisdiction to entertain this consumer complaint; that since complainant no.1 is a property dealer and has no relation whatsoever with complainant no.2, as such, they are investors and did not fall within the definition of “consumer” as defined under Section 2(1)(d) of the Act; that this Commission did not vest with pecuniary and territorial jurisdiction; and that no definite period was committed to hand over possession of the plot and the Company only proposed to put its effort for delivering possession of the plot within the period mentioned in Clause 24(a) of the Allotment Letter, therefore, time was not to be considered as essence of the contract.
3.         On merits, sale of plot to the complainants; payment made by them towards it, as mentioned in the complaint has not been disputed. It was stated that possession of the plot, in question, was offered to the complainants, vide letter dated 17.04.2017 (Annexure OP1/1), which fact has been concealed by them. Though the complainants made remaining payment, as demanded at the time of issuance of offer of possession, but they failed to take over possession of the plot, as a result whereof, numerous reminders were sent to them, in the matter. It has been averred that completion certificate (Annexure OP/3), in respect of the project, in question, was received by the opposite party, on 28.04.2017. Remaining averments have been denied being wrong. Prayer has been made to dismiss the complaint with cost.
4.         In the rejoinder filed, the complainants reiterated all the averments contained in the complaint and controverted those, contained in written version of the opposite party.
5.         The parties have been afforded adequate opportunities to adduce evidence, which has been led, in support of their respective cases, by way of affidavit and also produced numerous documents.
6.         We have heard the contesting parties and have gone through the evidence and record of the case, very carefully.
7.         In this case, following points have been emerged for consideration:-
   1. Whether the arbitration clause contained in the allotment letter/agreement bars the jurisdiction of this Commission?
   2. Whether this Commission has territorial and pecuniary jurisdiction to entertain and decide this complaint?
   3. Whether the complainants fall under the definition of ‘consumer’?
   4. Whether time was essence of the contract?
   5. Whether possession offered by the opposite party to the complainants vide letter dated 17.04.2017 could be said to be legal, especially, when it was offered in the absence of obtaining completion certificate?
   6. Whether the complainants are entitled to be compensated for the period of delay in offering possession and, if yes, to what extent?

 

8.         First, we would like to deal with the objection raised by the opposite party, to the effect that in the face of existence of provision in the agreement, to settle disputes between the parties through Arbitration, this Commission has no jurisdiction to entertain the consumer complaint. It may be stated here that this issue has already been dealt with by the larger Bench of the National Commission in a case titled as Aftab Singh  Vs. Emaar MGF Land Limited & Anr., Consumer Case No. 701 of 2015, vide order dated 13.07.2017, has held that an Arbitration Clause in the Agreements between the complainant and the Builder cannot circumscribe the jurisdiction of a Consumer Fora, notwithstanding the amendments made to Section 8 of the Arbitration Act. Feeling aggrieved against the said findings, the builder filed Civil Appeal bearing No.23512-23513 of 2017 before the Hon’ble Supreme Court of India, which was dismissed vide order dated 13.02.2018. Even the Review Petition (C) Nos. 2629-2630 of 2018 filed by the builder in Civil Appeal Nos.23512-23513 of 2017 against order dated 13.02.2018, was dismissed by the Hon’ble Supreme Court of India, vide order dated 10.12.2018.

                In this view of the matter, objection raised by the opposite party, in this regard, stands rejected.

9.         Now coming to the objection raised with regard to territorial jurisdiction of this Commission, it may be stated here that according to Section 17 of the Act, a consumer complaint can be filed, by the complainants, before the State Consumer Disputes Redressal Commission, within the territorial Jurisdiction whereof, a part of cause of action arose to them. In the instant case, it is evident that Allotment Letter/Agreement dated 23.05.2012 (Annexure C-3) containing detailed terms and conditions has been executed between the parties, at Chandigarh Office of the opposite party, as its every page bear round stamp of the said Office. Furthermore, even the letter dated 17.04.2017 alongwith statement of accounts of the even date (Annexure OP/1) colly. placed on record by the opposite party itself, reveal, that the same was issued by Chandigarh Office of the Company.  There are numerous letters placed on record, which reveal that Regional Office of the opposite party at SCO 143-144, First Floor, Sector 8-C, Madhya Marg, Chandigarh-160008, was corresponding with the complainants, as far as purchase of the plot in question is concerned. As such, this Commission has got territorial Jurisdiction to entertain and decide this complaint.  Objection taken in this regard, therefore stands rejected. 
10.         Now coming to the objection raised with regard to pecuniary jurisdiction of this Commission, it may be stated here that in the present case, if total value of the plot, in question i.e. Rs.33,33,591.51ps.; plus compensation claimed by way of interest @18% p.a. on the deposited amount of Rs.35,46,195/-, for the period of delay, in offering possession of the plot; and also Rs.5 lacs, claimed as compensation for mental harassment etc., is clubbed together, it exceeds Rs.20 lacs and fell below Rs.1 crore. Thus, this Commission has got pecuniary Jurisdiction, to entertain and decide this complaint. Objection taken, thus, stands rejected.
11.         The next question, that falls for consideration, is, as to whether, the complainants are consumers, as defined under Section 2 (1) (d)  of the Act. It has been vehemently contended by Counsel for the opposite party that because complainant no.1 is a property dealer, as such, he has purchased the plot in question for commercial purpose. We do not agree with the contention raised. Irrespective of the fact that complainant no.1 is a property dealer, as alleged by the opposite party, even then he needs a house for his residential purpose. No law debars a property dealer to purchase a house for his own use. It is very significant to add here that the complainants are seeking possession of the plot in question and not refund of the amount deposited. Had the opposite party proved by placing on record some cogent evidence in the shape of ‘agreement to sell’ with some third person, showing sale of the plot in question, only in those circumstances, it would have been held by this Commission that since complainant no.1 is a property dealer and as such the plot in question was purchased for resale, to earn profits out of it. Furthermore, no law debars two friends (in the present case the complainants) having a cordial family relation, to buy a plot after constructing a house thereon, under amalgamation scheme, in order to reside therein, with their respective families. Thus, in the absence of any cogent evidence, in support of the objection raised by the opposite party mere bald assertion to that effect, cannot be taken into consideration. In a case titled as Kavita Ahuja Vs. Shipra Estate Ltd. and Jai Krishna Estate Developer Pvt. Ltd. 2016 (1) CPJ 31, by the National Consumer Disputes Redressal Commission, New Delhi, it was held that the buyer(s) of the residential unit(s), would be termed as consumer(s), unless it is proved that he or she had booked the same for commercial purpose. Similar view was reiterated by the National Commission, in DLF Universal Limited Vs Nirmala Devi Gupta,  2016 (2) CPJ 316. The principle of law, laid down, in the aforesaid cases, is fully applicable to the present case. The complainants, thus, fall within the definition of ‘consumer’, as defined under Section 2(1)(d) of the Act. Such an objection, taken by the opposite party, therefore, being devoid of merit, is rejected.  
12.         It is not in dispute that the complainants purchased the plot, in question,  in the manner, referred to above, in the project of the opposite party, for which, substantial amount of Rs.35,46,195/- stood paid but possession thereof was not delivered to them by 22.05.2014 i.e. within a period of 18 months plus 6 months totaling 24 months, as committed vide Clause 24 (a) of the agreement dated 23.05.2012. In the entire written statement, we did not find even a single reason assigned by the opposite party, as to why, possession of the plot in question was not offered and delivered to the complainants, by the committed date. The opposite party was thus deficient in providing service on this count.

                Now the question which arises for consideration is, as to whether, the possession so allegedly offered vide letter dated 17.04.2017 (Annexure OP/1) could be said to be genuine or it was just a paper possession. It is very significant to mention here that it is well settled law that before offering and delivering possession of residential plot(s)/unit(s) to the allottees, builder is required to obtain occupation and completion certificates. Since, in the present case, it is a plot, as such, the complainants were obliged to take possession thereof, only if all the development work was complete in all respects and completion certificate has been obtained by the opposite party, from the Competent Authority. Similar view was taken by the National Commission, in Inderjit Singh Bakshi Versus S.M.V. Agencies Private Limited, FA No. 729 of 2013, decided on 30.11.2015. In the present case, it is not disputed that when possession of the plot, in question, was allegedly offered for the first time, on 17.04.2017, the opposite party was not in possession of completion certificate.                     

                At the same time, burden to prove that the area/site of the project, is fully developed is on the builder/opposite party. It was so said by the 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 party, to prove that when offer was made to the complainants, in respect of the plot, in question, on 17.04.2017, development work was complete and that all the basic amenities were in existence, at the project site. In case, all the development/construction activities, had been undertaken, and completed at the site, by the said date, then it was for the opposite party, 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, had been undertaken and completed at the site or not, but it failed to do so. As such, it is held that the possession, so allegedly offered vide letter dated 17.04.2017, (Annexure OP/1) was nothing, but a paper possession and is not sustainable in the eyes of law. The complainants were not bound to take over possession of the plot, in question, under the said paper offer, in the absence of completion certificate. By offering possession of the plot in question in the absence of completion certificate, the opposite party adopted unfair trade practice.  

13.         Counsel for the opposite party  contended that since it was mentioned in the Allotment Letter/Agreement that the Company shall make its best efforts to deliver possession of the plot within a period of 18 months, with further grace period of six months, as such, time was not the essence of contract. The contention raised is devoid of merit. It may be stated here that once a specific period of 18 months, with extended period of 6 months was mentioned in Clause 24 (a) of the Allotment Letter/Agreement with commitment of best efforts, to complete the development/ construction work, now at this stage, the opposite party  cannot wriggle out of the same. Other than this Clause contained in the allotment letter, there is no Clause, which speaks about the period/date for delivery of possession of the plot, to the complainants. It is not the case of the opposite party that it encountered any force majeure circumstances, as a result whereof, it was legally entitled for extension of time for delivering possession of the plots to the allottees, including the complainants.

                The opposite party also cannot evade its liability, merely by saying that since the words ‘best efforts’ were mentioned in the allotment letter i.e. the Company was to make best efforts only for completing the development and deliver possession of the plot, as such, time is not to be considered as essence of the contract. The act of non-mentioning of exact date in the allotment letter/Agreement is violation of CHAPTER II Regulation of Promotion of Construction, Sale, Transfer and Management of Apartments, Plots and Properties, Condition no. 3(2) (g) of the Punjab Apartment and Property Regulation Act, 1995 (PAPRA), which says that the project proponent is duty bound to specify, in writing, the date by which possession of the plot or apartment is to be handed over and it shall hand over such possession accordingly. Relevant contents of condition no.3(2) (g) of PAPRA are reproduced below:-

“(g) specify, in writing, the date by which possession of the plot or apartment is to be handed over and he shall hand over such possession accordingly”;

As such, plea raised in this regard, being devoid of merit, is rejected.

14.         Admittedly, possession of the plot, in question, was handed over to the complainants, by the opposite party, during pendency of this complaint, on 11.06.2019, on the orders having been passed by this Commission. Whereas, on the other hand, due date to hand over possession was 22.05.2014. The entire sale consideration stood paid by the complainants. The opposite party has been utilizing the amount paid by the complainants, for more than about four years, without providing them anything, as a result whereof, financial loss was caused to them. Even the final amount of Rs.4,01,734.60 ps., demand whereof had been made vide letter dated 17.04.2017 (Annexure OP/1 colly.)  has also been paid by the complainants to the opposite party. Under these circumstances, this Commission is of the considered opinion that the complainants need to be compensated for the period of delay in offering possession of the plot, in question, by the opposite party.
15.         What relief can be granted to a consumer, for delay in offering possession of the residential units/plots, fell for determination before the Hon’ble Supreme Court of India in DLF Homes Panchkula (P) Ltd. vs Sushila Devi, 2019 (Civil Appeal Nos. 2285-2330 of 2019 (@ SLP(C) NOS.928-930, 932-938, 940-967 and 969-976 of 2019), decided on 26 February, wherein, under similar circumstances, interest @9% p.a. on the deposited amount, already granted by the National Commission, for the period of delay in offering possession, was confirmed.  The principle of law laid down in the aforesaid case, is fully applicable to the present case. It is therefore held that the complainants are entitled to get interest @9% p.a., on the deposited amount, towards price of the said plot, for the period of delay i.e. from 22.05.2014 (committed date) till 28.06.2017 i.e. two months after issuance of completion certificate dated 28.04.2017 (Annexure OP/3).

                Besides as above, the opposite party is also liable to pay compensation to the complainants, for providing deficient service and guilty of adoption of unfair trade practice, thereby causing them mental agony and physical harassment.

16.         As far as objection taken to the effect that the complaint filed is time barred, it may be stated here that since legal possession of the plot, in question, could have been delivered to the complainants only after obtaining completion certificate (Annexure OP/3) and in the present case it has been obtained only on 28.04.2017, as such, the  complaint having been filed within a period of two years from the said date (28.04.2017), is within limitation. In this view of the matter, objection taken stands rejected.
17.         No other point, was urged, by the contesting parties.
18.         For the reasons recorded above, this complaint is partly accepted, with costs. The opposite party is directed as under: -
    1. To execute and get registered the sale deed, in respect of the plot, in question, in favour of the complainants, within a period of one month, from the date of receipt of certified copy of this order, on payment of registration and stamp duty charges by them, directly to the Registering Authorities, if not yet executed.
    2. To pay compensation to the complainants,, by way of interest @9% p.a., on the amount of Rs.35,46,195/-, from 22.05.2014 (committed date) till 28.06.2017 i.e. two months after issuance of completion certificate dated 28.04.2017, (Annexure OP/3),  within  30 days, from the date of receipt of a certified copy of this order, failing which, thereafter, the said amount of Rs.35,46,195/-,  shall further carry 3% penal interest i.e. total 12% p.a. (9% p.a. plus (+) 3% p.a.) from the date of passing of this order till realization.
    3. To pay compensation, in the sum of Rs.1,50,000/-, on account of mental agony, physical harassment caused to the complainants and cost of litigation, to the tune of Rs.35,000/- to the complainants, failing which, thereafter, the said amount of Rs.1,50,000/- and Rs.35,000/- shall carry interest @9% p.a. from the date of passing of this order till realization.
19.         Certified Copies of this order be sent to the parties, free of charge.
20.         The file be consigned to Record Room, after completion.

 

Pronounced

20.09.2019

 

Sd/-

[JUSTICE RAJ SHEKHAR ATTRI]

PRESIDENT

 

 

Sd/-

(PADMA PANDEY)

        MEMBER

 

 

Sd/-

(RAJESH K. ARYA)

MEMBER

Rg